Accounting Estonia, Estonia, Licences and permits

Licences and permits in Estonia – when will you need one?

2020-07-09

When you set up a company abroad, it is necessary to analyse, at the very beginning of the registration process, whether it is necessary to obtain a licence or permission for your type of activity. This is particularly important because each country in the European Union has different regulations for particular types of business activity subject to regulation and licencing. It is worth noting that in some cases one of the requirements is to operate in a certain legal form, ex. as a Joint Stock Company or to have a certain share capital. Therefore, it is worth consulting your plans with a law firm before starting your business to avoid costly mistakes at later stages.

Company in Estonia. For whom is this a good solution?

Establishing a company in Estonia is a particularly good solution for new technologies industry.  Thanks to effective legislative processes and transparent legal environment, it is beneficial for cryptocurrency exchange or token issuing companies. What’s more, setting up a company in Estonia is also much easier and cheaper for firms active in traditional industries such as finance and shipping.

Accounting Estonia, Estonia

When Estonian company should be subject to an audit?

2020-06-26

An audit is a detailed examination of the company. The auditor assesses correctness of the annual financial statement, which represents the economic situation of the company in a reliable and credible way.

Criteria that determine the audit obligation
The matter of audit and Review is regulated in the Estonian “Audit Activities Act”.

Mandatory audit concerns entities which have shown at least two of the following values in their annual report:

Sales revenues of more than EUR 4 000 000;
Total assets of more than EUR 2 000 000;
Average number of employees at least 50.

Estonia, VASP

Interview for Nooor Blockchain Armenia

2020-06-18

We were invited to the Nooor Talks Series, where our Senior Partner, Artur Kuczmowski, briefly talked about how Poland is getting over the issues resulted from the pandemic and expreded his thoughts on stablecoins, and the biggest challenge of blockchain technology.

The Polish government spent PLN 1.5 billion to help entrepreneurs during the crisis. They focused mainly on protecting jobs and maintaining financial liquidity. What is more, the Polish Development Fund in cooperation with banks has created a revolutionary program aimed at maintaining financial liquidity during the coronavirus pandemic, Senior Partner recalls.

Accounting Estonia, Estonia

Shareholder structure in the Estonian OÜ company

2020-06-15

By establishing the Estonian OÜ company, each founder must make important decisions with respect to the newly created legal entity. The matters which should be taken into account include the amount of share capital, the personal composition of the management board and most importantly the shareholder structure.

Who can become a shareholder in OÜ?

When analyzing the issue of the shareholder structure in the Estonian OÜ company, many people wonder how to properly construct it. Similarly, to other countries e.g. Poland, there is freedom of choice here. The shareholders of the newly created entity can be both natural and legal persons (individuals and entities). There are also no restrictions on their residences. Thus, foreigners are allowed to own 100% of the company’s shares. Depending on the adopted shareholder structure, it will be necessary to provide various documents before registering the Estonian company.

Accounting Estonia, Estonia

Dividend from the Estonian company – rules of distribution

2020-06-10

Verify if the company has paid-up share capital
In order to pay out a dividend from an Estonian company the minimum share capital of 2500 euros has to be paid in advance. When establishing a company in Estonia, you have the possibility to postpone the payment of the share capital until after the whole process of registration is completed. This may lead to a situation in which the company operates despite unpaid share capital. Therefore, before you decide to pay out a dividend make sure that the share capital had been fully paid.

Make sure you have met all the formal requirements
The payout of dividend is made on the basis of the financial result shown in the annual report. That’s the reason why the company’s annual report has to be accepted and signed by all members of the board. In addition, make sure that the amount you wish to pay out does not exceed the retained/not distributed profit shown in the company’s annual report. Moreover, you should ensure that after the pay out of the dividend company’s net assets will not fall below the value of the paid-in or minimum share capital – depending on which of these values is higher. If you met all the conditions mentioned above, you can proceed to the next step.

Accounting Estonia, Estonia

We joined the Association of Estonian Accountants

2020-06-05

In order to provide the highest quality of our services, we are constantly aiming to strengthen our position in the accounting area. Thus, we are glad to inform you about us joining the Association of Estonian Accountants (AEA). By participating in the organization, we have the opportunity to engage in an active discussion on the changes in Estonian tax law, as well as express our opinion. Moreover, by participating in the AEA we will be able to take part in discussions with the Ministry of Finance on the continuous development of accounting area.

The AEA was founded in 1996. The organization unites more than 650 members, which include both natural and legal persons. The aim of the association is to educate and qualify accountants. Moreover, it actively engages in a dialogue with the government on the development of accounting.

Estonia, Liquidation of the company

Liquidation of OÜ company in Estonia

2020-05-13

During current economic slowdown, more and more entities conducting business activity are experiencing difficulties with financial liquidity. Economic constraints, reduced demand and rising inflation are clear signs of the impending economic crisis. Many entrepreneurs are forced to make a difficult decision to liquidate the company.

Liquidation of the company as a long-term and requiring process
First of all, it should be noted that the liquidation of the company is a long-term process, lasting a minimum of 6 months. During this period, a number of required legal and accounting activities should be undertaken. We mean, among others, preparation of the opening and closing balance sheet, as well as the obligation to satisfy the creditors of the liquidated company itself. It should be known that detailed regulations regarding the liquidation of a company are set out in the Estonian Commercial Code.

Accounting Estonia, Estonia

Expenditures of the OÜ company in Estonia. When do you have to pay tax on it?

2020-04-20

The Estonian CIT structure, which is collected only at the time of distribution of profits, also required the implementation of mechanisms that counteract hidden dividend payments. Seemingly, it is easy to classify expenses that are necessary to ensure business continuity and work efficiency. However, very often entrepreneurs are not aware at the time of the transaction that they thereby generate a taxable purchase. We decided to facilitate this by preparing a list broken down into those expenses that do not require the payment of taxes and those on which you must pay corporate income tax. We want to stress that our list presented below is general, and expenditure should always be assessed on a case-by-case basis, taking into account the company’s activities.
Untaxed expenditures incurred by the OÜ company in Estonia

Estonia

Is it possible to ‘hack the crisis’? Estonia knows the answer

2020-04-09

Estonians strongly believe that technology can help to effectively mitigate the effects of the crisis. Inspired by the success of online hackathon ‘Hack the crisis’ in March they decided to organize massive global movement called ‘The Global Hack’ which has started today (9.04.2020).

In times of COVID-19 pandemic Estonia once again proves that it deserves to be called a start-ups hub and the most digitized society. While the doctors take care of sick people, Estonian government in cooperation with the private sector works on e-solutions which are needed to minimize coronavirus’ socio-economic impact.

Estonia, Estonia

How to set up a company in Estonia?

2020-03-23

No one needs convincing that company in Estonia is the best solution for entrepreneurs who are running their business in the international market. No matter which of the above you choose, setting up a business with us will allow you to avoid the cost of travelling the Tallinn. Key factors when choosing right path are length of the registration and new company structure.

Company registration by power of attorney
It is the best solution for people who care about time or plan a more complicated shareholder structure. Granting us a notary power of attorney allows our law firm to perform for the client all the activities needed to register the company. This process takes a maximum of two weeks. You do not have to come to our offices. The power of attorney can be certified with any notary, based on the template prepared by us. The most important thing is that it should be sent to us as soon as possible in the original.