The e-residency program enables you to become an “Internet citizen” of a country and enjoy that country’s digital infrastructure.
The first program of this kind was created by Estonia in 2014 and has since convinced 83 000 people to create 17 500 companies in the Baltic country.
The program is tailored for digital nomads and Internet entrepreneurs that do not benefit from cheap or even available company-making infrastructures in their country, or that want an EU company and bank account.
Six other countries have since joined Estonia in offering digital residency.
Here they are.
Liberland is a non-recognized 7 km2 country stuck between Serbia and Croatia.
The territory has been unclaimed since the end of Yugoslavia in 1992.
So in 2015, the libertarian Czech politician Vit Jedlicka claimed the land and established the republic of Liberland, becoming its first president.
Taxes don’t exist and you can trade pretty much anything you want except dangerous stuff like drugs and weapons.
I won’t lie, this whole thing is a little weird.
The country enables you to become an e-resident and you can also apply for citizenship, sold for €45 000.
The road to becoming a Liberland citizen starts on liberland.org.
Then you can apply for an e-resident card before applying for full citizenship.
According to several sources online, you can digitally sign documents and establish a company there, but that seems…hardly possible without proper banking infrastructure, which I doubt Liberland actually has.
If you don’t mind spending €100, you can go test it for yourself here.
The Palau e-residency program was established in February 2022 and is therefore recent.
The e-residency program enables you to become a digital resident which in turn enables you to go through KYC processes or to open a company and bank account (coming soon).
Now, why would you do that?
If you’re afraid of data theft, using a Palau digital ID for KYC enables you not to use your first citizenship.
As for doing business with a Palau company, you should know that Palau imposes a…0% tax on non-Palau income.
That means that you can streamline all of your income to your Palau company and essentially pay no taxes.
You also gain access to the US market thanks to the association treaty Palau has with the US.
Palau is also a crypto-friendly place. Your digital ID exists as a physical card AND enables you to declare your identity on-chain (don’t ask, got no clue how this works).
A digital residency in Palau will cost you $248 for 1 year, $1039 for 5 years, and $2039 for 10 years
You can apply here.
Azerbaijan is a country boarding the Caspian sea. It’s rich in gas and oil, and has one of the widest food scenes in the world.
Its people are friendly and peaceful and all would be perfect if they didn’t fight with the Armenians.
Anyway, Azerbaijan was the second country in the world to establish e-residency in 2018 after Estonia.
They essentially hired a bunch of Estonians and copied the program from top to bottom.
The only difference between the two is that it’s cheaper to access (only €50) and you pay 5% tax instead of 20% in Estonia.
The downside is that almost nothing is written in English. If you don’t speak Russian or Azeri, it might be hard to get it working.
Furthermore, the program has been momentarily put on hold because they have been struggling to find people to take care of it (the email box is full, for example).
I plan on trying out this program when it opens again and will write more about it in the future.
The e-residency program in Lithuania began in January 2021.
Lithuania has been stepping up its digital game as it battles Estonia for digital infrastructure supremacy.
For example, the Lithuanians have created the easiest environment to set up a fintech in, and they’re now developing a rival e-residency program.
Unfortunately, the program is only in its infancy as we speak. All you can do with it is…sign documents, which means not much.
The program will move towards the facilitation of opening a bank account and company in Lithuania.
It’s not yet clear how much taxes you’ll have to pay.
Portugal has been planning an e-residency program for a few years now but it’s still not open, and nobody knows when it will be.
There’s no information either about the tax system, but I have read it’ll be more complicated than the current open programs.
Ukraine has been planning an e-residency program for a long time.
It is set to open in April 2023.
The program will enable you to open a bank account and a company in the country and the taxes are set to be fixed at 5% for profits below $212k and 15% for profits above.
By far the biggest advantage of the Ukrainian program is the fact that you won’t need accountants.
The bank will automatically report and pay your taxes for you.
The program will be closed to Russian citizens, and likely North Korean and Iranians too due to international sanctions.
The fee is not yet known.
And finally, Estonia, likely the best and certainly most successful e-residency program, and let’s be honest, the only one you should consider on this list.
It’s the most secure, the easiest to comprehend, everything is in English, and it’s the most advanced in terms of interface and services offered.
The only problem is that it’s not tax efficient.
Most countries have signed up agreements with Estonia that basically render useless the establishment of a company there.
In Belgium for example, I can’t establish my company in Estonia even if I do business outside of Belgium.
I need to hire people in Estonia to justify establishing my company there, or I have to establish it in Belgium.
So the program is mainly relevant for non-EU people that want to do business in €.
Not my case, sadly.
South Africa, Brazil, and Georgia have announced plans to create an e-residency program of their own.
More states should quickly follow after them.
It’s worth highlighting how numerous countries have now engaged in a talent battle.
Be it online, like Estonia, or in real life, like Dubai, notice how the most valuable commodity in the world is people!
As the world population is shrinking, we can only bet that this tendency will grow.
This means that there has never been a better time to be valuable.
Engineers, entrepreneurs, and scientists never had it as easy to move to a new location and get funding for their projects since the invention of passports in 1920.
Great times we’re living in!
For more digital nomad resources, head to auresnotes.com.
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