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Company Formation Estonia



Sole Proprietorship in Estonia

Updated on Monday 08th January 2018

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Sole_Proprietorship_in_Estonia.jpgA sole proprietor in Estonia

A sole proprietor in Estonia is essentially a one man business, a business owned and run by an individual who bears full responsibility for the business and is liable with all of his or her assets. This type of company is preferred by foreign investors who want to work on their own, who plan to run small scale businesses, like engaging in consulting services, or who want to keep their business at a family level.
There are certain advantages that make this business form attractive for business people in Estonia, but investors should consider each and every one of them carefully before making any business decision. Our Estonian company formation experts can help you know everything about the sole proprietorship in Estonia, the liabilities that come after engaging in such a business activity and all about the registration and taxation procedure.

Establishing a sole proprietor in Estonia

A sole proprietor is a natural person that engages in economic and business activities. For this purpose, the sole proprietor (individual) must be registered at the Estonian Commercial Register before engaging in any business activities. Any individual who is interested in establishing a sole proprietorship in Estonia must begin by filing an application. The registration application is submitted at the Commercial Register or with the help of an Estonian notary. 
If the language is an issue, our experienced Estonian company incorporation agents can help you make the necessary arrangements. A sole proprietor does not require any complex business incorporation documents, such as the Articles of Association. One condition for establishing a sole proprietorship in Estonia is that the person or persons involved in the business activity have a registered place of residence in Estonia. Another step that needs to be accomplished is to open a bank account for the sole proprietor
Usually, the name of the sole proprietorship will include the name and the surname of the business owner. Other names can be selected, however, in this case you might need to observe the existing trademark legislation in Estonia. 

The advantages of a sole proprietor in Estonia

One of the main advantages that make this business form suitable for entrepreneurs is that the business activities can commence in a very short amount of time. Another advantage that might be important to some foreign investors is given by the lower incorporation costs, when compared to other existing business forms in Estonia. The costs generally include registration fees and notary fees. In terms of annual taxation, the sole proprietorship has another advantage: it does not have to be registered as a VAT payer unless the annual turnover exceeds a certain amount.
The sole proprietor will have to observe the current legislation for personal income tax and will have to comply with the employment law if he or she desired to hire any other employees.
Please contact our Estonian company incorporation consultants if you want to know more about the sole proprietorship and about doing business in Estonia. 


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