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Holding company in Estonia

Updated on Wednesday 24th June 2015

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A holding company in Estonia is a group of several businesses under the same umbrella and this structure is motivated by a number of advantages received by the contractor.

 

An Estonian holding company retains its identity and form of organization, as well as its place on the supply and sales markets. The connections between the main company (parent company) and subsidiaries is made in the financial, technology and investment sectors. In Estonia, a holding company establishes the directives for the companies under its control in the financial, management and marketing of products.

 

By creating a holding company in Estonia the founders facilitate the acquisition of smaller companies and even larger enterprises in the sphere of control.

 

How can be created a holding company in Estonia

The Estonian law provides that a holding company can be established here only when it is registered or incorporated in Estonia. An Estonian holding company can be shaped in two business forms, as a private limited company (OU) or as a public company (AS).

 

The minimum share capital that must be deposited in order to open a holding company in Estonia is EUR 25,000 when it takes the form of an OU or EUR 2,500 when it is registered as an AS. The founders must be aware that these amounts must be paid in full before registration.

 

Which are the fiscal advantages of a holding company in Estonia

The fiscal advantages of a holding company in Estonia are: the existence of a favorable tax regime, particularly the taxation of dividends received and /or paid, possibility of implementation of European directives on the taxation of payments of dividends, interest and royalties between related companies established in the EU. By a holding company in Estonia there also exists the possibility of applying the avoidance of double taxation, under which the tax rates on dividends, interest and royalties may be lower than those provided by law. Moreover, resident companies and permanent establishments registered in Estonia are not taxed on their income. These entities are only charged with the corporate distribution tax.

 

Which are the non - fiscal advantages of a holding company in Estonia

The creation of a holding company in Estonia also offers non-fiscal advantages, for example the possibility of paying dividends during the year and also financial market stability. Among other advantages there can also be considered the potential advantages in terms of the foreign exchange regime and the confidentiality regarding the identity of shareholders. A holding company in Estonia also has easier access to financing and listing on mature financial markets and is more stable and predictable.

 

Contact our company formation specialists Estonia for further information about the holding companies in Estonia.

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