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Become Estonia’s e-resident

e-estonia.com

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Re: Become Estonia’s e-resident

#61

Post by agilebyte »

alvarosm wrote: post #59
agilebyte wrote: post #50

Earlier quoted context omitted.

If you want to pay taxes only in Estonia, consult a Double Tax Treaty between Estonia and your country of physical residence. Usually you would be able to employ a person in Estonia to close deals/contracts to qualify. But read the document. As soon as you distribute the profits, 10% tax applies from the Estonian end.

Usually, if your country has a DTA with estonia you'll have to pay whatever your country takes for dividend distributions anyway. The DTA means you can pay 10% to Estonia and the rest to your country but in total you're still paying whatever your country wants, in total. There might be other advantages, however, but repatriating dividends is not going to be one of them.

Exactly, so you keep the money in the company, reinvesting the profits (and repatriate when you are a resident of say Bahamas or BVI if you build up quite a nest egg).

Re: Become Estonia’s e-resident

#62

Post by _delirium »

xmpir wrote: post #2

What exactly can one do with this digital identity?

It's an ID/credential system that government and financial services will be using. So you'll be able to use the ID/credentials to log in and interact with Estonian entities that use it, like banks, tax authority, corporate registry, etc. Vaguely like an OpenID identity, but run by the Estonian government, and with two-factor authentication.

It doesn't in itself give you any specific rights, as far as I can tell ("e-residency" is a bit of a marketing term). It just makes it easier to do things that foreigners are theoretically allowed to do, but which aren't currently very easy to do remotely. For example it's already legal for a foreigner to register a company in Estonia, but it's a bit of a hassle if you aren't an Estonian resident; this is supposed to make it easier, because you'll be electronically "in the system" with a proper ID number and login, making it easier for agencies and financial institutions to know how to deal with you. Especially since it's combined with a move towards self-service online portals for government services, so you should be able to log in with this ID and do a lot of things over the internet, instead of visiting civil-service offices.

Here (Denmark) all that is also theoretically true—anyone with legitimate business in Denmark can get an ID, and once you have one you can do things like register a company entirely online, self-service, as well as interact with banks and anyone else who implements the "NemID". But in practice the authorities are very suspicious of anyone not living in Denmark trying to get into the system, so almost the only non-residents who do so are Swedes and Germans who either commute cross-border or have frequent business in Denmark.

Re: Become Estonia’s e-resident

#64

Post by pdabbadabba »

plainOldText wrote: post #27

I believe this has huge implications for someone who would want to operate a company from a business friendly country, as opposed to say a country where the individual is located physically but is otherwise corrupt or war ridden. My understanding is that this status allows you to form companies, open bank accounts and sign binding documents just like someone living in Estonia. And that is pretty impressive. Add crypt…

I agree this is interesting, but the problem is that there is nothing to stop the government of the country in which you physically reside from having different ideas about what laws govern your dealings.

If the country you are physically in wants to (e.g.) tax you, they can. (There are, of course, many more nefarious possibilities than taxation.) This is, I think, true in an "in accordance with international law" sense (though there is the possibility that a bilateral double taxation treaty might apply) and it is certainly true in a "who's to stop them" sense. (And if we're hypothesizing that the person is physically located in a corrupt/war torn country, the latter would probably be all that matters anyway.)

Re: Become Estonia’s e-resident

#65

Post by jkaljundi »

_delirium wrote: post #62
xmpir wrote: post #2

What exactly can one do with this digital identity?

It's an ID/credential system that government and financial services will be using. So you'll be able to use the ID/credentials to log in and interact with Estonian entities that use it, like banks, tax authority, corporate registry, etc. Vaguely like an OpenID identity, but run by the Estonian government, and with two-factor authentication. It doesn't in itself give you any specific rights, as far as I can tell ("e-r…

Actually many private entities use it as well. It's an authentication layer anyone can easily implement. Same for digital signatures.

Re: Become Estonia’s e-resident

#66

Post by pdabbadabba »

toomuchtodo wrote: post #20
jkaljundi wrote: post #9

Earlier quoted context omitted.

Some background information here: http://e-estonia.com/taavi-kotka-promises-10-million-e-eston... Although the first stages will be more towards foreigners who conduct any business in Estonia, the next stages should allow appearance of new business models and internationally operated activities headquartered and registered in Estonia.

The Delaware of the world.

This actually points out a huge challenge for Estonia. As well as the tax advantages, another (and perhaps the primary) reason businesses incorporate in Delaware is their extremely well developed (and business friendly) body of corporate law (the stuff that governs the relationship between shareholders and the corporation, duties of a board of directors, that sort of thing) and a judiciary that is highly efficient in resolving internal corporate disputes. If you study corporations in any law school in the U.S., they will teach you Delaware law, regardless of what state you are actually in.

I would love to see Estonia take on this challenge as well, but it will take a long time and concerted effort.

Re: Become Estonia’s e-resident

#67

Post by markvdb »

memnips wrote: post #34

Is there a tax advantage here? Estonia's tax system is supposed to be very simple, and allows for a 0% corporate income tax on all profits that are re-invested into the corporation (source: http://www.incorporate.ee/why-estonia/low-tax-jurisdiction ). Does this mean I can form a corporate entity in Estonia and gain all the tax benefits without any physical presence?

You will have to be very very careful about making Estonia the real physical center of the commercial activities deployed by your company.

If you don't - let's say you're Dutch, living in Holland and consulting mostly for Dutch clients, then forget it.

But let's say you're Dutch, you have a girlfriend in Estonia, you work from there a week every month, and you have clients in several EU countries, with NL only one of them... Maybe you even have a local employee in Estonia. That will work no problem.

Re: Become Estonia’s e-resident

#68

Post by anemic »

tvanantwerp wrote: post #4

"To apply for one, you need to make visit a Police and Border Guard office in Estonia – there you need to submit an application and provide biometrical data (your facial image and fingerprints) for background check."

are the facial image and fingerprints only used for background check, are they stored (and for how long) and are they shared with different entities, such as police or foreign governments?

Re: Become Estonia’s e-resident

#69

Post by yurylifshits »

ikawe wrote: post #11

I was in Estonia two days ago. I just passed through on a whim as part of a European bicycle tour. I am embarrassed to admit, I knew very little about the country before being there. I was only there a week, so my impressions are addmittedly naive, but very positive. There was a lot of technology forward thinking - online voting, constitutional right to internet access, co-working spaces catering to young entrepreneu…

Most of Skype early development was made in Estonia.

Re: Become Estonia’s e-resident

#70

Post by namenotrequired »

ikawe wrote: post #11

I was in Estonia two days ago. I just passed through on a whim as part of a European bicycle tour. I am embarrassed to admit, I knew very little about the country before being there. I was only there a week, so my impressions are addmittedly naive, but very positive. There was a lot of technology forward thinking - online voting, constitutional right to internet access, co-working spaces catering to young entrepreneu…

Excuse the OT, I'm considering a visit. As a foreigner with no connections, how do you recommend I could get a feel for the startup scene there (as you seem to have done)?

> Anyone doing any cool projects there?

One Estonian startup whose product I use a lot is TransferWise, here's an invite link (for one free currency transfer):

https://transferwise.com/u/5d78

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