Estonia taxing undistributed profits in 2026 where people will go to now?

[Nw1]

Some winding up their Estonian company, these days have been researching possible offshore online formation possible corporate entites to leverage foreign income tax waiver which have access to local card processors that allow cross border transactions and charge on per sale commission basis without setup/annual fees by payment gateway. Or ideally have access to Paypal recieving, stripe, wise business, etc. With no WHT on undistributed profits. Able to setup company 1 director, 1 shareholder 100% foreign owned no quarterly bs docs submissions/advance tax payments only year end submissions. Without need for resident local agents. Able to collect payments from US clients tax free via waiver of foreign income. Low penalties for any delays of doc submissions. Low incorporation costs and annual renewal costs. And this all fit bill for Estonian but sadly new 2% tax coming in 2026 so what other option exists which others who already have Estonian company going to apply which I could do same?

Some did mention US LLC but since it is tax transparent and it comes onto personal tax liability not an ideal solution since not living in a tax free country. And the idea is to setup a corporation so the corporation hangs onto the money and not distribute as salary or dividends. Plus US have quite high penalties for doc delays and other related things and lots of legal implications if ties to US when consider reporting to other non US financial institutions

 

[daniels27]

Haven't we discussed this already in many details here
https://www.offshorecorptalk.com/th...stinations-to-utilize-non-dom-benefits.46922/
https://www.offshorecorptalk.com/threads/0-tax-offshore-company.46506/

You either need to use a US LLC or add a company in front of it. Or you go with Hong Kong or Singapore. All is possible, but costs money depending on your banking needs. For your setup, Hong Kong, Singapore, Guernsey are the usualy suspects. But they all require proper accounting.

If you do not want accounting, you will need to go the US LLC way.

 

[Nw1]

This topic is to find out what other options who made Estonian companies now will do to basically get the same result I am after. Estonia literally fits the bill of what I want as well if it weren't for the 2% coming in future

 

[daniels27]

This topic is to find out what other options who made Estonian companies now will do to basically get the same result I am after. Estonia literally fits the bill of what I want as well if it weren't for the 2% coming in future

Estonia had accounting and even audits above certain revenue. If this is acceptable, Hong Kong, Singapore, Gibraltar, Isle of Man, Jersey, Guernsey.

 

[Nw1]

Estonia had accounting and even audits above certain revenue. If this is acceptable, Hong Kong, Singapore, Gibraltar, Isle of Man, Jersey, Guernsey.

Accounting and even audit is acceptable as long as no advance income tax payments and quarterly tax doc prep work and submissions

 

[Nw1]

HK and Singapore quite high maintenance and setup costs usually
What about costs in these options:
Gibraltar, Isle of Man, Jersey, Guernsey.

Also any local banks allow non resident online company bank account opening?
And what are local payment gateway that allow cross border transactions which are having no annual/setup fee per sale commission basis?

And does these have PayPal receiving and stripe and wise business?

And foreign income waiver have right?

And no need resident local agent? Can form 1 Director 1 Shareholder 100% foreign owned?

 

[daniels27]

The costs in those countries are above $4000 per year. What is your annual profit that you are hiding?

 

[alain]

acceptable as long as no advance income tax payments

That's interesting and has never been discussed in the hundred of threads where people go for low to no tax countries. Does Dubai & Estonia request advance payments for tax like they do in some countries ?

 

[Nw1]

The costs in those countries are above $4000 per year. What is your annual profit that you are hiding?

Hiding is not the appropriate term if you are doing accounting and 3rd party audits

4K per year too excecive(higher the cost yearly, higher the country is regulated and lots of red tape) there should be more exotic options well under $150 per year similiar to US LLC which is 60 state annual report cost+ around 70-80 agent cost

 

[daniels27]

Yes, those options exist. But you either won't be able to pull it off for $150 or won't get banking. In any case, we need to know the turnover and profit in order to help out better. And your maximum you are willing to pay per year for the whole show.

 

[Nw1]

That's interesting and has never been discussed in the hundred of threads where people go for low to no tax countries. Does Dubai & Estonia request advance payments for tax like they do in some countries ?

Most countries do and it is very annoying either tax department has to give you a pre calculated bill based on your bank transactions and auto deduct your balance if they want quarterly cash flow and let us request refund if error on their part at year end. Not like the technology doesn't exist to automate this get rid of all the uncessary paper work/calculations corporations expected to do

 

[Nw1]

Yes, those options exist. But you either won't be able to pull it off for $150 or won't get banking. In any case, we need to know the turnover and profit in order to help out better. And your maximum you are willing to pay per year for the whole show.

10K to 2Mn revenue, profit will vary lot since it is diversified if revenue makes stuff expensive then can simply break it into 10K piecies and incorporate all seperately as new entities

 

[daniels27]

Ok and what is your real annual budget for the company?

 

[daniels27]

Most countries do and it is very annoying either tax department has to give you a pre calculated bill based on your bank transactions and auto deduct your balance if they want quarterly cash flow and let us request refund if error on their part at year end. Not like the technology doesn't exist to automate this get rid of all the uncessary paper work/calculations corporations expected to do

Which countries are those?

 

[JustAnotherNomad]

not an ideal solution since not living in a tax free country

You are aware that your "Estonian" company has to pay tax where you live, right? You can't just live in e.g. Spain, incorporate in Estonia and only pay tax on the money you pay out to yourself. You know that, right?

 

[daniels27]

You are aware that your "Estonian" company has to pay tax where you live, right? You can't just live in e.g. Spain, incorporate in Estonia and only pay tax on the money you pay out to yourself. You know that, right?

Yes, he knows that. But he is from India or some other strange place where the government scans bank accounts real time but is too poor to chase him.

N

Post in thread 'Cheapest online offshore company formation destinations to utilize non dom benefits'

Friday at 14:54

Yes, not a good idea. But where are you resident? Unless you are in Monaco or travelling etc. you would need a company with substance in order to avoid your traxes back home.

Not living in a tax free country like Monaco but it is not one of the big 5 and the country lacks sufficient man power/tracking capabilities to come after if the entites made are totally seperate to each other. Unless like it is making 200-1000Mn revenue then they will come after finding to claim their cut
Thing is I don't take money out from the new company as dividends/salary etc so I anyway wouldn't have a...

• Nw1

 

[daniels27]

In any case, the whole stuff starts smelling a bit too much. Revenue of 10k to 2m and looking for some 150 USD setup.

 

[Nw1]

You are aware that your "Estonian" company has to pay tax where you live, right? You can't just live in e.g. Spain, incorporate in Estonia and only pay tax on the money you pay out to yourself. You know that, right?

Please read the initial post no money from the company comes back to me

 

[daniels27]

Please read the initial post no money from the company comes back to me

No, he is right. Your company gets taxed where it has a PE and that is your home in this case. The only way around this, is having a director elsewhere that manages the company.

If you do not care about this, then use a US LLC and you will be hapy.

 

[daniels27]

That's interesting and has never been discussed in the hundred of threads where people go for low to no tax countries. Does Dubai & Estonia request advance payments for tax like they do in some countries ?

Why has it never been discussed? Because it is irrelevant. Most of th time people go to such countries, it is because they do not pay any tax. And those that stay are fine with paying taxes and accept that some countries ask for tax payment a bit earlier than just two years after they pocketet the money.