The letters, portals and forms of an Estonian company are full of official terms. Many of them look complicated at first sight. Below we explain the terms that a business owner meets most often. These are the ones that cause confusion. Each term comes with a short and simple explanation.
Osaühing (OÜ) — the most common form of company in Estonia. Your company is most likely an OÜ as well.
Osakapital — the amount that the owners have put into the company. Since the 2023 reform there is no fixed minimum any more. The law says only that the share capital is expressed in euros.
Netovara — the company's assets with its liabilities taken away. This is a number worth keeping an eye on. If the net assets fall too low, the owners have to do something about it under the law.
Majandusaasta aruanne — an overview of the company's activity and financial position, filed once a year. It has to be filed every year, even if the company was not active. The deadline is six months after the end of the financial year. With a calendar year that means 30 June.
Äriregister and Maksu- ja Tolliamet — two different authorities that are often mixed up. The report is filed with the Commercial Register. Taxes are declared to the Estonian Tax and Customs Board. Separate places, separate deadlines.
When the net assets become too small
If the net assets fall below half of the share capital, you have to act. Commercial Code § 176 lists the possible solutions:
If the net assets of a private limited company are less than one-half of the share capital, the shareholders shall decide on:
1) a reduction or increase of the share capital, on the condition that the net assets would thereby amount to at least one-half of the share capital, or
11) taking other measures as a result of which the net assets of the private limited company would amount to at least one-half of the share capital;
2) the dissolution, merger, division or transformation of the private limited company, or
3) the filing of a bankruptcy petition.
In short: there are several solutions. Most of them do not call for putting in more money. What matters is to act, not to wait. (Source: Commercial Code § 176 — https://www.riigiteataja.ee/akt/104012021046?leiaKehtiv)
What happens if the report is not filed
If the report is not filed by the deadline, the register sends letters in a set order. First comes a warning ruling — a warning with a new deadline, within which everything can still be put right free of charge. After that come the fine-warning ruling and the fine ruling. A penalty payment may come with them. Last of all come the deletion warning and deletion from the register. The register may delete the company once at least three months have passed since the deadline.
Every letter gives you a chance to resolve the situation. The sooner you react, the simpler and cheaper it is.
This article was prepared with the help of artificial intelligence.