11. july 2019
**The Entrepreneur Account, launched through the cooperation of LHV Pank and the Tax and Customers Board, has gained more than 1000 customers within 6 months. The Entrepreneur Account simplifies the payment of taxes and reporting of private persons engaged in entrepreneurship. **
As at today, there are 1005 active Entrepreneur Accounts at LHV Pank. LHV started to offer its customers the possibility of using an Entrepreneur Account in January. As this was a completely new service enabled by the law to private persons engaged in micro-enterprise, it was difficult to estimate the future popularity of the service. “We are satisfied that in half a year we have already reached 1000 Entrepreneur Accounts. This shows that there is a demand for this,” said Kadri Kiisel, head of Retail Banking at LHV. “There have been lots of prospects and we have received invitations throughout Estonia to come and introduce the Entrepreneur Account to people. We have every interest in making entrepreneurship as easy, carefree and unbureaucratic as possible for people,” Kiisel added.
The statistics of LHV show that 56% of the users of the Entrepreneur Account are men, and 44% women. The oldest user of the Entrepreneur Account is 81 years old, the youngest 11, and the average user 40 years old.
Out of the users of the Entrepreneur Account, 51% live in Harju County (39% in Tallinn), 22% in Southern Estonia, 10% in Western Estonia, 9% in Eastern Estonia, 8% in Central Estonia. One Entrepreneur Account user, however, lives in France.
The Entrepreneur Account is a favourable and unbureaucratic form for engaging in entrepreneurship that simplifies the fulfilment of business-related obligations of private persons. When using the Entrepreneur Account, there is no need to submit financial statements, and monthly tax returns are submitted and taxes paid automatically. When using the Entrepreneur Account, the tax rate is 20% of the amount received in the Entrepreneur Account. If the annual income exceeds 25,000 €, the amount exceeding it will be subject to a 40% tax rate. If the sum received in the Entrepreneur Account exceeds 40,000 € in a calendar year, it will not be possible to use the Entrepreneur Account.
Entrepreneur Account is most useful for persons, who sell their time to other private persons, i.e. provide services or sell products, for which there is no need to make big expenditures in advance or the costs of which are paid by the person ordering the service. Entrepreneur Account is not suitable for commodity brokers or when the input cost comprises a large part of the sales price.
Generally, the Entrepreneur Account can be used similarly to a regular current account, however we recommend using another current account for daily operations that are not related to the Entrepreneur Account, to avoid erroneous tax payments to the Tax and Customs Board. Further information: https://www.emta.ee/eng/private-client/declaration-income/entrepreneur-account-natural-person
In June, the Entrepreneur Account developed by LHV and the Tax and Customs Board received the innovation award of the Banking Association.All news