Company In Estonia, Residence in Portugal

[Bibo]

Hi all, I am new here 🙂

I am working online as advertising expert and business strategist. I basically can work anywhere. I would love to relocate in Portugal and I was thinking to open an Estonian company since I know the beaureocracy is very limited and profits are not taxed unless distributed.
I also heard about non habitual resident program in Portugal which should allow me not to pay any taxes for 10 years. Does anyone know which would be the best way to pay myself? Dividends or Salary? and how to avoid any problems with my current country ( IT)

Thanks in advance to anyone who can give me some useful tips 🙂

Bibo

 

[Marc Jacob]

If you are tax exempted, you won't have to pay taxes on your salaries, but i higly doubt that this is even possible within the EU, cause to wave social taxes in Estonia, you will have to provide an A1 form - meaning that social taxes are paid in Portugal (So taxes have to be paid somewhere). You can consult the official page of the european union for further info : https://europa.eu/youreurope/citizens/work/social-security-forms/contact_points_pd_a1.pdf.

 

[Bibo]

Marc Jacob said:
If you are tax exempted, you won't have to pay taxes on your salaries, but i higly doubt that this is even possible within the EU, cause to wave social taxes in Estonia, you will have to provide an A1 form - meaning that social taxes are paid in Portugal (So taxes have to be paid somewhere). You can consult the official page of the european union for further info : https://europa.eu/youreurope/citizens/work/social-security-forms/contact_points_pd_a1.pdf.
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thanks for your answer. Anyone who can clarify this point ? because I heard different opinions on the subject

 

[Marc Jacob]

Just a quick search : https://www.livinginportugal.com/en/moving-to-portugal/tax-regime-for-non-habitual-residents/ - In short, with the A1 form from Portugal, you will be taxed at a rate of 20%, what is much better than you would you pay in mostly west EU countries. Plus, be warned on the fact that without residency and business connections in Estonia, you won't get a bank account in LHV, swedbank or any deposit banks except EMIs.

 

[mikestachurski]

Bibo said:
Hi all, I am new here 🙂

I am working online as advertising expert and business strategist. I basically can work anywhere. I would love to relocate in Portugal and I was thinking to open an Estonian company since I know the beaureocracy is very limited and profits are not taxed unless distributed.
I also heard about non habitual resident program in Portugal which should allow me not to pay any taxes for 10 years. Does anyone know which would be the best way to pay myself? Dividends or Salary? and how to avoid any problems with my current country ( IT)

Thanks in advance to anyone who can give me some useful tips 🙂

Bibo
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Bibo did you at the end follow your plan and move to Portugal and set up your business in Estonia. If yes how does it work in practice I mean taxes

 

[JohnLocke]

mikestachurski said:
Bibo did you at the end follow your plan and move to Portugal and set up your business in Estonia. If yes how does it work in practice I mean taxes
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It's an old thread but still interesting and your question is valid, I'm curious too 😉

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[Don]

Admin said:
It's an old thread but still interesting and your question is valid, I'm curious too 😉
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mikestachurski said:
Bibo did you at the end follow your plan and move to Portugal and set up your business in Estonia. If yes how does it work in practice I mean taxes
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If you know anything about taxes, then you should realize that the total tax % depends on a lot of factors, but...
A possible solution is to set up a nominee structure that would allow you to run your business tax-free (meaning no corporate tax until you distribute income), and when you need to withdraw funds from your company we can provide locally compliant payroll services through separate entities in most countries of the world (except very high-risk ones) for from around ~400 EUR per one month or payment if its one-time contract. This way you would not have any direct links to your company in terms of management, which would help to mitigate the potential permanent establishment risks you might have other ways, at least on paper. Note that local payroll taxes would apply then if applicable.

 

[jerseyuser]

What is your citizenship ? Beware the profits in Estonia still be tax by your home country

 

[mikestachurski]

jerseyuser said:
What is your citizenship ? Beware the profits in Estonia still be tax by your home country
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My Citizenship is Polish and British. Why my profits would be taxed in Portugal? If I don't withdraw them from the company and company is based in Estonia this is where it is taxed. If I withdraw income me (as I am based in Portugal) would be taxed there this is how it works (I think)

 

[jerseyuser]

mikestachurski said:
My Citizenship is Polish and British. Why my profits would be taxed in Portugal? If I don't withdraw them from the company and company is based in Estonia this is where it is taxed. If I withdraw income me (as I am based in Portugal) would be taxed there this is how it works (I think)
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this approach is great. How about take out the profit in Estonia in form of salary ? Also, could you share some experience on Estonia banking. I am interested to set up a ltd in Estonia, my main customers are from UK and US.

 

[Don]

jerseyuser said:
this approach is great. How about take out the profit in Estonia in form of salary ? Also, could you share some experience with Estonia banking? I am interested to set up an ltd in Estonia, my main customers are from UK and US.
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It's possible to open accounts with electronic money institutes remotely. For local banks you need to go to Estonia in most cases.

 

[ska]

So it a good idea to be phisically in Portugal and have an Estonia LTD (OU) without receiving any salary/dividends?

 

[Marzio]

skidrowking said:
So it a good idea to be phisically in Portugal and have an Estonia LTD (OU) without receiving any salary/dividends?
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Yes if you don't manage the company from Portugal otherwise you are creating a PE in Portugal

 

[ska]

No I will stay more than 183 days in Portugal... So will they discover me if I don't get any salary/dividends during those 10 years?