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  1. FAQ
  2. Salaries and Dividends
  3. Receiving funds when operating in Estonia

How can I receive funds from my company (operating in Estonia)?

Ultimo aggiornamento: October 08, 2024

As a Xolo Leap customer, if you own and run an Estonian company while operating and being a registered tax resident in Estonia, there are 2 main options for receiving funds from your company:

  1. receive salary (i.e. board member's remuneration)

  2. receive dividends


There’s no obligation to pay any salary or take dividends. It’s reasonable to argue that when a business is still in its infancy, the company can’t afford to pay out anything. So you can start operating your company without receiving any salary. Similarly, you don’t have to pay out any dividends even if you could.

If you would like to pay out some dividends, you’ll need to pay an average amount of salary as well, taking into account your actual contribution in corresponding roles in your company. When providing services through a company it’s necessary to bear in mind - a sole shareholder and member of the management board alone provides services and is engaged in triggering the income to the company. As Estonian tax authorities state, this does not mean that whole business income must be taxed with salary taxes. You have to receive average salary in order to be able for passive income (e.g. dividends). Thus, you have to be paid for your active engagement, either the fee of a management board member, wages or other compensation depending on the type of work (such income is subject to payroll taxes). The remaining profit of the company can be paid in the form of dividends (a sole shareholder also has the right for passive proprietary income).

In summary, you have the following combinations available:

  • keep all the money in the company and reinvest to boost your business or

  • receive salary only (no min nor max amount) or

  • receive average salary + dividends

There is no option to receive dividends only.

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