Understanding Permanent Establishment (PE): Key Insights for Spanish Entrepreneurs

For Spanish entrepreneurs considering e-Residency to launch their businesses in Estonia, understanding the concept of permanent establishment (PE) is essential. Permanent establishment (PE) determines the particular country in which your company is subject to taxation and can shape how your business operates across borders. The critical question is whether your company’s value is primarily created in Spain or if its business substance will be predominantly located in Estonia. This distinction plays a crucial role in determining your tax obligations and business strategy.