Opening a business in Estonia in 2023: new rules
For foreign companies, starting a business in Estonia in 2023 is now faster than before. A world record was recently set here for the quickest business registration, which took only 15 minutes. The government is trying to attract investors who want to receive quality services and actively work. Therefore, in 2023-2024 several changes will come into effect, making registering a company in Estonia even easier.
Authorized capital
The minimum share capital for a private limited company is €2,500. Since February 2023, it has been reduced to €0.01 if the company has one shareholder. Also, when starting a business in Estonia, shareholders need only declare the required share capital instead of real money (except for crypto-business and activities requiring state regulation). It should be considered that the authorized capital must be deposited before the shareholders receive income in the form of dividends.
Reducing the minimum charter capital requirements will relieve young companies from the burden, allowing them to manage money wisely, and put it into business development. As a result, it will increase profits, contributing to a startup's growth.
Confirmation of payment of equity capital contributions
Now, it is obligatory to notify the regulator about the payment of the share capital, and the Commercial Register must confirm this fact. According to the new laws, this must be done if the deposit amount exceeds €50,000. It reduces the burden on young companies to solves problems associated with obtaining the necessary evidence from banks or other payment institutions that arise in practice.
Possibility to reserve the company name
From 2024, it will be possible to reserve a company name well before its registration in the Commercial Registry. Not only legal entities but also individuals will be able to do this. The name can be reserved for six months after paying a fee of €150.
The general requirements for the name remain unchanged:
- The legal form is clearly defined.
- The name must accurately indicate the areas of activity.
- The name must not contradict morals or contain swear words and similar words. No hint of belonging to the state or municipal bodies and institutions is allowed.
- The company name may not use a mark or combination of marks already registered as a trademark in Estonia.
The current procedure is valid until the changes come into force in 2024. The owner can check the uniqueness of the name in advance by requesting the Commercial Register. If it is already registered, it is possible to reapply free of charge with a new name. The brand or trade name may not match the company's actual name. The main requirement is that the intellectual property rights of other organizations must not be violated.
Other advantages of doing business in Estonia
- Low cost of company registration in Estonia compared to other EU countries.
- Possibility to register a business remotely without a personal visit to Tallinn with the e-residency card.
- An alternative option is to issue a power of attorney to our company representatives to open a business.
- No corporate tax on income tax unless it is distributed to shareholders.
- No need to officially hire a director and pay him a salary.
- Direct access to the EU market.
- Ability to use the names of nominal board members and founders if the actual owner wants to keep his name secret.
- Fast company registration if you submit the whole package of documents at once.
How to start a business quickly in Estonia
Contact IT-OFFSHORE to start a company in Estonia in 2023.