Frequently Asked Questions
Everything you need to know about e-Residency, Estonian companies, taxes, and service providers.
e-Residency is a digital identity issued by the Estonian government that allows you to start and manage an EU company 100% online. It does not grant physical residency, citizenship, or the right to live in Estonia.
The total first-year cost is typically €1,200-2,500. This includes the e-Residency card (€150 state fee), company registration state fee (€265 plus a €25 + VAT registry service fee), service provider setup (€0-390), and monthly service fees (€59-199/month). Use our Cost Calculator for a personalized estimate.
No. e-Residency does not change your tax residency. You remain tax resident in the country where you physically live. Estonia's 0% corporate tax on retained profits applies to the company, but salaries and dividends are taxed according to local rules.
Partially. Estonian companies pay 0% corporate tax on retained profits — money kept in the company. However, when you distribute profits as dividends, a 22% tax applies (calculated as 22/78 of the net distribution; the former 14% reduced rate was abolished in 2025). Salaries are taxed at 22% income tax plus 33% social tax.
Yes. Most e-Residents use Wise Business (formerly TransferWise) as their primary business account. It's free to open, supports multi-currency, and integrates well with providers like Xolo. Traditional Estonian banks (LHV) are possible but harder to access remotely.
The e-Residency application takes 3-8 weeks for processing. After picking up your card, company registration through a service provider takes 1-2 weeks. Total: roughly 5-10 weeks from application to first invoice.
Xolo is more established (larger team, better dashboard, Wise/Revolut integration) and its Leap plans start at €59/month (tiered up to €259/month as you grow, ex VAT). Companio charges a flat €89/month (PRO) with a €390 setup fee. For most freelancers billing €2,000+/month, Xolo is the better value.
Yes. Your company is registered in Estonia, not with the provider. Switching takes 2-4 weeks and involves transferring accounting data. Your company name, registration number, and bank accounts stay the same.
VAT registration is mandatory once your Estonian company's taxable turnover exceeds €40,000 in a calendar year. If you primarily sell B2B services to EU clients, you may want to register voluntarily to reclaim input VAT. Your service provider can advise on this.
Every Estonian company must file an annual report within 6 months after the fiscal year ends (typically by June 30). Your service provider prepares this for you — it's included in most plans. The report covers the company's financial statements and activities.