How To Start A Remote Company
No taxes on revenue as long as it stays in the company AND no taxes for the company on employee salaries.
If you are considering a life as a digital nomad or online entrepreneur chances are you might be asking yourself how to establish your business and whether you should create a company or not.
This is exactly the question my partner and I were trying to answer back in 2019 as we were planning to sell our things and start a life as slowmads (staying in one place/city for a few months to half a year).
During our research, we came across the e-Residency program created by the government of Estonia which fit our plans quite well.
What is e-residency?
Estonia offers you the possibility to become an e-resident. This is not to be confused with being an actual resident of the country.
The program is open to all countries and once accepted, it offers you the possibility to create and manage a company 100% online plus other benefits that I will explain further below.
How to apply for e-residency
The process is quite straightforward.
You will need an ID, a passport-style digital photo, and a motivation statement. There is also an application fee of €100 –120.
The application review can take 3–8 weeks and in the process, you might be asked for additional information. I got my answer within 2 weeks, but it depends on their backlog.
Once you receive the answer that you were granted an e-Residency, you will need to pick up the e-Residency card from an Estonian embassy.
I picked mine up in my country of origin, but you can ask to pick yours up at an Estonian embassy closest to you. You can find all the info on their website https://www.e-resident.gov.ee/.
How to create a company
Once you have the e-resident card, you can start creating your company.
Several businesses offer these services, you just need to look around and see what works best for you.
My partner and I both created our companies with Xolo and so far they have lived up to our expectations.
The process with them is fairly simple and they will advise you throughout each step until your company is established and you can start your activity.
If you wish to create your company with Xolo, you will receive a €100 starting bonus using this link https://www.xolo.io/ref/CRIMIH.
Benefits of creating a company as an e-resident of Estonia
- Quick and simple application process.
- No taxes are paid on revenue as long as the revenue stays in the company. You will pay taxes if you pay yourself dividends, and at the moment this is 20%.
- No taxes for employee salaries. This applies to the company, meaning that as an individual you will have to pay taxes in your country of residence, but the company does not pay taxes for your salary.
- Possibility to create a Wise (formerly TransferWise) business account and get paid in different currencies.
- Possibility to create a European company for non-Europeans.
Disclaimer: This article contains an affiliate link which means that if you sign up via this link, I will make a commission, at no cost to you.
If you would like to read more, and support stories like this, consider joining Medium via this link and follow me.
