E-Residency vs tax residency
This is the #1 misunderstanding: Estonian e-Residency does NOT make you a tax resident of Estonia. E-Residency allows you to start and manage an EU company remotely. You still pay personal income tax wherever you actually live. The digital nomad visa is separate and does establish physical presence.
Estonia's unique corporate tax
Estonian companies pay 0% corporate tax on retained earnings — tax is only paid when profits are distributed (20% on distributions). This makes Estonia attractive for reinvesting business profits. However, your personal tax on distributed profits depends on where YOU are tax resident.
Planning your move to Estonia?
Get a personalized tax breakdown based on your home country and income sources.
Digital nomad visa taxation
If you're on the digital nomad visa and become tax resident in Estonia (183+ days), you're taxed on worldwide income at a flat 20%. Estonia has no progressive tax brackets — 20% flat rate for all income levels.
Social security
If you're self-employed in Estonia, social contributions are approximately 33% on top of income tax. This covers health insurance and pension. EU citizens may maintain home country social security through A1 certificates.
VAT for e-Residency companies
Estonian companies must register for VAT when EU sales exceed €40,000. VAT rate is 22%. For B2B services to other EU countries, reverse charge applies. For B2C, you may need to register under OSS.