Frequently Asked Questions

General

We’re a professional service provider who provides company formation and management services in Estonia on a monthly subscription basis to customers from all over the world.

We offer 3 different subscriptions plans that you can choose from. After you’ve selected a plan that suits your needs and completed the checkout process you will redirected to a page that contains an incorporation form that you need to fill in. Once that’s done our corporate advisor will get in touch with you and provide further instructions to ensure the incorporation process is as smooth and easy as possible. 

If you are unsure which pricing plan is best for you then just follow this simple 2-step process to find out.

If you choose the Digital Nomad or Business Pro plan you are granting us the right to register an Estonian private limited company at the Commercial Register on your behalf. After filling in the incorporation form you will receive an e-mail from our dedicated corporate advisor regarding the next steps. We will complete the incorporation process once we have received all the required know-your-client documents.

In case you decide to go with the Do It Yourself plan, we will prepare and send you a contact person consent which you can then use to set up your company in the Company Registration Portal.

After you have subscribed, your credit card will be charged for the first month. If you choose the Digital Nomad or Business Pro plan you will also be charged a one-time state fee of 190 EUR.

All of our solutions allow you to establish any B2C/B2B business you have in mind. Doesn’t matter if it’s digital or physical, products or services. They all work for us! However, some business activities require an additional business activity licence – which we’ll gladly obtain for you if requested.

If you are an e-Resident of Estonia and have an e-Residency card then we will be able to register a company for you within one business day. If you are not an e-Resident of Estonia then we will register a company for you via a Power of Attorney which takes up to 5 business days. 

A “Power of Attorney” (PoA) is a legal document by which a person authorizes another person to act in their name and on their behalf in order to execute a transaction / perform an act or a number of transactions / acts pursuant to the terms and conditions set out in the text of the PoA. Using the PoA allows the person to delegate any actions to another person who will perform them in the name and on behalf of the person giving the authorization. Depending on the action to be taken under the PoA, the PoA might have to be notarized and apostilled. PoAs can be used for example for company formation, share transfer, adoption of different resolutions etc.

e-Residency is a digital identity issued by the Estonian government that enables people from around the world to establish an EU company remotely without physically being in the EU. However, it is not a photo ID, it is not a valid travel document, nor does it replace any visas or residence permits. You can find more detailed info about e-Residency here.

You can apply for e-residency online here. If necessary, we are happy to assist you in this matter. The average processing time for e-Residency is 4-6 weeks, but it may vary based on demand and pickup location. In order to receive the e-Residency card, you would need to choose a suitable pick-up location during the application process (the list of available pick-up locations can be found here). If there is no pick-up location in your country, you will have to choose another country from where you can collect the card. You will personally have to collect the card since you will be asked to provide fingerprints.

The state authorities generally accept documents in Estonian. However, many features of government online systems can also be accessed in English. Tax returns are available mainly in Estonian, but generally tax authorities accept documents and explanations in English during tax audits. Our customers usually have an Estonian accountant who communicates with authorities in Estonian and is familiar with the local laws and requirements.

If you require something that’s not included within your subscription plan you can always contact your corporate advisor and order the service individually. 

You may cancel your subscription at any time. We care about our clients and do not want to put any stress on them. In case the service is not necessary for you anymore and you would like to cancel the monthly packag then you are free to do so. However, upon cancelling your subscription, the contact person and registered address service provided by us will be stopped. All mail forwarding will be stopped as well. It is possible to proceed with the contact person and registered address service separately on a yearly basis if you wish to do so. Please contact your corporate advisor if you would be interested in the latter.

Yes! You can use your Estonian company to do business anywhere in the world and invoice clients from all over the world.

Please feel free to contact us via e-mail at advisory@incorporate.ee or via our online contact form here.

We have a duty to conduct KYC (know-your-client) investigations. We are obliged to apply for enhanced due diligence measures if our customer is identified without being present at the same place. If you do not plan to visit Estonia during the process we kindly ask you to send us:

1. A passport copy (notarized, with Apostille);
2. Scanned utility bill (to show your residence);
3. Bank reference letter (to show your full name).

We will assist you with other primary documents such as Articles of Association etc.

No, we are not a SaaS platform. This however means that we are able to offer you tailor-made solutions that are not possible via a SaaS platform. By subscribing to our service, you do not have to join the e-Residency program, your business is not limited by areas of activity or the number of founders. You can also set up a businesses that requires licensing in Estonia (e.g. cryptocurrency exchange license etc.). This would NOT be possible through a SaaS platform.

Company Management & Banking

The suitability of a business name can be checked in the Company Registration Portal. This allows you to search for identical and similar (business) names as well as for registered trademarks in the Commercial Register.

When registering a company, choosing a name for your business is an important part of the incorporation process. Our specialists can help and consult you so that the chosen business name would be compatible with the registration requirements and would not infringe other business owners’ or trademark owners’ rights to their original name for offering their specific goods or services.

The key questions when choosing a business name are as follows:

• the business name of a company must be clearly distinguishable from other business names entered in the Commercial Register;
• the business name of a self-employed person must be clearly distinguished from other business names entered in the Commercial Register;
• one self-employed person may have several business names if he/she has several companies registered in the Commercial Register;
• the name of a non-profit company and foundation must be clearly different from the names of other non-profit companies and foundations entered in the Commercial Register;
• the business name shall not be misleading with regard to the legal form, area of activity or scope of activity of the undertaking;
• the business name shall not be contrary to good morals.

Please note that there are additional requirements for business names, as such we would advise you to contact one of our dedicated employees to discuss this matter further.

Yes, 100%! We will only assist you in incorporating the company in your name and on your behalf. After the company has been registered, you will have full control over the management and decision-making process of the company and equity interest in the company.

Yes, you can hire employees for your company! The employment must be registered with the Estonian Tax and Customs Board for tax calculation.

Yes! Your company can have multiple shareholders and there is no maximum limit as to the number of shareholders in one company. 

Yes, you can use our services if you have a dropshipping or Amazon FBA business!

No, not necessarily! If you have an e-Residency card you can register a company fully remotely. Alternatively, we are also able to establish a company for your on the basis of a power of attorney. In both cases, you do not need to visit Estonia!

Estonian corporate income tax (CIT) system differs from the traditional systems. All profits which are earned by the company are not subject to CIT. The same applies if the profits are retained at the accounts of the company or reinvested (used for business purposes). CIT is due when the profits are taken out from the business (e.g. in the form of dividend). Thus, in principle, the shareholder of the company decides when he/she wants to pay CIT. CIT rate is approx. 20% (20/80 is applied on the net amount of the dividend).

The general VAT registration threshold is EUR 40,000 per calendar year. If you do not perform activities which trigger a VAT registration obligation in Estonia, you do not have to proceed relevant registration. The company may register itself for VAT purposes on a voluntary basis also before the above-mentioned EUR 40,000 threshold is exceeded.

General taxes related to salaries (employment arrangement) in Estonia are social tax and unemployment insurance covered by the employer, income tax and unemployment insurance covered by the employee.

You will not automatically get a bank account for your company but we can assist you with opening a bank account. Requirements arising from different regulations have made the process of bank account opening more complicated and expensive. We are able to put our best efforts and previous experience in order to achieve your aims, but the final decision is made by the bank and it is dependent on circumstances which we cannot influence. 

However, you do not necessarily need an Estonian bank account for your Estonian company. Please take a look at “Do I need to have a bank account in Estonia” section

No, the Estonian company does not necessarily need to have a bank account in an Estonian bank, but the bank account can be in any other EEA country. In addition, as an alternative to bank accounts, we also offer our clients the possibility to open a payment account with a payment service provider or a FinTech company / online bank instead.

Yes, the traditional banks require at least one face-to-face meeting for opening a bank account. If you are unable or unwilling to visit Estonia for the bank account opening, then it is possible to apply for an account either with a payment service provider or a FinTech company / online bank. The latter have less strict requirements and do not require physical presence for account opening.

The shareholders (owners) and management board members (directors) of the company are responsible for making sure that the company stays compliant with laws and regulations. We can offer you different services in relation to legal compliance as per your request.

There is no easy or fast solution to close the company. The first option is liquidation. In order to deregister a company, it needs to go through a liquidation process. The process takes up to 6 months and consists of submitting the annual report and balance sheet, writing an overview of the company’s economic activities. It also includes appointing a liquidator, sending applications to the Commercial Register and making an official publication. At the end of the period, there is a distribution of assets and deletion of the company from the registry.

There is an alternative option as well in case the company is owned by a sole private person. This process is called the merger of the private limited company with the assets of the natural person. The process takes approximately 1,5 months and consists of drafting a merger resolution, making a notarial merger agreement, submitting a notice to Public Notice Portal and closing the accounting. 

Accounting

Accounting services are included with the “Digital Nomad” and “Business Pro” subscription plans. Your company will be added to our accounting software and you will receive a personal accountant that takes care of your accounting. The “Do It Yourself” subscription plan does not come with accounting services, however, it is possible  possible to order accounting services separately if needed.

You can also take care of your own accounting without our help if you wish to do so!

You need to provide the following accounting documents:

  1. Purchase invoices
  2. Sales invoices
  3. Cash or card payment documents
  4. Transactions with securities
  5. Loan agreements
  6. Payroll calculation documents
  7. A bank statement.

Our corporate advisor will introduce you to a dedicated accountant to whom you can e-mail the required documents. 

Accounting documents of the company (incl. incoming and outgoing invoices, agreements, bank statements, information about the salaries, etc.) have to be forwarded to our accountant on a monthly basis (latest by the 5th day of the month) via e-mail. Generally, our clients forward their accounting documents in PDF. Please note that Estonian tax returns are due on a monthly basis: income tax and payroll return is generally due latest by the 10th day of the month which follows to the taxation period and VAT return is due latest by the 20th day.

You will be given additional time to provide the documents if the company is not VAT registered and we have the right to ask for an additional fee. In case the company is VAT registered then the Tax and Customs board have the right to impose a penalty payment to the company if declarations are not submitted on time.

In case the company is not VAT registered then you do not need to add VAT to invoices. When a company is VAT registered then VAT (20%) will be added to an invoice if it is issued to an individual residing in the EU and to an EU company that is not VAT registered. An invoice without VAT will be issued to:

(1) An individual residing outside the EU

(2) A company domiciled outside the EU

(3) EU domiciled VAT registered company

Currently most transactions need to be forwarded to us manually in the right file format.

For example, you can send statements from Transferwise as .csv files to us on a monthly basis or as often as we agree on. Similarly, you can send Stripe statements to us either in .pdf or .csv on a monthly basis or as often as we agree on. 

The files will then be imported into our accounting system.

Payments & Subscriptions

There is no need to be an e-Resident of Estonia in order to establish company in Estonia.

Yes, it’s possible to upgrade from any subscription plan to a higher one. Downgrading is also possible, but the benefits and advantages of the previous package will no longer be available to you. The current package lasts until the next payment date.

In case you unsubscribe, the contract will be terminated and you are obliged to change your company’s address and  contact person. If you do not do this, we will inform the Commercial register and your company will no longer be able to use our services.

You can switch to another service provider at any point in time. Please note that after you cancel the subscription and move to another service provider, our services will no longer be available to you.

Due to the regulatory restrictions in Estonia we do not provide services to the citizens of the following countries:

 

Afghanistan   

Bosnia and Herzegovina

Guyana

Iraq

Iran

Laos

North-Korea

Syria

Uganda

Vanuatu

Yemen

The Bahamas

Barbados

Botswana

Cambodia

Ghana

Jamaica

Mauritius

Mongolia

Myanmar (Burma)

Nicaragua

Panama

Zimbabwe

Burundi

Central African Republic

Congo

Guinea

Haiti

Libya

Mali

Somalia

South Sudan

Yes, you can order services directly from us by contacting your corporate advisor. The fee for the ordered services will be paid based on an invoice.

You can purchase a subscription plan using any major credit or debit card. Additional services that are ordered separately can be paid via a bank transfer, PayPal or via Western Union. 

The Digital Nomad and Business Pro pricing plans come with a one-time state fee of 190 EUR. This is the amount that the Estonian government charges for the registration of a new company. The Do It Yourself package doesn’t include the state fee as you will be registering the company yourself. You will have to pay the state-fee to the government on your own. 

If you couldn’t find an answer to your question, please feel free to contact us!