Estonia vs Lithuania: Company Formation Compared

Estonia vs Lithuania side by side

Compare the legal form and your operating plan before choosing a country. The table draws from the linked country profiles. Short tax and capital labels describe the main company form, not every possible structure. Timelines are indicative and depend on documents, signing eligibility, capital payment and any account checks.

Which is right for you

Consider Estonia for online OÜ administration, subject to digital-signature and address requirements. It still needs a capital contribution per shareholder: a small statutory amount is not the same as no minimum capital or no running costs.

Consider Lithuania when its company forms and local operating environment fit your business. Compare capital and annual costs for the chosen form; access to a bank or payment account depends on the provider, activity, owners and their residence.

Still weighing it up? Compare them against the rest in company formation in Europe, or see the overall best country ranking.

Official fees, capital and ongoing costs

A low capital requirement does not mean free formation. Compare the official filing route, any notarisation, identity-card costs, professional services and annual administration separately. Capital belongs to the company; it is not an official fee. For budget assumptions, see first-year and annual company costs.

Estonia: capital and formation budget

The minimum share capital is EUR 0.01 per shareholder. Founders must pay their contributions before submitting the registration application, and the board confirms payment. Capital funds the company; it is not a registration fee. A small contribution does not remove company or director obligations.

Online OÜ registration costs EUR 265. An e-Residency application, if needed, costs EUR 150; the card is valid for five years with no annual card fee. The official programme gives indicative contact-person costs of EUR 200 to 400 a year and accounting from EUR 50 a month. These are not provider quotes. Check VAT, address services, annual-report preparation and other extras before choosing a package. Budget share capital separately.

Lithuania: capital and formation budget

EUR 1,000 for a UAB (reduced from EUR 2,500 in May 2023), with at least 25% paid before registration. The MB form has no minimum capital.

Registry and notary costs are modest, usually well under EUR 300 all in, on top of the EUR 1,000 share capital, which becomes working capital once the company is live. A registered address costs around EUR 100 to 300 a year if you rent one. Accounting for a small UAB typically runs EUR 80 to 200 a month.

Digital signing, directors and address arrangements

Remote formation is a route with conditions. Check who must sign, which identity documents are supported and who will receive official mail. Share ownership, company management and permission to live or work in a country are separate questions.

Estonia: formation conditions

A standard OÜ can be registered online once all founders and board members, and the contact person provider when appointed, can sign with a supported Estonian digital ID. If you need an e-Residency card, apply personally and collect it in person at an official pickup location first. An intermediary cannot submit that personal application for you. Company registration does not guarantee an account or remove obligations in the country where you work or manage the company.

About one business day for the registry to review a complete online application once all required signatures and payments are ready. If you need an e-Residency card first, the latest official application guide says most applicants collect it within two to four months. Review generally takes 30 calendar days, then delivery to the pickup location takes two to five weeks after approval. Collection must be in person; these are estimates, not deadlines.

No residency or nationality requirement for directors or shareholders. The company can use an Estonian legal address or the foreign address of its management board. Using the foreign address requires a licensed contact person to receive official mail. The contact person cannot act for the company; renew the appointment before it expires.

Lithuania: formation conditions

Yes. A UAB can be incorporated remotely with a qualified electronic signature or by power of attorney; 100% foreign ownership is allowed.

About 3 to 5 business days, and as little as 1 to 3 days when founders use a qualified electronic signature.

No residency requirement for directors or shareholders; a foreign national can be sole director and shareholder.

Banking eligibility and recurring obligations

Choose a realistic account route and an accounting plan before incorporation. An approved company application does not guarantee a bank or payment account. Check the provider's contracting entity, safeguards and support for your activity and residence; see business accounts for non-resident founders.

Estonia: accounts and compliance

Compare bank and payment accounts that support Estonian OÜ companies and your country of residence. Check business-activity eligibility, ownership documents, the capital-payment route and account protections. e-Residency and company registration do not guarantee account approval.

File an annual report with the e-Business Register within six months of the financial year-end, normally 30 June for a calendar-year company. This also applies when there was no economic activity. Reporting detail and audit requirements depend on the applicable rules and thresholds. Assess VAT and payroll filings separately, and keep required address and contact-person services current.

Lithuania: accounts and compliance

Compare providers by their contracting entity and licence. Revolut Bank UAB is a Lithuanian-licensed bank; Paysera LT UAB is a Lithuanian electronic money institution; Wise Europe SA is a payment institution authorised in Belgium. These categories do not provide identical account protections or services. Check UAB, owner, residence and activity eligibility, and confirm the capital-payment account and evidence with the registry or adviser. Incorporation does not guarantee account approval.

Annual financial statements go to the Register of Legal Entities within a few months of year end after shareholder approval. The corporate income tax return is due by the fifteenth day of the sixth month after year end, and VAT payers file monthly. Small UABs below the size thresholds do not need an audit.

Use the post-registration checklist to plan the work that follows formation. National deadlines and thresholds still apply.

Tax follows the company and its operations

The place of incorporation is one part of the analysis. Where management decisions happen, where employees work and where the business has a taxable presence can create additional obligations. Compare a complete operating plan with an adviser before treating a headline tax figure as your effective rate.

Estonia: tax context

Estonia generally defers corporate income tax on retained business profit. Tax arises on distributions and certain other payments, including taxable fringe benefits, gifts, donations, entertainment and non-business expenses, subject to statutory exemptions. Distributed profit is taxed at 22% (calculated as 22/78 of the net distribution, so a EUR 10,000 dividend carries EUR 2,821 of tax). There is no municipal or local corporate tax. A planned rise to 24% and a temporary 2% profit tax were both cancelled in late 2025, so 2026 stays at 22%.

Standard VAT is 24%, in force since 1 July 2025 (up from 22%) and now permanent. Reduced rates are 13% (accommodation) and 9% (books, press and certain medicines). The VAT registration threshold is EUR 40,000 of domestic turnover per year.

Lithuania: tax context

The standard corporate income tax rate is 17% for the 2026 tax period, following 16% in 2025. Eligible small entities with tax-period revenue not exceeding EUR 300,000 may use 7%, subject to the related-entity restrictions. The former ten-employee condition does not apply from 2026. Eligible newly established entities may use 0% for their first two tax periods, subject to the statutory ownership, revenue and continuity conditions; this is not an automatic exemption for every startup.

Standard VAT is 21%. From 1 January 2026, the reduced rates are 12% and 5% for the supplies specified by law. Check the category and any transitional rule before applying a reduced rate. The VAT registration threshold is around EUR 45,000 of turnover.

Sources and review scope

Formation cost and compliance review dates are scoped checks, not an audit of every tax figure or a guarantee that your application meets every requirement. The profiles retain their country-specific qualifications and sources.

• Estonia: source checks. Formation costs and compliance checked 11 October 2026.

  Online OÜ signing routes, registration fees and e-Residency collection: checked 24 October 2026.

  Corporate tax triggers beyond dividends and legacy dividend withholding: checked 11 October 2026.

• Lithuania: source checks.

  Small-entity corporate tax rate and eligibility changes: checked 11 October 2026.

  New-entity zero-rate periods and conditions: checked 11 October 2026.

  Reduced VAT rates from January 2026: checked 11 October 2026.

  Bank, electronic money and payment-institution distinctions: checked 11 October 2026.

The country profiles use the following official programme, registry, tax-authority and advisory references. Advisory summaries supplement the primary sources and do not replace individual advice.

• e-resident.gov.ee: taxes in estonia
• taxsummaries.pwc.com: taxes on corporate income
• emta.ee: value added tax
• ariregister.rik.ee: start
• abiinfo.rik.ee: establishment private limited company
• learn.e-resident.gov.ee: 360000625118 Costs fees
• learn.e-resident.gov.ee: 360000624858 Contact person legal address
• rik.ee: annual report
• learn.e-resident.gov.ee: 360000633237 How to apply FAQ
• learn.e-resident.gov.ee: 360000624838 5 steps to register a company online
• learn.e-resident.gov.ee: 360000700918 Banking basics
• learn.e-resident.gov.ee: 360000711978 What is e Residency
• emta.ee: tax liabilities companies
• emta.ee: income tax and basic exemption
• taxsummaries.pwc.com: taxes on corporate income
• 1office.co: company formation in lithuania guide
• vmi.lt: 7proc tarifas
• vmi.lt: 5724
• vmi.lt: informacinis prane c5 a1imas d c4 97l e2 80 9eprid c4 97tin c4 97s vert c4 97s mokes c4 8dio c4 afstatymo 19 straipsnio pakeitimo c4 afstatymo
• lb.lt: revolut bank uab
• lb.lt: paysera lt uab
• nbb.be: 4077
• wise.com: how is wise regulated in each country and region