If your answer to these questions is ‘yes’, you can consider starting a company In Estonia.
Are you an entrepreneur or a business owner from a non-EU country, and would you like to enter the EU market with minimum costs?
You are an entrepreneur from an EU member country but would like to expand your business with minimum costs?
Are you a freelancer/digital nomad who would like to avoid bureaucracy?
E-residency is a digital identity and status issued by the Estonian government that enables you and your business to access the Estonian business environment. Through e-residency, you can start a company in Estonia and manage your business fully online.
Why e-Residency?
E-residency presents many advantages for your business:
Access to the EU market
Through your e-residency, you can start a company In Estonia online (complete online registration process) and that company will be an EU company through which you will have access to the EU market with minimum costs and bureaucracy.
Moreover, your business will become a part of Enter Estonia’s digital business environment.
Online business growth
After online registration and establishment, you can manage your company completely online. This will make your business mobile and flexible. Moreover, you can execute your financial transactions through convenient online banking tools.
This flexibility will contribute to expanding your EU-based company globally.
Reduced bureaucracy
Online registration and management will enable your business to go paperless with secure digital solutions, and automate or delegate business administration.
This will save you time and money.
Join a global community
When you have a digital Estonian company through e-residency, you will become part of a network with like-minded e-resident entrepreneurs. Furthermore, you will be able to connect with expert service providers.
You can enjoy dedicated support and resources.
Why start your company in Estonia?
Estonia is one of the most entrepreneur-friendly countries offers many advantages to businesses:
Estonia is the number one country in EU Digital Economy and Society Index; WEF Entrepreneurship; and OECD Tax Competitiveness.
Estonia is a member of the EU, NATO, WTO, OECD, and DIGITAL5. Estonia has the most startups per capita in the EU.
In Estonia, 96,3% of the people declared income electronically.
In Estonia, 99,6% of bank transactions are done electronically.
Who should apply for an e-Residency?
E-residency applications are open to citizens from all over the world. Most of the e-residents are entrepreneurs who work digitally and want to start an EU company and manage remotely. E-residency is advantageous for the following:
Business owners+ entrepreneurs - who would like to run a fully digital company in the EU and access the EU market,
Freelancers + consultants+ digital nomads -who want to avoid bureaucracy and do not want to be limited with geography.
How to proceed with e-residency?
We have gathered the step-by-step process for e-residency in Estonia:
1. Collect your documents
Before sitting in front of your computer and completing your e-residency application, you need to collect all the documents that will be required during the application. These documents are:
A copy of your government-issued ID,
A passport-style digital photo,
Motivation statement,
Visa or Mastercard.
2. Pay the state fee
To proceed with your application, you need to pay the state fee and receive a confirmation email after successfully submitting it.
If you choose an office in Estonia as the pick-up location, the fee is €100.
If you choose a foreign representation of Estonia as the pick-up location, you will have to pay €120 upon applying.
The state fee is a one-time payment. You can access the application form here. If you have all your documents ready with you, the application will take under 1 hour.
3. Complete your application
Once you complete your application, it will be reviewed. Estonian Police & Border Guard Board will conduct a background check and will notify you by email when the process is complete. The process takes 3-8 weeks.
You should be ready that Estonian Police and Border Guard Board may request additional information while conducting your background check which may increase the processing time.
4. Collect the e-Residency kit
If granted e-Residency, you will be invited to collect the e-Residency kit at the location selected on your application (you may change it later but will need to pay the extra cost).
While collecting your e-residency, you will need to bring a government-issued ID submitted with the application and submit fingerprints. Every 5 years, you will need to renew your e-residency kit.
How to start a company through your e-resident ID?
Once you have your e-residency, you are ready to start your company online. We have gathered step by step process for starting a company through e-residency in Estonia:
Step 1:
When you receive the e-residency kit and activate it, you become an e-resident. And once you are an e-resident, you can start an online Estonian company.
Step 2:
Before starting your company, you will need to choose a service provider. In other words, you need to obtain an Estonian contact person and legal address from Estonian Marketplace. This necessity stems from Estonian law.
If the management board of a company is in a foreign state, the company must designate a contact person who acts as a messenger if local authorities have a need to contact your company and cannot reach you in person.
The contact person does not need to be a shareholder, board member, or employee and you do not need to grant any rights to act on behalf of your company. The cost of obtaining a contact person is around €30-150 monthly average (some include bookkeeping and other features).
Step 3:
The registration of your company is done through the e-Business Registry. Estonian public authorities provide detailed instructions on the steps of starting a company online. The company registration costs €190.
On the other hand, you should be aware that your company can only be registered online if
all founders, board members, etc. have an Estonian e-Residency digital ID card,
or an Estonian, Latvian, or Belgian ID card, Estonian
or Lithuanian mobile ID and they are private persons.
If this is not the case or you are interested in registering a subsidiary of a foreign company, you need to use the services of a public notary office in Estonia. You can find a list of notaries from the website of the Estonian Chamber of Notaries.
When you establish a private limited company in Estonia, you are also required to register its minimum share capital of €2500 (Estonian Commercial Code). Share capital contribution belongs to your company and can be used to pay for business activities.
Once the share capital has been transferred to your company’s bank account with a credit or payment institution within the European Economic Area (EEA) and registered in the Estonian Business Register, you may use these funds for business-related expenses. It is important to declare a share capital at the Estonian Tax and Customs Board.
Step 4:
Once you have your company, you will need to cover your company’s banking needs. For this need, you have two options:
finding a fintech partner in Estonian Marketplace
or proceeding with payment institutions.
There might be some additional steps after the company registry and all of them can be handled online:
Depending on the company’s area of activity and size, a varying number of additional steps must be taken.
If the area of activity is subject to specific requirements, a license must be acquired.
For the use of e-services Estonian Tax and Customs Board, you will have to conclude a contract for the use of e-Tax/e-Customs.
If needed, register your company as a VAT payer on the website of the Tax and Customs Board.
If your company has employees, register the employees in the employment register on the website of the Tax and Customs Board.
Get support from intermediate agencies
Through your company establishment, you can also receive support from intermediate agencies like Mükellef. Mükellef is an application in which you can perform end-to-end process management for company establishment and accounting via an internet connection.
Within this scope, they
follow your application;
offer virtual office services;
provide a pre-accountancy program that accelerates and simplifies accountancy processes;
help you prepare for tax returns.
They provide these services with a transparent price policy that remains within reasonable investment limits. Presently, they provide support for establishing companies in Turkey, USA, UK, and Estonia.
Starting a company in Estonia is fully digitalized. Through e-residency, you can start your company in Estonia and manage your business fully online. This is advantageous in terms of lower costs, less bureaucracy, EU market access. The Estonian government provides all the information and application processes in English, Estonia, and Russian.
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