The Estonian private limited liability company (OÜ) is the most common form of business as its shareholders have no personal liability for the company’s obligations. At the same time, the minimum authorised share capital is required to be at least 2500 EUR.
Estonian legislation does not set up requirements for the number founders and Board members. They can be both Estonian residents or non-residents. The founders of the Estonian company invest their capital in the company’s share capital and receive dividends according to the number of shares they own. The members of the Board are not entitled to receive dividends, but are selected to manage the Estonian company.
Corporate profits are not taxed (tax rate 0%) unless or until the profits are distributed as dividends; all undistributed corporate profits are tax-exempt.
The VAT rate on the export of goods is 0%. If the annual taxable turnover exceeds 16 000 EUR you will need to register at the Tax and Customs Board as a VAT payer. Thus, the Estonian company gets the features of a classic offshore company, but at the same time, is registered in a European country.