Estonian companies must prepare and submit an annual financial report to the tax authority within six months after the end of the tax period. The tax period (fiscal year), as a rule, coincides with the calendar year, but you can determine it yourself by notifying the tax authority.

The cost of our services for preparing financial statements for a dormant company is EUR 300. The cost of reporting for an active company is calculated individually depending on the number of transactions performed on the bank account.

An audit is required when the following two conditions are met simultaneously:

• The number of company employees is equal to or exceeds 30 people;
• The balance sheet volume is equal to or exceeds 1 million euros;
• The income or sales amount is 2 million euros or more;

or one of the conditions below:

• Number of employees – 90 or more;
• The balance sheet volume is equal to or greater than 3,5 million euros;
• Income is 6 million euros or more.
  
  

Basic taxes 

The main tax advantage of Estonia is the absence of tax on retained earnings (0%). Thus, only dividends paid to shareholders and shareholders are subject to taxes. Tax on dividends paid is 20%. If the profit is derived from dividends of a subsidiary or foreign representative office of the company, then dividends paid to shareholders are exempt from taxes.

The standard VAT rate is 20%.

Tax residency

A legal entity is recognized as a tax resident of Estonia if it is registered in Estonia or if its activities are managed and controlled in Estonia. The residence of directors does not affect tax residence. Obtaining a tax residence certificate is not difficult, but you need a notarized power of attorney from the director of the company for the right to represent it at the Tax and Customs Department.

Order fulfillment time

Registration of a company in Estonia or re-registration of an existing company takes about 3 weeks from the moment the client provides all the necessary information and documents.