How to Establish a Company in Estonia: A Step-by-Step Guide

By Urmas Rooba

Why Choose Estonia?

Estonia has become a popular destination for entrepreneurs looking to establish a company due to its advanced digital infrastructure, ease of business setup, and favorable tax policies. Known for its innovative e-Residency program, Estonia offers a streamlined process that allows non-residents to start and manage an EU-based company entirely online.

estonia business

Step 1: Obtain e-Residency

The first step in establishing a company in Estonia is obtaining e-Residency. This digital identity allows you to access Estonia's e-services, which include setting up and managing a business. To apply for e-Residency, visit the official Estonian e-Residency website and fill out the application form. The process is straightforward, and you will need to provide your personal information and a scanned copy of your identification.

Step 2: Choose a Company Name and Type

Once you have your e-Residency, you can proceed to choose a company name. Make sure the name is unique and adheres to the Estonian Business Register's guidelines. After selecting a name, decide on the type of company you want to establish. The most common type for foreign entrepreneurs is a Private Limited Company (OÜ).

Step 3: Register Your Company

With your company name and type decided, the next step is registration. You can do this online via the Estonian Business Register. You will need to provide details such as the company’s address, share capital, and board members. The registration process is efficient, often taking only a few days.

business registration

Step 4: Open a Business Bank Account

After registering your company, it's important to open a business bank account. While Estonia offers modern digital banking solutions, some entrepreneurs may prefer opening an account with an international bank that operates in Estonia. Consider factors like transaction fees, customer service, and online banking options when choosing a bank.

Step 5: Register for Taxes

Estonia’s tax system is one of the most competitive in Europe. After setting up your bank account, register your company for taxes through the Estonian Tax and Customs Board. It’s essential to understand your tax obligations, including VAT registration if applicable, to ensure compliance with local laws.

tax registration

Step 6: Set Up Accounting

Proper accounting is crucial for managing your business finances effectively. You may choose to hire an Estonian accounting firm or use digital accounting software that complies with Estonian regulations. Whichever option you choose, ensure that all financial records are accurate and up-to-date.

Final Thoughts

Establishing a company in Estonia offers numerous advantages for entrepreneurs seeking a reliable and efficient business environment in Europe. By following these steps—obtaining e-Residency, choosing a company name, registering the company, opening a bank account, registering for taxes, and setting up accounting—you can successfully launch and manage your business in Estonia.

With its progressive digital infrastructure and supportive business ecosystem, Estonia continues to attract innovators from around the world eager to tap into the benefits of its entrepreneurial landscape.