Estonia Company Formation
Estonia Company Formation: Launch Your Business in Europe’s Most Digitally Advanced Jurisdiction Main Characteristics and the basic rules of Company registration in Estonia
Estonia Company Formation with BRIS Group
BRIS Group provides professional Estonia company formation services for entrepreneurs, investors, and international businesses seeking a secure European base. Forming an Estonian OÜ (Private Limited Company) offers limited liability protection, access to EU markets, and a highly digital business environment. Our team manages the full Estonia company registration process remotely, including corporate banking support, compliance, and ongoing administration, ensuring your business operates efficiently and fully complies with Estonian regulations.
Start your Estonian company with BRIS Group today — trusted experts in global incorporation.
Company Formation in Estonia: Guide for Non-Residents
Estonia has emerged as one of Europe’s most forward-thinking business destinations — a digital-first nation offering a simple, transparent, and highly efficient company formation process. With its advanced e-Governance system, zero percent corporate tax on retained earnings, and full access to the European single market, Estonia company formation is ideal for entrepreneurs, startups, and international investors seeking a modern and cost-effective EU base.
This guide covers everything you need to know about registering a company in Estonia — from its advantages and company types to taxation and step-by-step formation procedures.
Why Choose Estonia for Company Formation?
Estonia combines innovation, transparency, and efficiency to create one of the most business-friendly environments in Europe. Its digital infrastructure allows non-residents to establish and manage companies entirely online through the Estonian e-Residency program, making it a top choice for global entrepreneurs.
Key Benefits of Estonia Company Formation:
- 100% Online Incorporation: Establish and manage your company remotely with e-Residency.
- Zero Corporate Tax on Retained Profits: Only pay tax when distributing dividends.
- EU Market Access: Operate freely within the European Union and trade seamlessly across borders.
- Stable Economy and Governance: Politically stable, transparent, and part of the Eurozone.
- Low Bureaucracy: Simple, digital, and efficient administrative processes.
- Skilled and Tech-Oriented Workforce: Perfect for startups and IT-driven enterprises.
- Cost-Effective Operations: Low maintenance costs and streamlined compliance.
Types of Companies in Estonia for Non-Residents
Estonia offers several company structures, but the Private Limited Company (OÜ – Osaühing) is the most popular for foreign investors.
|
Company Type |
Description |
Minimum Capital |
Best For |
|
OÜ (Private Limited Company) |
The most common entity; limited liability for shareholders and simple setup. |
€2,500 (can be deferred) |
SMEs, startups, digital businesses |
|
AS (Public Limited Company) |
Suitable for larger corporations with share issuance capability. |
€25,000 |
Large-scale or listed companies |
|
Branch Office |
Operates as an extension of a foreign company; not a separate legal entity. |
N/A |
Established foreign corporations |
|
Sole Proprietorship (FIE) |
Owned by a single individual; personally liable for all obligations. |
N/A |
Freelancers or small entrepreneurs |
Advantages and Considerations for Non-Residents
|
Advantages |
Considerations |
|
0% corporate tax on retained and reinvested profits |
Tax applies on distributed profits only |
|
100% online company management via e-Residency |
Requires understanding of digital systems |
|
Fast incorporation (as little as one day) |
Local legal address required |
|
Low setup and administrative costs |
Must comply with EU accounting standards |
|
Access to EU markets and funding programs |
Need for local contact person for non-resident companies |
|
Reputable and transparent jurisdiction |
Not ideal for purely passive holding companies |
Requirements for Company Registration in Estonia
To register a company in Estonia, non-residents must meet certain legal requirements. Most steps can be completed remotely through e-Residency.
- Company Name: Must be unique and approved by the Estonian Business Register.
- Registered Office: A legal address in Estonia is required.
- Contact Person: Mandatory for non-resident companies; must be an Estonian service provider.
- Share Capital: Minimum €2,500 for OÜ (can be deferred until dividends are distributed).
- Shareholders and Directors: At least one shareholder and one director (individual or corporate).
- Articles of Association: Outlines the company’s structure, purpose, and internal regulations.
- Bank Account: Necessary for capital deposit and financial operations.
- Registration: File the application with the Estonian Business Register (Äriregister).
- Tax Registration: Register for corporate income tax and VAT (if applicable).
Step-by-Step Procedure for Estonia Company Formation
Step 1 – Apply for e-Residency (Optional but Recommended)
Non-residents can apply for Estonian e-Residency, allowing them to establish and manage companies online.
Step 2 – Choose and Reserve a Company Name
Verify name availability through the Estonian Business Register.
Step 3 – Draft the Articles of Association
Prepare the company’s Articles of Association digitally and sign using e-Residency or notarization.
Step 4 – Register the Company
Submit incorporation documents and shareholder information to the Estonian Business Register online or via a notary.
Step 5 – Open a Bank Account
Set up a corporate bank account or fintech account (e.g., Wise, Paysera, or LHV Bank) to manage finances.
Step 6 – Tax Registration
Register the company with the Estonian Tax and Customs Board (Maksu- ja Tolliamet) for corporate and VAT obligations.
Timeframe for Estonia Company Formation
| Stage | Description | Estimated Time |
| e-Residency Application | Apply for and receive e-Residency card | 2–6 weeks |
| Document Preparation | Drafting and digital signing of incorporation papers | 1–2 business days |
| Registration with Business Register | Online submission and approval | 1–5 business days |
| Tax and VAT Registration | Issuance of tax numbers | 3–7 business days |
Total Estimated Time: 1–3 weeks for online registration (up to 6 weeks if e-Residency application is included).
Corporate Tax System in Estonia
Estonia’s tax system is one of the most competitive and entrepreneur-friendly in Europe.
Corporate Tax Overview:
- Corporate Income Tax: 0% on retained and reinvested profits.
- Distributed Profits Tax: 20% (calculated as 20/80 of the net distribution).
- Reduced Rate: 14% for regular dividend distributions to legal entities.
- Withholding Tax: Generally 0% on dividends paid to non-residents (subject to tax treaties).
- VAT: Standard rate of 22%; reduced rates of 9% for certain goods and services.
- Social Tax: 33% (paid by employers on salaries).
- Personal Income Tax: Flat 20% rate.
Key Tax Advantages:
- No tax on retained or reinvested earnings encourages business growth.
- Simplified reporting system; corporate tax is payable only upon profit distribution.
- Over 60 double taxation treaties ensure favorable tax treatment for foreign investors.
- Fully digital tax filing through Estonia’s e-Tax system.
Post-Incorporation Compliance
Once established, Estonian companies must maintain regulatory compliance, including:
- Filing annual reports with the Estonian Business Register.
- Keeping accurate accounting records under Estonian GAAP or IFRS.
- VAT returns submission (if registered).
- Payroll and tax filings for employees.
- Maintaining a valid registered office and contact person in Estonia.
How Our Professionals Can Help
Our expert team simplifies the Estonia company formation process for non-residents. From digital registration to tax optimization, we provide tailored support to ensure compliance and efficiency.
Our Services Include:
- e-Residency application support
- Company name search and reservation
- Drafting and filing incorporation documents
- Virtual registered address and contact person services
- Bank and fintech account opening assistance
- Tax and VAT registration
- Accounting and compliance management
- Corporate tax and dividend planning
- Ongoing legal and administrative support
Start Your Estonia Company Formation Today
Estonia offers one of the most efficient, transparent, and digitally advanced business environments in the world. With its zero-tax policy on retained earnings and 100% online management, it’s the ideal jurisdiction for global entrepreneurs seeking an EU-based, low-bureaucracy company setup.
Contact us today to start your Estonia company formation process. Our team of corporate specialists will handle every step — from e-Residency to tax compliance — ensuring your business is ready for success in Europe’s most innovative digital economy.
Questions & Answers
1. What is the Corporation Tax rate in Estonia?
Estonia operates a unique corporate taxation system where profits are not taxed until they are distributed as dividends. The standard rate for distributed profits is 20% on the gross amount, equating to 25% on the net dividend. This encourages reinvestment of profits within the company.
2. How are dividends taxed in Estonia?
Dividends paid to residents are subject to a 20% tax, same as the corporation tax on distributed profits. Non-residents may benefit from reduced rates or exemptions under international tax treaties, depending on their country of residence.
3. What is the Income Tax rate for individuals in Estonia?
The income tax rate in Estonia is a flat rate of 20% on both employment income and individual business income. This rate applies to all levels of income, simplifying the tax structure and promoting fairness.
4. How is VAT structured in Estonia?
The standard VAT rate in Estonia is 20%. There are reduced rates of 9% for certain goods and services, such as books and tickets to cultural events, and a zero rate for exports. Registration for VAT is mandatory for businesses whose taxable turnover exceeds €40,000 annually.
5. Are there any other taxes in Estonia I should be aware of?
Yes, Estonia has several other taxes including social security contributions, which amount to 33% on gross salaries, as well as property tax, which varies by municipality and is generally around 0.1-2.0% of the property value. Local taxes can vary widely, so it’s advisable to consult local regulations based on your specific situation.
This concise overview provides essential information about taxation in Estonia, enabling businesses and individuals to navigate the tax landscape effectively
Learn more: Visit our Full Estonia Company – FAQ page
or contact our tax and company formation team at[email protected]
What is the process for non-residents to form a company in Estonia?
The process for non-residents to form a company in Estonia involves several key steps. First, you need to choose a unique company name and check its availability in the Estonian Business Register. Next, you will need to prepare the necessary documents, including a founding resolution and articles of association. Non-residents can use the e-Business Register to submit their documents online. If you do not have an Estonian ID card, you can also employ a service provider who can act as a representative to handle this process. Once the application is approved, you will receive a registration certificate and can then open a bank account.
Do I need to be a resident to form an Estonian company?
No, you do not need to be a resident of Estonia to form a company there. Estonia has made it very easy for non-residents to start businesses through its e-Residency program. This program allows individuals from anywhere in the world to apply online, receive a digital ID, and manage an Estonian company remotely. The e-Residency gives you access to Estonia’s digital services, allowing you to conduct business, sign contracts, and report taxes online without needing to physically be in the country.
What type of company can I register as a non-resident in Estonia?
As a non-resident, you can primarily register a private limited company (OÜ) in Estonia, which is a popular choice due to its flexible structure and limited liability. This type of company allows you to engage in both local and international business activities and provides some tax advantages. Additionally, you may also establish a sole proprietorship or a public limited company, but the OÜ is recommended for most entrepreneurs because of its simpler administration and lower capital requirement.
What are the costs involved in setting up a company in Estonia?
Setting up a company in Estonia involves various costs, which can range depending on your company structure and other requirements. The state fee for registering a private limited company is approximately €190 if done online through the e-Business Register. If you use a service provider or need additional legal assistance, costs may vary. Furthermore, you may incur expenses for obtaining a registered address, bookkeeping, and other operational costs. It’s advisable to budget for around €300 to €1,000 for initial setup costs.
Are there any tax advantages for companies in Estonia?
Yes, Estonia offers several tax advantages for companies, particularly for non-resident entrepreneurs. The Estonian corporate tax system is unique, as companies only pay corporate income tax on distributed profits. This means that retained earnings are not taxed, allowing companies to reinvest profits back into the business without immediate tax liabilities. Additionally, the country has a low corporate tax rate of 20%, which can be beneficial for international investors seeking a favorable business environment.
How can I manage my company remotely as a non-resident?
Managing your Estonian company remotely as a non-resident is facilitated by the e-Residency program, which provides a digital identity to access various government services online. You can handle everything from company registration to tax reporting through the e-Business Register. Additionally, many service providers in Estonia offer bookkeeping, legal, and administrative services to assist remote managers. Utilizing cloud-based tools for communication and project management can also help streamline operations, ensuring that you can effectively run your business from anywhere in the world.
or contact our tax and company formation team at
This publication is provided for information purposes only. This info should not be treated as a substitute for a tax or legal consultation or legislation. You should not act on the basis of the information contained in this publication without having obtained individual advice from the professional expert.
BRIS GROUP does not assume responsibility for any damage resulting from decisions made by the reader on the basis of this publication.
About Estonia
Country: Estonia
Capital: Tallin
Continent: Northern Europe
Language: Estonian/Russian
Currency: EUR
Time Zones: GMT +1
Dial Code: +372
Abbreviations: EE
Helping Your Company Thrive in Estonia With us, starting and running a business in Estonia will be easy and efficient!
- Full support of the company’s registration in Estonia: from the preparation of documents to their submission.
- Remote registration: all processes are online, wherever you are.
- Secretary and Treasurer: we can take on these important roles.
- Nominal directors and shareholders: we will ensure the confidentiality of your information.
- Help in opening a bank account: we will simplify this complex process.
- Registration for taxes, VAT and EORI: ensure all requirements are met.
- Website development: we will create a professional online representation for your business.
- Logo creation: we will design a unique and memorable logo for your brand.
- Full administrative support of the company: we will take over routine tasks.
- Mailing address organization: we provide a reliable mailing address for your business.
- Organization of the virtual office: we will ensure the professional image of your company.
- Telephone answering service: we will answer calls on behalf of your company.
- Accounting, audit and reporting: ensure accurate and timely accounting.
- Preparing and filing a VAT declaration: let’s save you the trouble.
- Interaction with local authorities: take over communication with state institutions.
- Trademark registration: protect your brand.
- More Emphasis on Customer Input.