Hacker News new | ask | show | jobs
by ma2kx 38 days ago
I would say that depends of the company's legal form. If you have an "AG" or "GmbH" you get double taxed anyway, one time the company and than again your salary. So if you have an Estonian equevilant of a GmbH/AG your company will get taxed by Estonia and your salary by Germany. The Estonian E-Residency Website at least confirms my assumption but in case of Germany I could be very well wrong of course...

https://www.e-resident.gov.ee/understanding-cross-border-tax...
3 comments
b3orn 38 days ago
You don't get double taxed, you get taxed on your salary and your company gets taxed on whatever profit remains after paying salaries.
link
ExpertAdvisor01 38 days ago
I think you misunderstood double taxation . You probably understood it as taxation on corporate and personal level. But in this context it means taxation in two jurisdiction (Estonia,Germany)
link
notpushkin 38 days ago
> So if you have an Estonian equevilant of a GmbH/AG your company will get taxed by Estonia and your salary by Germany

Estonian CIT is 0%. If you pay dividends (which is not required), or if you pay director’s salary (optional if you’re a one-man company without a ton of admin), those will be taxed in Estonia. If you only pay yourself for your actual services – no taxes in Estonia.

Germany might tax your Estonian company if they determine the company is a German resident. Check with your accountant.

(IANAL)

link
ExpertAdvisor01 37 days ago
Estonia isn't 0% cit . Tax is just deferred until distribution.
link
notpushkin 36 days ago
Technically yeah. But you don’t have to distribute profits, and paying yourself for your (non-admin) services is not taxed in Estonia.

You might have to pay yourself a director’s salary. That would indeed be taxed at 22%, but you still only have to bill for the time you actually do admin / management work. So if you spend, say, 5 days a month on it and 15 days a month on everything else, the effective rate would work out to 5,5%.

And for a single shareholder company with no employees and under 2M € annual revenue (and probably some other criteria like not having employees or veing liable for VAT or something) it is the general practice to just not pay the director’s salary at all.

(This is probably a gross oversimplification, definitely ask a real accountant about the details.)

link