Estonia Corporate Rules: Can this Tax structure work?

[HeinzKetchup69]

I'm moving to Europe for around 2 years to stay close to a sick family member, after that I'll move to the UAE but for now I have to remain close to the EU.
i have a EU passport but have not been in europe for over 12 years. Never had a job there, never paid any tax there. I left when I was 16 and in high school.

Would it make sense to move to a country like Est-onia that doesn't tax corporate profits until they are distributed with the current set up?

- Continue to operate my current UAE Company from Est-onia
- Pay my self quarter dividends and pay the 20% flat dividend tax fee to Est-onia
- After living those 2 years in Est-onia, move back to the UAE or other country that doesn't tax foreign income and continue operating as usual


Est-onia wouldn't bother much taxing my UAE structure since I would keep all profits in there, and already pay the 20% income tax on the distributed profits, correct?
I don't think they would tax the entire corporate profits of the UAE company the moment i stop being an Est-onian tax resident after those 2 years?

 

[Don]

I'm moving to Europe for around 2 years to stay close to a sick family member, after that I'll move to the UAE but for now I have to remain close to the EU.
i have a EU passport but have not been in europe for over 12 years. Never had a job there, never paid any tax there. I left when I was 16 and in high school.

Would it make sense to move to a country like Est-onia that doesn't tax corporate profits until they are distributed with the current set up?

- Continue to operate my current UAE Company from Est-onia
- Pay my self quarter dividends and pay the 20% flat dividend tax fee to Est-onia
- After living those 2 years in Est-onia, move back to the UAE or other country that doesn't tax foreign income and continue operating as usual


Est-onia wouldn't bother much taxing my UAE structure since I would keep all profits in there, and already pay the 20% income tax on the distributed profits, correct?
I don't think they would tax the entire corporate profits of the UAE company the moment i stop being an Est-onian tax resident after those 2 years?

Estonia might be a great choice, as you may be able to avoid Estonia tax residency, provided certain conditions are met.
In such way you just get the better from the EU legal residency (ID card, banking, credit), but pay taxes only in UAE if any at all.

 

[HeinzKetchup69]

Estonia might be a great choice, as you may be able to avoid Estonia tax residency, provided certain conditions are met.
In such way you just get the better from the EU legal residency (ID card, banking, credit), but pay taxes only in UAE if any at all.

How can you avoid Estonia Tax residency if you spend 8-9 months a year in Estonia?
Either way I'm happy to pay 20% income tax on a 100,000 Euro salary for a couple of years and keep all my profits within my company and reinvest them, then when I move out of Estonia, business as usual with my offshore company and I star to pay zero income tax once again.

 

[Don]

How can you avoid Estonia Tax residency if you spend 8-9 months a year in Estonia?
Either way I'm happy to pay 20% income tax on a 100,000 Euro salary for a couple of years and keep all my profits within my company and reinvest them, then when I move out of Estonia, business as usual with my offshore company and I star to pay zero income tax once again.

This is based on the bilateral treaty and the Center of Vital Interests...
As you have no prior ties to the country, you can claim that your life is more centred in the UAE, and thus, the authorities will accept your application to treat you as a non-tax resident.

 

[HeinzKetchup69]

This is based on the bilateral treaty and the Center of Vital Interests...
As you have no prior ties to the country, you can claim that your life is more centred in the UAE, and thus, the authorities will accept your application to treat you as a non-tax resident.

Well the center of "vital interest" would be Estonia I presume? since I'd be moving my kids, my wife, my dogs there and live there 8-9 months out of the year. I can't jet skiing around the world with 2 kids and 3 dogs and a moany wife, it's extremely time draining and expensive hence I'm looking to "move" everything into a new more affordable and tax favourable place. I have to be in Europe only for 2 years (approx).

What else are you trying to say, that I can claim I'm a UAE tax resident while living in Estonia full time?

 

[Don]

Well the center of "vital interest" would be Estonia I presume? since I'd be moving my kids, my wife, my dogs there and live there 8-9 months out of the year. I can't jet skiing around the world with 2 kids and 3 dogs and a moany wife, it's extremely time draining and expensive hence I'm looking to "move" everything into a new more affordable and tax favourable place. I have to be in Europe only for 2 years (approx).

What else are you trying to say, that I can claim I'm a UAE tax resident while living in Estonia full time?

Most likely yes.
Tax planning is quite nuanced and such details can indeed make a big difference. This is why you might not find the best answer online, and it might be worth discussing with a professional.

 

[toums]

Well the center of "vital interest" would be Estonia I presume? since I'd be moving my kids, my wife, my dogs there and live there 8-9 months out of the year. I can't jet skiing around the world with 2 kids and 3 dogs and a moany wife, it's extremely time draining and expensive hence I'm looking to "move" everything into a new more affordable and tax favourable place. I have to be in Europe only for 2 years (approx).

What else are you trying to say, that I can claim I'm a UAE tax resident while living in Estonia full time?

Then Go in Malta or Cyprus. Or Budapest and pay 15%.

Not lot of option in EU.

 

[cyprusbanker]

How much dividend to you plan to take every year? In Cyprus you can take out dividend as you like as I read in many of the threads around here!

 

[HeinzKetchup69]

How much dividend to you plan to take every year? In Cyprus you can take out dividend as you like as I read in many of the threads around here!

Just 100,000 Euro a year, enough to get by for a family of 4 nowdays.

 

[SoNewToAllShit]

Just 100,000 Euro a year, enough to get by for a family of 4 nowdays.

Did you consider Cyprus ?

 

[Don]

Just 100,000 Euro a year, enough to get by for a family of 4 nowdays.

Maybe some wealthy nominee sheikh will gift you this money?
In Estonia, gifts received in a personal capacity are tax-free and not declarable.

 

[ilke]

Maybe some wealthy nominee sheikh will gift you this money?

Do you think this would be at all believable? In a hypothetical situation, who would have the burden of proof? I.e., if the Estonian tax authorities wanted to fight your statement that a sheikh is gifting you about 100K EUR per year

In Estonia, gifts received in a personal capacity are tax-free and not declarable.

 

[Don]

Do you think this would be at all believable? In a hypothetical situation, who would have the burden of proof? I.e., if the Estonian tax authorities wanted to fight your statement that a sheikh is gifting you about 100K EUR per year

Well, if you never declare it (as you are not obliged to) and it lands into a non-CRS reportable bank account, then possibly no one will have to know about it to question it.