Why choose Luxembourg for holding companies?

Luxembourg excels for holding companies due to participation exemption regime (no tax on qualifying dividends and capital gains), extensive double tax treaty network (90+ countries), no withholding tax on EU dividends, and sophisticated legal framework specifically designed for holding structures.

What are the main company types in Luxembourg?

SARL (private limited company) requires €12,000 minimum capital and is suitable for most SMEs. SA (public limited company) requires €30,000 minimum capital and offers more flexibility for larger operations and fundraising. Both offer limited liability and can be 100% foreign-owned.

What are Luxembourg's corporate tax rates?

Luxembourg has a standard corporate income tax rate of 24.94% (including municipal business tax). However, the effective rate can be significantly reduced through various tax optimization strategies, IP regimes, and participation exemptions for qualifying structures.

Do I need substance in Luxembourg?

Yes, Luxembourg requires adequate substance for companies to benefit from tax treaties and avoid being considered shell companies. This typically includes local directors, office space, employees, and real decision-making in Luxembourg. Requirements vary based on business activities and structure.

Luxembourg Company Registration | EU Financial Hub

Company Registration

SARL (Société à Responsabilité Limitée)

Share capital minimum €12,000 (not included in price)

Limited liability protection
Minimum 1 shareholder (max 100)
Minimum 1 manager
Flexible structure

SA (Société Anonyme)

Share capital minimum €30,000 (not included in price)

Limited liability
Minimum 1 shareholder
Board of directors required
Can be publicly traded

SOPARFI (Holding Company)

Share capital minimum €12,000 (not included in price)

Participation exemption regime
No withholding tax on dividends
Capital gains exemption
Flexible for structuring

Why Register in Luxembourg?

Political & Economic Stability

AAA credit rating with stable pro-business government.

Financial Hub

Europe's leading investment fund domicile and banking center.

Tax Efficiency

Favorable holding company regime and IP tax benefits.

Multilingual Workforce

French, German, and English widely spoken.

Corporate Tax Rate

24.94% (17% + municipal tax)

VAT Rate

17% (standard)

Minimum Capital

€12,000 for SARL

Incorporation Timeline

4-6 weeks

Manager Requirements

1 minimum, any nationality

Credit Rating

AAA (Moody's, S&P, Fitch)

Company Registration Services

1

Name Reservation

Reserve company name with Trade Register

1-2 days

2

Draft Statutes

Prepare articles of association

1 week

3

Notarization

Notarial deed of incorporation

1-2 days

4

Bank Account

Open corporate account and deposit capital

2-3 weeks

5

Trade Register

Registration with Luxembourg Trade Register

1-2 weeks

6

Tax Registration

Register with tax authorities

1 week

Frequently Asked Questions

What are the minimum requirements to establish a Luxembourg company?

For a SARL (most common), you need minimum share capital of €12,000 (at least €6,000 paid upon incorporation), at least one shareholder (individual or corporate), and one manager (director). No residency requirement for shareholders or managers. A registered office address in Luxembourg is mandatory, along with a Luxembourg bank account.

How long does it take to incorporate a company in Luxembourg?

The entire process typically takes 4-6 weeks. This includes name reservation (1-2 days), drafting articles of association (1 week), notarization (1-2 days), bank account opening and capital deposit (2-3 weeks), Trade Register registration (1-2 weeks), and tax registration (1 week). Timeline can vary based on bank requirements and documentation completeness.

What is a SOPARFI and when should I use it?

A SOPARFI (Société de Participations Financières) is a Luxembourg holding company that benefits from the participation exemption regime. It's ideal for international holding structures, as it offers 0% tax on qualifying dividends and capital gains, no withholding tax on outbound dividends (under conditions), and access to Luxembourg's extensive tax treaty network. Perfect for corporate groups and investment structures.

What are Luxembourg's substance requirements?

Luxembourg requires real economic substance for tax benefits. Companies must have adequate physical presence (office space), qualified management making strategic decisions in Luxembourg, appropriate number of qualified employees, adequate operating expenditure, and conduct core income-generating activities locally. The level of substance required depends on the company's activities and risk profile.

Can foreigners own and manage Luxembourg companies?

Yes, there are no restrictions on foreign ownership or management. Shareholders and managers can be of any nationality and don't need to be Luxembourg residents. However, having local management and substance is important for demonstrating genuine economic presence, especially for companies seeking to benefit from tax treaty provisions.

What are the annual compliance obligations in Luxembourg?

Annual requirements include: preparing and filing annual accounts with Trade Register within 7 months of year-end; holding annual general meeting within 6 months of year-end; filing corporate income tax return; filing annual confirmation statement; maintaining statutory registers; and complying with AML/KYC requirements. Companies exceeding certain thresholds must have accounts audited by an approved statutory auditor.

How does Luxembourg banking work for companies?

Luxembourg offers world-class corporate banking services through over 130 international banks. Opening an account requires standard KYC documentation, proof of business activities, and source of funds verification. The process typically takes 2-3 weeks. Banks offer multi-currency accounts, sophisticated treasury services, and expertise in international transactions. Banking relationships are professional but banks conduct thorough due diligence.

Is Luxembourg suitable for investment funds?

Absolutely. Luxembourg is the world's second-largest investment fund center with over €5 trillion in assets under management. It offers specialized fund structures including UCITS, SIFs, SICARs, and RAIFs, with tax-transparent treatment, sophisticated service provider ecosystem, strong regulatory framework (CSSF), and access to EU fund distribution passport. Ideal for asset managers seeking a respected European domicile.

Company Formation Configurator

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Price Summary - Luxembourg

Guide price

Average engagement cost

€16,500.00

Base Formation Fee-€440.00

Virtual Office (Annual)€440.00

Total€0.00

Final price may vary based on specific requirements

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🇱🇺 Luxembourg Company Registration