At the beginning of 2019, LHV Pank and the Estonian Tax and Customs Board introduced a new form of small business, or Entrepreneur Account. Today, there are already more than 10,000 private persons providing services or selling goods through the Entrepreneur Account.
The Entrepreneur Account is a non-bureaucratic and low-cost way for private persons to become entrepreneurs. More than 4,000 private persons have opened an Entrepreneur Account this year, and this week the 10,000 mark was passed. During the year, more than 12.5 million euros were received in the Entrepreneur Accounts, of which 2.5 million euros have been paid in taxes.
According to Annika Goroško, Head of Retail Banking at LHV, they are delighted to see that the right people are finding the Entrepreneur Account, and it is making their business much easier.
‘The Entrepreneur Account was a much anticipated service and it is good to see that the need for it is growing every year. One of the main concerns for small businesses is everything to do with taxes. Whether, how much, when, and to whom is it necessary to pay? The Entrepreneur Account is a solution to all these questions, as there is no accounting obligation when using it, and payments are calculated and all payments are accounted for and taxes are paid automatically. Our ambition is to support entrepreneurial people by providing them with the most convenient ways to run their business and manage their daily finances,’ Goroško says.
According to Annika Oja, Head of Personal Income and Taxation Service at the Estonian Tax and Customs Board, the use of the Entrepreneur Account is also growing and it is linked to the increasing importance of the platform economy in the labour market. ‘It is a convenient, simple, and straightforward way for people to get their tax affairs in order, and we are pleased to see that more and more people are choosing this route every year,’ she says.
‘LHV Pank is a pioneer in the market with an Entrepreneur Account, with great growth potential. In addition, their work in promoting the possibilities of the Entrepreneur Account is also valuable in the eyes of the country, as it is important in promoting tax literacy more widely,’ she adds.
Since the establishment of the Entrepreneur Account at the beginning of 2019, a total of more than 28 million euros has been received in the accounts, of which 5.7 million euros has been paid in taxes.
The Entrepreneur Account is suitable for a person who provides services to other individuals, requiring no large expenditures. For example, babysitters, domestic helpers or private teachers, as well as those engaged in copywriting and marketing usually have virtually non-existent costs. The account is also suitable for those whose sell such goods to individuals or legal persons that are either self-made or with low material and acquisition costs. In recent years, the Entrepreneur Account has also started to spread in the platform economy, for example, among ride-sharing or courier service providers. Only LHV Pank offers the Entrepreneur Account service in Estonia.
LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are LHV Pank, LHV Varahaldus, and LHV Kindlustus. The Group employs more than 820 people. As at August, LHV’s banking services are used by 359,000 clients, the pension funds managed by LHV have 132,000 active clients, and LHV Kindlustus protects a total of 149,000 clients. LHV’s UK branch offers banking infrastructure to 200 international financial services companies, via which LHV’s payment services reach clients around the world.All news