alt Hacker NewsAsk HN: What surprised you about Estonia e-Residency and running an Estonian OÜ?
From the official information online, joining the e-Residency program and setting up an Estonian company seems relatively straightforward.
I'm considering using an Estonian OÜ for a SaaS business and would love to hear from people who have actually gone through the process.
What surprised you after becoming an e-resident and establishing your company? Were there recurring costs, compliance requirements, banking/payment issues, tax complications, or other operational challenges you didn't anticipate?
How easy has it been to run the company remotely? Have you ever needed to travel to Estonia to resolve an issue?
Looking back, would you do it again? What do you wish you had known before getting started?
I'd appreciate any lessons learned, gotchas, or advice from current or former e-residents.
Comments
I was surprised how amazing it is ?
What do you wish you had known before getting started?
How easy has it been to run the company remotely?
Have you ever needed to travel to Estonia to resolve an issue?
Looking back, would you do it again?
Its been a few years but I ran BD for the program in '19-'20 -- I would say that people underestimate the difficulty in shutting down the company if that needs to happen, sometimes getting access to a proper bank account can be annoying, and don't always understand the tax implications (ex. if I was resident in Germany, all my customers were in Germany, but I tried to run everything through this Estonian biz and pay taxes only there, that could very well cause you lots of issues/complications).
Also, shameless plug for people broadly interested in the country of Estonia and how it became a leader in e-gov/tech only a generation after independence from the Soviet Union, I wrote a book about it after being curious myself! https://www.rebootinganation.com/
Please beware:
From: https://learn.e-resident.gov.ee/hc/en-gb/articles/3600007215...
> Corporate tax residency
> However, some countries have different rules for deciding if a company is tax resident. It is common that, in addition to the place of incorporation, the place of effective management can trigger tax residence. If you run your company from a country with regulations like this, then the company may end up having dual tax residence. This happens when two states believe that the company is tax resident in their jurisdiction and will want to tax the company’s profits.
This 'It is common that [...] the place of effective management can trigger tax residence' is indeed common.
UK, USA and Singapore are the popular choices for this. UK is simple and cheaper, Singapore is a bit more expensive. I don’t see a reason to go USA route unless you are seeking investment from there.
I’m using UK myself. It takes a few forms and half a day to get a working Wise/Stripe account.
Where are you located? Where will you administer the company from? That impacts your tax situation quite a lot.
See https://www.e-resident.gov.ee/understanding-cross-border-tax..., look for “Permanent Establishment”
It has been a great experience. Setting up the company was online, and it took 3 days, including the time spent to change the name because the initial name was rejected. You can use Wise for banking, but LHV is also visible but there is an account limit if you don’t live there. Accounting is easy, but you will need an accountant for tax reporting if you have a VAT ID. My accountant charges me 60 euros per month and does an amazing job.
Any tips for a 2 person European company. One founder based in Amsterdam, the other in London. We are close to setting things up, some input from other founders would be great
It was great until they turned racists and stopped me from using the service because of my nationality (Russia), even though neither me or the business had anything to do with Russia.
Question: are OÜs particularly beneficial even for non-Estonians (EU), and in what way?
I think banking is still the biggest issue if you’re not an Estonian resident.
Honestly, I’d avoid the EU in general. There are only about four or five good places to set up a company and stay connected to the financial system: the US, especially Wyoming or Delaware, Dubai, Singapore, and Hong Kong.
Useless + overhyped .
Company will end up as tax resident from the country where it is managed & controlled .
If there is an DTA the tie breaker rule applies and the country from where it is managed & controlled gets the right to tax .
Also you get to enjoy bureaucracy+ dual accounting in both countries .
If there is no DTA it can lead to double taxation .
And if you don't have a fixed place of management/business+ tax residency (basically nomading) a US LLC disregarded for tax purposes is a much better fit .