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An Estonia company, for nearly every founder from abroad, means an osaühing (OÜ), the private limited company entered in the Commercial Register, which the Centre of Registers and Information Systems (RIK) publishes as the e-Business Register. Owners use it to trade inside the EU and the euro area, as the holding company of a group, and above all as a company run entirely online by people who live elsewhere. The state e-Residency programme, with more than 137,000 applicants from over 170 countries, exists for that: it issues a digital identity with which a foreigner signs company filings from anywhere.
Three Estonian rules shape most decisions: profit is taxed only when it leaves the company, nobody in it has to live in Estonia, and beneficial owner data have been closed to general searching since 10 July 2026. For the other Baltic states, see our overviews of Latvia and Lithuania.
| Estonian form | What it is | Capital set by law | Usual purpose |
|---|---|---|---|
| Osaühing (OÜ) | Private limited company | Share capital of EUR 0.01 per shareholder; below EUR 2,500 of capital, shareholders answer in a bankruptcy for the gap up to that sum | Trading, service and holding companies; the form we sell ready-made |
| Aktsiaselts (AS) | Public limited company | Share capital of EUR 25,000 | Large ventures and planned listings |
| Filiaal | Branch of a foreign company, not a separate legal person | None | A foreign company trading in Estonia under its own liability |
| FIE, täisühing, usaldusühing | Sole proprietor, general and limited partnership | None | Personal liability of the owner or of at least one partner; an FIE must be situated in Estonia |
The online and notary routes to a new OÜ are explained on our page about company formation in Estonia.
| Item | Rule in 2026 |
|---|---|
| Profit kept in the company | Not taxed, whether reinvested or simply held |
| Dividends and other distributions | 22/78 of the net payout, which equals 22% of the gross amount; the rise planned for 2026 was cancelled |
| Dividend paid to a non-resident shareholder | Not taxed further in Estonia; since 2025 every distribution is taxed at 22/78 at company level, the reduced 14/86 rate having ended |
| Payments to board members | 22% income tax and 33% social tax |
| VAT | 24% standard rate since 1 July 2025; registration compulsory above EUR 40,000 of turnover with Estonia as the place of supply in a calendar year |
| Sale of shares | No transfer tax |
| Tax treaties | 70 comprehensive agreements concluded, 66 in force; the EU Parent-Subsidiary and Interest and Royalties Directives apply |
Shareholders and members of the management board (juhatus) may be of any nationality and live anywhere, and one person can found an OÜ and form its whole board. The real constraint is the signature: the Company Registration Portal accepts only an Estonian ID card, the e-resident digital ID, Mobile-ID or Smart-ID, so a founder or board member without one has the company founded through an Estonian notary. e-Residency confers no tax residence and no right to live in or enter Estonia, and first-time applications from Russian and Belarusian citizens are not reviewed.
Since 1 February 2023 a company whose address is in a foreign country must appoint a contact person in Estonia; a company with an Estonian legal address, for instance from a licensed virtual office, needs none. Only a licensed trust and company service provider, an advocate or law firm, a sworn auditor or audit firm, a tax representative of a non-resident or a notary may take the role. Documents reaching the contact person count as delivered to the company, yet the contact person cannot represent it, and a lapsed appointment with no replacement is a ground for deleting the company. If your OÜ will use your address abroad, we can arrange its contact person through a provider holding the Financial Intelligence Unit’s licence for trust and company services; the appointment covers receiving documents only and appears in the commercial register.
Beneficial owners, the individuals holding more than 25% of the shares, votes or ownership interest directly or indirectly, or controlling the company by other means, are named in the founding application; where nobody qualifies, the senior management is recorded. Since 10 July 2026 these data are shown only to authorities, obliged entities such as banks, partners approved by the Ministry of Finance and people who justify a legitimate interest, after logging in with an Estonian or other EU electronic identity.
Estonian law does not oblige an OÜ to bank in Estonia, and many companies owned from abroad do not. The Estonian banks look for a connection with the country, such as clients, partners, staff or property there; one says plainly that e-resident status alone is not enough, and most identify company representatives in person. Payment institutions licensed elsewhere in the EEA, several of which the e-Residency programme lists without a strong-connection condition, are the common alternative. Only credit institutions take part in the Estonian deposit guarantee, which covers up to EUR 100,000 per depositor in each institution, companies included. Each bank’s conditions are on our page about bank accounts for Estonian companies.
Readers who prefer Russian will find the country, with the e-Residency and sanctions points that concern them, on our page Estonia (in Russian).
Our part is practical. We supply ready-made OÜs and register new ones, draft the articles or share sale documents and the register applications, and help the company assemble what a bank or payment institution asks for. Where we have a working contact at a suitable bank, we can introduce you; the bank alone decides on the account. The e-Residency application stays with you, because the programme accepts none through intermediaries.
OÜ is the short form of osaühing, the Estonian private limited company, and each such company carries Osaühing or OÜ in its business name, either first or last. Its public counterpart is the AS, aktsiaselts. In English an OÜ is called a private limited company, or by Americans an LLC. Its shareholders are not liable for its debts beyond their contribution, apart from the EUR 2,500 rule for very low share capital.
For many groups it works well. Dividends and gains the OÜ receives are not taxed while they stay inside it. A holding of 10% or more in a company resident in Estonia, elsewhere in the EU or EEA, or in Switzerland, and not in a low-tax territory, lets the OÜ pass that company’s dividends on to its own shareholders without a second charge. A foreign parent founds the OÜ through an Estonian notary, and the principal purpose test means the structure needs a business reason.
The OÜ is Estonian tax resident because it is incorporated in Estonia, and e-Residency gives its owner no tax residence there. If the business is really run from another country, that country may claim the income too: the United Kingdom, for example, can treat a company centrally managed and controlled there as UK resident. Estonia’s 66 treaties in force resolve such double claims, but it is simplest to know from the start where the board takes its decisions.
Use the e-Business Register run by RIK. A company’s registry card shows its eight-digit registry code, which doubles as its tax number, its date of entry, its management board, any contact person and the term of that appointment, its share capital and whether it was paid, and the annual reports filed. Beneficial owner data are the exception: since 10 July 2026 only authorities, obliged entities and people with a legitimate interest can see them.
Considering an Estonian company? Tell us through our contact page who will own it, who will sit on its board, whether they hold an Estonian-supported digital ID and which address it should use, and we will explain what a new or a ready-made OÜ would involve. Telegram and WhatsApp reach us at +48 663 247 166.