I’m from Croatia, and starting and running a company here is expensive. Estonia makes it much easier, so you might think: why not open a company in Estonia?

But here is a problem: If your clients are in Croatia and you have a Croatian company, you don’t have to charge VAT if you earn under 60k per year. But if your company is in Estonia, you are required to charge VAT even if you earn under 60k.

>But if your company is in Estonia, you are required to charge VAT even if you earn under 60k.

Is this not simply because companies in Estonia enter VAT at 40k per year (rather than 60k)?

(and IIRC Croatia was also at 40k a year ago, now is at 60k with some politicians trying to raise the entry to 100k)

Estonian fiscal law doesn’t apply if your company operates from Croatia. The only reason you can’t do this in practice is because you’ll have a hard time finding a Croatian accountant willing to work with your Estonian company. That’s something EU-inc aims to address.

Even if you incorporate in Estonia it wouldn't change anything . Because the company would still be considered tax resident in Croatia .