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EE · European Union · Evidence report

Private limited company (OÜ)

Digital EU administration with tax on distributed profit, but e-Residency is not tax residency.

Confidence: high · Last checked 2026-08-21 ·4 official sources

Practical snapshot

Formation

Online OÜ registration costs €265 and registry review is usually one business day after a complete digitally signed application; obtaining an e-Residency card can take far longer.

Recurring cost

Moderate: official guidance estimates a required contact-person service at €200–€400 annually, before bookkeeping and annual-report preparation.

Tax frame

Retained profit is not taxed on accrual; distributed profit is generally taxed at company level at 22/78 of the net distribution. Cross-border residence rules still apply.

Banking

e-Residency does not guarantee a bank or payment account. Providers make their own residency, activity and KYC decisions.

Client acceptance

An EU entity and VAT framework can be familiar to European clients, subject to the actual contract and tax setup.

A good starting point when

  • Remote operators who want an EU company
  • Businesses that reinvest a meaningful share of profit
  • Founders comfortable with digital administration and annual reporting

Reasons to reject it early

  • You assume e-Residency changes personal or corporate tax residence
  • You need guaranteed banking from a specific provider
  • You will distribute nearly all profit and gain little from deferral

What this report assumes

If an assumption is false, the recommendation should be recalculated. These are not minor footnotes; they define the model’s boundary.

  • The founder can obtain an e-Residency digital ID or another accepted signing method
  • A licensed contact-person/address service is used when required
  • Cross-border permanent-establishment risks receive professional review

Banking is never included in formation. A licence, registration number or registered agent does not guarantee an account, payment processor, IBAN, card programme or client approval.

Official sources

Sources support the specific facts named below. Practical judgments about banking and client familiarity are labelled as inferences and should be validated for the actual founder and provider.

Establishing a companye-Residency of Estonia · Digital formation process, prerequisites and service-provider role.Official source ↗Private limited company (OÜ)Estonian e-Business Register · Official company-registration service and state-fee information.Official source ↗Income tax and basic exemptionEstonian Tax and Customs Board · Corporate distributions and applicable income-tax treatment.Official source ↗Annual reportEstonian e-Business Register · Annual-report filing obligation and official submission channel.Official source ↗

Next step

Use this evidence as an agenda for a licensed tax or legal adviser, then test banking eligibility with the provider before committing to formation.

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