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Which type of company to choose in Estonia: OÜ, AS or FIE?
Estonia offers entrepreneurs several business registration options. Your choice depends on taxation, liability, and required…
Main Types of Companies in Estonia
| Company Type | Key Features |
|---|---|
| Osaühing (OÜ) | Equivalent to an LLC. Suitable for small to medium-sized businesses. The minimum share capital to pay dividends is €2500. You can register with as little as €0.01, but must raise capital to the minimum level before distributing profits. |
| Aktsiaselts (AS) | A corporation. Requires a minimum capital of €25,000. Best for larger businesses expecting multiple investors and issuing shares. |
| Füüsilisest isikust ettevõtja (FIE) | Sole proprietorship. Easy to register, but the owner is personally liable for business debts, pays turnover tax, and cannot reclaim VAT. |
Key Differences Between OÜ, AS, and FIE
- Liability: OÜ and AS protect owners with limited liability based on share capital. FIEs are personally liable with all their assets.
- Taxes: OÜ and AS pay 22% corporate tax on dividends. FIEs pay 22% personal income tax and 33% social tax.
- Capital Requirements: OÜ – €2500 (or €0.01 initially), AS – €25,000, FIE – no capital required.
- Popularity: OÜ is the most common form for startups and small businesses.
Which Option Should You Choose?
Your choice depends on your business model:
- If you are a freelancer or want to operate as an individual → FIE. You remain a private individual, and FIE makes it easier to pay taxes on income. However, it’s not designed for international operations or product manufacturing.
- If you’re an international freelancer, planning a startup, or launching a small business → OÜ is your best choice.
- If you’re launching a large-scale venture with investors and stock issuance → AS is the right structure.
How to Register a Company in Estonia
You can register online via the e-Business Register. The process takes 1–5 days if you have an e-Residency digital ID.
Step-by-step process:
- Decide on the company type.
- Choose and check the availability of the business name.
- Request a local contact person address from GTPartner.
- Use a licensed contact person during registration. Without one, your business may be suspended during a compliance review.
- Begin registration via the e-Business Register — legal assistance is often helpful to clarify requirements.
- If you declared share capital, pay it after submitting your application.
- Pay the state registration fee (at the time of writing – €265).
How to Simplify the Process?
GTPartner.ORG can help you:
- Obtain your e-Residency
- Provide a licensed contact person and legal address for correspondence
- Register your company with the help of an experienced attorney
- Manage your accounting, submit monthly declarations, and file annual reports
- Choose the best structure (OÜ, AS, or FIE) during a free consultation
Expert Tips
- Choose OÜ for buying/selling or providing services as a business.
- AS is the better choice for attracting investors and issuing shares.
- Don’t forget about bookkeeping – penalties for mistakes can be costly.
Conclusion
Estonia offers a business-friendly environment. The most popular option is OÜ, but if you’re planning a larger venture, consider AS. The key is to choose the right structure from the start to ensure smooth operations.
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