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How to register a company in Estonia: A guide for employers

Grow your team in Estonia
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Think of Estonia as your gateway to Europe—minus the hassle.

With a digital-first approach, Estonia is transforming the way businesses expand. Its tax-friendly policies, streamlined registration process, and innovative E-residency program make it easy to manage your operations remotely without needing a physical presence. Estonia is where simplicity meets opportunity, giving you the freedom to grow and scale in one of Europe’s most business-friendly environments.

The business benefits of registering your company in Estonia 

Estonia has reshaped global business operations with its tech-forward, streamlined processes. For HR and business leaders, it’s easier than ever to handle everything from compliance to payroll. 

Here’s why Estonia is an excellent choice for expanding your business:

  1. Retain profits for growth and innovation with zero tax on reinvested earnings.
  2. Register your company online from anywhere—fully digital, no paperwork needed.
  3. Manage your business remotely with e-residency and a global digital ID.
  4. Start without upfront capital—no minimum investment required.
  5. Focus on growth with clear, streamlined compliance regulations.
  6. Expand easily into Europe’s single market with full EU access.

Estonia offers a low-risk, high-growth opportunity for companies looking to expand into Europe.

Next, we break down the options—Estonia’s e-Residency, standard company registration, and Employer of Record (EOR)—so you can find the approach that works best for your needs.

What is the difference between E-residency and standard company registration and EOR?

Estonia offers three key options for establishing a business, each catering to different needs.

Aspect

E-Residency

Standard Registration

Employer of Record (EOR)

Purpose

Provides non-residents with digital access to Estonian e-services and remote company management.

Establishes a legal entity, granting full control over operations and finances.

Allows hiring in Estonia without entity setup; the EOR handles compliance and employment.

Control

Offers full decision-making and management within Estonian laws.

Provides complete operational and financial control.

Operational control over employees; EOR manages administrative and legal tasks.

Compliance

Requires adherence to Estonian tax laws and annual reporting.

Full responsibility for compliance with all local laws and regulations.

EOR ensures compliance with labor laws, taxes, and reporting.

Setup Time

Fast, as it’s fully digital.

Longer, due to documentation and legal procedures.

Quick, enabling immediate hiring and operations.

Cost

Involves fees for e-Residency, company registration, and compliance.

Includes entity setup costs, legal fees, and operational expenses.

Service fees to the EOR, often more cost-effective than entity setup.

Scalability

Ideal for small businesses needing remote management.

Best for long-term, substantial physical operations.

Highly flexible for workforce scaling without the need for an entity.

While E-Residency provides a digital EU foothold and standard registration offers full control, an EOR stands out for quick, compliant workforce expansion without the need to set up a legal entity. EOR simplifies employee onboarding and ensures regulatory compliance.

Let’s explore how EOR streamlines registration and hiring.

How EOR simplifies Estonia company registration

Expanding into Estonia in 2025 can be straightforward with the right support. An Employer of Record (EOR) offers an efficient approach to setting up operations, onboarding local talent, and ensuring compliance—all without the need for a legal entity. 

Here’s how an EOR helps businesses entering Estonia:

  1. Avoid lengthy setup processes with an EOR, which acts as your legal employer and lets you focus on growth immediately.
  2. Eliminate the burden of payroll, taxes, and filings, as an EOR handles all administrative tasks for your team.
  3. Stay compliant with Estonia’s labor laws through the EOR’s expertise, ensuring peace of mind and protection from legal issues.
  4. Save costs by skipping entity setup, allowing you to redirect funds toward business operations and growth.
  5. Scale your team as needed with the flexibility to adapt to market shifts without long-term commitments.
  6. Access Estonia’s skilled talent pool without the challenges of local hiring practices or geographic limitations.
  7. Provide competitive, locally compliant benefits to attract top talent, with the EOR managing all administration.
  8. Minimize legal and compliance risks while expanding confidently with the EOR’s comprehensive support.

Step-by-step guide to registering a company in Estonia

Estonia’s streamlined process makes setting up a business surprisingly simple. Here’s how to get started and handle each step with ease.

Step 1: Apply for E-Residency (Optional)

Estonia’s e-Residency program offers a digital identity to non-residents, enabling access to the nation’s e-services and the ability to manage a company remotely. While not mandatory for company registration, e-Residency simplifies the process, especially for those planning to operate without a physical presence in Estonia.

How to Apply: Submit an online application through the e-Residency portal. The process includes identity verification and a background check. Once approved, you’ll receive a digital ID card, which can be collected from designated pickup locations worldwide.

Step 2: Choose the right business entity and name

Setting up a local entity in Estonia can be time-consuming and complex. However, you can skip the hassle with an Employer of Record (EOR). 

An EOR like Multiplier eliminates the need for entity registration by acting as your legal employer. The EOR handles contracts and onboarding employees, managing payroll, tax filings, and ensuring compliance with local laws—all while you focus on growing your business.

If you’d still like to go ahead and create a business entity, then selecting the appropriate business structure is crucial, as it influences your company’s legal obligations, tax liabilities, and operational flexibility.

  • Common business entities:
    • Private Limited Company (OÜ): Ideal for small to medium-sized enterprises, offering limited liability to shareholders.
    • Public Limited Company (AS): Suitable for larger businesses aiming to raise capital through public offerings.
    • Sole Proprietorship (FIE): For individual entrepreneurs; however, it entails unlimited personal liability.
  • Naming your company: Ensure your chosen name is unique and complies with Estonian naming conventions. You can verify name availability using the Business Register’s name query service.

With an EOR, you bypass the complexities of entity setup and gain a faster, more flexible way to scale your operations in Estonia.

Step 3: Prepare and submit the necessary documentation to the Estonian business register

Once you’ve decided on your business structure and name, the next step is to compile and submit the required documents.

  • Required documents:
    • For e-residents:
      • Digital ID (e-Residency card)
      • Articles of Association
      • Founders’ data (personal identification and contact information)
      • Management board members’ data
      • Confirmation of the legal address in Estonia
      • Consent of the contact person (if applicable)
    • For non e-residents:
      • Notarized and apostilled copies of personal identification
      • Proof of address
      • Articles of Association
      • Founders’ data
      • Management board members’ data
      • Confirmation of the legal address in Estonia
      • Consent of the contact person (if applicable)
  • Submission process:
    • Online: E-Residents can register their company online through the Company Registration Portal.
    • Via notary: Non E-Residents or those preferring in-person registration can do so through a notary in Estonia.

Step 4: Open a business bank account in Estonia

A local bank account is essential for managing your company’s finances, including receiving payments and handling expenses.

  • Options:
    • Traditional Banks: Estonian banks like Swedbank and SEB offer business banking services.
    • Fintech Solutions: Digital banks such as Wise and Revolut provide online business accounts, which can be more accessible for non-residents.
  • Requirements:
    • Company registration certificate
    • Articles of Association
    • Identification documents of the company’s representatives
    • Proof of business activities

Opening a local bank account isn’t always easy, but Multiplier’s global payroll solution makes it simple to manage your finances without one. With Multiplier, you can:

  • Run payroll in multiple currencies.
  • Stay compliant with local tax laws.
  • Eliminate the risks and complexity of managing global payroll.

Multiplier takes the stress out of payroll and compliance so you can focus on building your business. It’s the smarter, faster way to expand into Estonia.

Step 5: Register for tax and compliance purposes

Ensuring compliance with Estonian tax laws is vital for your company’s operations.

  • Tax Registration:
    • Value Added Tax (VAT): If your annual taxable turnover exceeds €40,000, VAT registration is mandatory. You can register through the Tax and Customs Board.
    • Employment Taxes: If you have employees, register as an employer to handle payroll taxes and social security contributions.
  • Compliance:
    • Maintain accurate accounting records.
    • Submit annual reports to the Business Register.
    • Adhere to employment laws and regulations.

The next step is understanding the costs involved. Let’s dive into the cost breakdown for registering a company in Estonia.

The real cost of registering a business in Estonia

For entrepreneurs planning to set up a business in Estonia, here’s a simple breakdown of the costs to help you prepare:

  1. Registration costs
  • State fee: It costs €265 to register a private limited company (OÜ) online.
  • Share capital: A minimum of €2,500 is required, though payment can be deferred.
  • Legal address and contact person: Non-residents need these services, which typically cost €200 each per year.
  • Notary fees: If you choose in-person registration, fees range from €50 to €200.
  1. Annual maintenance costs
  • Accounting services: Starts at €19 per month, depending on your company’s activity.
  • Annual reports: Filing costs begin at €149 per year.
  • Taxes: Estonia taxes profits only when distributed; VAT registration (20%) is required if turnover exceeds €40,000.
  • Legal address renewal: Around €200 per year to maintain your address and contact person.
  1. Additional considerations
  • E-residency fees: Applying for e-residency costs €100 to €120, depending on the pickup location.
  • Banking services: Fees vary, with fintech providers offering flexible online options.

An employer of record (EOR) eliminates most of these costs and administrative tasks, seamlessly managing payroll, taxes, and compliance—all for a single, predictable fee.

Let’s take a closer look at the cost of standard registration vs EOR. 

Cost Comparison: Standard Registration vs. EOR

Here’s a quick look at the cost differences between standard company registration and using an employer of record (EOR).

Cost Comparison: Standard Registration vs. EOR

While the traditional registration route involves a one-time setup cost and ongoing administrative fees, an EOR can help bypass the real cost of international hiring with predictable monthly fees that cover most compliance and operational responsibilities.

Next, let’s look at how a partnership with an EOR, such as Multiplier, can simplify and accelerate your business expansion into Estonia.

Take the stress out of your Estonian expansion with Multiplier

Expanding your business into Estonia doesn’t have to mean complex processes and heavy administrative work. With Multiplier’s employer of record (EOR) solution, you can focus on growth while we handle the complexities.

Why Multiplier is your go-to for Estonia:

  • Hire like a local, expand like a global: Tap into Estonia’s tech-savvy talent pool with ease. Our local HR experts handle everything from compliant contracts to smooth talent boarding, giving you the confidence to grow across borders.
  • Payroll that flows effortlessly: Manage payroll with real-time accuracy and transparency. Multiplier ensures taxes, contributions, and payouts align perfectly with Estonian regulations, so you never miss a beat.
  • HR that unifies everything: From onboarding to expenses, approvals to time-off management, Multiplier’s all-in-one platform gives you complete visibility and control over your distributed teams in Estonia.
  • Compliance without compromise: Navigate Estonia’s labor laws and tax codes with our proactive compliance approach. Whether it’s VAT thresholds or employee protections, we’ve got your back.
  • Benefits that stand out: Attract and retain Estonian talent with competitive, locally tailored benefits packages. Multiplier handles the administration, so your team gets what they need without added hassle.
  • Support that moves at your speed: Our 24/5 human-first support ensures you and your employees always have a trusted partner on hand. With GDPR compliance, SOC 2 certifications, and AWS-backed security, your operations are in safe hands.

Multiplier delivers more than just compliance—it creates a seamless expansion experience that’s tailored to your business goals. From simplifying payroll to enabling global scalability, we make your growth in Estonia effortless.

Book a Demo today and see how easy expanding with an EOR can be.

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