Estonia is currently one of the most entrepreneur-friendly countries in Europe. Its tax system is transparent, and taxes are relatively low.
Taxes in Estonia
There are two options for paying corporate income tax in Estonia. The first one, which is familiar to Polish taxpayers is the well-known Estonian CIT. It consists in exempting companies from tax obligation until profits or dividends are distributed from the business. A CIT tax of 20% is charged only when the company chooses to distribute the profits or dividends. The other variant is continuous taxation of corporate income with a 14% CIT. This type of taxation is dedicated to companies which frequently distribute profits or dividends. Estonia does not impose any local income taxes. The standard VAT rate is 20%. Companies are considered Estonian residents if they are established under Estonian law. There is no need for a management and control test to determine its tax residence.
Estonian taxes – note the following:
Polish tax authorities are sensitive to simulated changes of residency due to Estonia’s low taxes. Estonia is a country where it is worth opening or moving a business to, but it is important to remember that these actions should be real.
Moving abroad is a highly significant step in life. Tax issues should come as the last matter to be considered. Think about where you would like to live, where your children should go to school and where you want to run a business. Only after honestly answering these questions, can you decide which country will be the most suitable for all your needs.
WHAT FORMALITIES DO I HAVE TO COMPLETE WHEN MOVING OUT OF POLAND?
There are many formalities, and they depend primarily on the current situation. The aim should be to completely sever all ties with Poland.
DO I HAVE TO FILE A TAX RETURN IN POLAND AFTER MOVING AWAY?
Tax returns in Poland are submitted by Polish residents or persons earning income in Poland who are residents of another country. It all depends on whether you have successfully relinquished your Polish residence. And if you have, it also depends on the kind of income you earn in Poland.
WILL I PAY TAX IN POLAND BECAUSE OF RELOCATING THE COMPANY ABROAD?
The question is about the broad subject of exit tax. First of all, you need to verify what moving the company abroad actually means. It can be both the relocation of the registered office of the company and the personal move of the entrepreneur – a natural person. The tax implications of both situations may be significantly different.
CAN I TRANSFER THE COMPANY'S ASSETS TO THE DESTINATION COUNTRY TAX-FREE?
The general limit below which you do not have to pay exit tax in Poland is PLN 4 million. Nevertheless, it is always necessary to check this issue because the transfer of the company’s assets to the destination country will not always mean the same thing.
This website uses so-called „Cookies”. Further use of the website without changing your cookie settings, means consent to their recording or use. Detailed information can be found in the Regulations tab.