Company Establishment in Estonia Part Two
Cost Of Setting Up A Company In Estonia
You may set up your business online or partner with companies that offer services in this area for the next phase. You can set up a business as a Limited Company or as a single partner.
Your business would need an address in Estonia, it may be a virtual office. The capital of the company shall be at least €2500. The title will be selected for the creation of the organization and the area of operation will be decided. For the establishment, 190 €state tax must be billed to the state.
If you wish to obtain assistance in this respect, several businesses offer both corporate establishment, virtual address utilization, and regular filing, accounting, and financial services, which can range from €50 to €200 a month. (Generally, + 20% of VAT)
While it is easy to start up a business, it is not that easy to shut the company. The liquidation process shall take at least 7-8 months and, during that time, the Estonian citizen shall be named as liquidator.
Taxation In Estonia
Let's get to the tax issue ... The corporate tax level in Estonia is 20%, but you do not pay this tax until you allocate profit, in other words, corporate tax is postponed. VAT (20 percent), withholding income (over EUR 16,000) and social security contributions (33%) are monthly paid.
If your goal is to open up to businesses in the European Union and to use Paypal or other digital payment methods, a business will be founded in Estonia. If the goal is to pay less or stop taxes, there is no reason to take risks.
Besides, if you distribute the income in the business you have formed in Estonia, you will be liable to additional taxes and obligations. However, if this procedure is not conducted carefully, it can result in increased tax fines and liabilities.
If you want to set up a business in Estonia for this reason, you can hire a company registration agency.