FAQ

Who can open a company in Luxembourg?

Any person be it resident or non – resident of Luxembourg is allowed to open a company in Luxembourg. There are no restrictions regarding the nationality or the place of residence for company founders or shareholders.

What types of companies can be incorporated in Luxembourg?

Foreign investors can incorporate the following types of companies in Luxembourg: SA (Societe anonyme, similar to Public Limited Company), SARL (Societe a responsabilite limitee, similar to Limited Liability Company), SC (Societe co – operative, similar to Partnership Limited by shares), Limited Partnership and SE (Societe europeenne). 

What is the required minimum share capital to incorporate a company in Luxembourg?

The required minimum share capital for a SARL (Limited Liability Company) is 12,400 euros and the number of shareholders is limited to 40. For a SA (Public Limited Company), the required minimum share capital is 31,000 euros. 

Is it required for the company to have an office in Luxembourg?

All types of companies in Luxembourg require a registered main office, used to conduct various business activities in the country.

How to register a company in Luxembourg?

After the articles of association are drafted, the founding members must provide specimen signatures, passport copies and other documents of identification. Once these documents are drafted, they will need to be translated by a certified translator and then submitted to a public notary in Luxembourg for authentication. The articles of association are later published in the Luxembourg Official Gazette. It is also required to open a bank account in Luxembourg to deposit the minimum share capital. The name of the new company must be verified in order to comply with the requirements in the country. This verification is made at the Trade Register.

What do you need to open a bank account in Luxembourg?

In general, the only documents needed to open a bank account with a Luxembourg bank are a valid passport or identity card and a proof of address, such as a utility bill. However, proof of income will be also required. Non – residents will also need to provide a work contract or a letter from their employer in Luxembourg.

Some banks in Luxembourg allow their clients to open an online bank account, but the relevant documents need to be sent by post to the bank. 

Is it possible to open subsidiaries in Luxembourg?

The most common forms of business suitable for a subsidiary in Luxembourg are the SARL (Private Limited Liability Company) and the SA (Public Limited Liability Company). The SARL is suitable for small or medium – sized companies, while the SA is a great option for large corporations expanding their activity in Luxembourg. The subsidiary has certain advantages such as less liability and a higher degree of maneuverability, limited liability for the parent company and legal independence from the foreign company, in order to take its own actions in Luxembourg.

What is a Luxembourg holding company and what are the benefits?

The best option to open a holding company in Luxembourg is a SOPARFI. A SOPARFI is a resident company in Luxembourg that is fully taxable, but has the advantage of participation exemption and may benefit from double tax treaties signed by Luxembourg with a large network of countries. Some of the most important benefits of a Luxembourg company are the following: no withholding tax on dividends paid between the Luxembourg company and other EU resident companies, under certain conditions; no withholding tax on the liquidation process of a holding company; no requirements on paying any subscription tax.

 What are the corporate taxes in Luxembourg?

A corporate income tax rate of 21% is applied to companies that have a taxable income larger than 15,000 euros. Companies who have a lower income are taxed at 20%.  Dividends received by a Luxembourg company are included in the taxable income unless the participation exemption if certain requirements are met. 80% of the income derived from intellectual property rights acquired or created by a Luxembourg company and gains from the disposal of such rights are exempt from income tax. Other corporate taxes include the municipal business tax, the net worth tax of 0.5% and the contribution to the Chamber of Commerce, ranging from 0.025% to 0.2%, at a minimum rate of 140 euros.

What other types of taxes are levied in Luxembourg?

Other types of Luxembourg taxes include the stamp duty and an inheritance and gift tax, ranging from 0% to 48%, under certain conditions.

Is it required to have special permits or licenses for doing business in Luxembourg?

A business license is issued by the Ministry of Middle Classes for a commercial activity or by the Ministry of Economy for industrial activities upon request and on proof of knowledge of business management.

How fast is it to open a company in Luxembourg?

The company incorporation process in Luxembourg takes up to 20 days, depending on the types of documents that need to be prepared. Applying for a business license takes up to 15 days in some cases.

Why should you invest in Luxembourg?

Luxembourg offers many advantages for foreign entrepreneurs and legal entities that invest in the country such as great political and social stability, easy communication with public authorities, a business – friendly regulatory framework, competitive tax environment, excellent infrastructures and incentives for R&D investments.