
Step-by-Step Guide to Opening a Sole Proprietorship (FOP) in 2026
Opening a sole proprietorship (FOP) does not start with filling out an application. First, you need to understand exactly what the entrepreneur will be doing, who will be paying for
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Contents
Company registration in Luxembourg is available to foreign entrepreneurs, non-residents and overseas legal entities. Local law does not impose a general nationality requirement on company founders. However, the business needs a genuine registered office, a transparent ownership structure, a director, a corporate bank account and an actual economic connection with the country.
Luxembourg is unsuitable for purely formal incorporation without economic substance. Most regular commercial, craft and certain professional activities require a business permit. The company must also confirm its place of business and demonstrate that its management operates in Luxembourg.

SARL remains the most widely used legal form. According to the government portal Guichet.lu, approximately two-thirds of Luxembourg companies operate as an SARL. The right structure depends on the number of shareholders, available capital, plans to attract investors and the intended business activity.
Entrepreneurs usually consider three main options:
An SARL suits small and medium-sized businesses, holding companies and operating structures. An SA is more commonly chosen when the founders intend to attract investors, issue different classes of shares or establish a more complex corporate structure.

An entrepreneur may set up a company in Luxembourg personally or appoint an authorised lawyer. A non-resident must complete full KYC and AML checks, explain the source of funds and present a clear business model.
The basic requirements include:
A formal mailing address alone is not enough. To obtain a business permit, the company must have a fixed place of business, while the responsible manager must genuinely oversee its daily operations.
The document package depends on the bank, notary, ownership structure and founder’s country of origin. Documents issued for a foreign corporate shareholder may require an apostille and translation into French, German or English.
The standard package normally includes:
The notary and bank may also request customer contracts, financial statements of associated companies or the owner’s tax returns. Preparing these records before starting the procedure can prevent delays during compliance checks.
Company formation in Luxembourg includes legal, registration, licensing and banking procedures. Some stages can proceed in parallel.
Anyone planning to open a business in Luxembourg should allow time for more than the commercial register entry. The competent authority usually processes a complete business permit application within three months. Bank compliance checks follow a separate schedule.
The country’s official commercial register is the Registre de Commerce et des Sociétés – RCS. Online searches may also describe it as the trade register or corporate register. The functions handled by a single company registrar in some jurisdictions are divided in Luxembourg between the notary, RCS and other public authorities.
The Luxembourg Business Registers administer the RCS. The register stores information about company names, addresses, capital, directors, constitutional documents and annual accounts. These business registers allow interested parties to search for a legal entity by its name or registration number.
Companies must submit information about their ultimate beneficial owners to the RBE within one month after the reporting obligation arises or the relevant details change. Failure to file or the submission of inaccurate information may lead to a fine ranging from EUR 1,250 to EUR 1,250,000.
The basic corporate income tax rate is 14% for taxable income of up to EUR 175,000. A 16% rate applies to income above EUR 200,000, while a transitional calculation covers profits between these thresholds. Companies also pay a 7% employment fund surcharge on the corporate tax amount and municipal business tax.
In Luxembourg City, the combined rate for a company earning more than EUR 200,000 reaches 23.87%. It consists of 16% corporate income tax, a 1.12% employment fund surcharge and 6.75% municipal business tax. The standard VAT rate is 17%. Small businesses with annual turnover of up to EUR 50,000 may qualify for the VAT exemption scheme, although cross-border transactions may trigger registration obligations at an earlier stage.
There is no single fixed price. The cost of setting up a company in Luxembourg may include notarial fees, government charges, a registered office, translations, apostilles, preparation of the articles of association, accounting support and licensing. Share capital should not be treated as a professional fee because the company may use it for business operations after incorporation.
An alternative is to buy a ready-made company in Luxembourg. Before completing the acquisition, the buyer should review its accounts, tax liabilities, banking history, contracts and beneficial ownership records. Nominee services do not remove the obligation to disclose the actual beneficial owner or comply with AML rules.
Receiving an RCS extract is not enough to keep a Luxembourg company compliant. The legal entity must maintain accounting records, submit tax returns, update information in the corporate register and retain evidence of effective management.
Shareholders approve the annual accounts within six months after the end of the financial year. The company then files them with the RCS during the following month. The usual deadline is seven months after the end of the financial year.
Poshuk.info allows clients to browse specialists in the European company registration category and submit one consultation request. Verified law firms and legal service providers that meet the professional criteria for this category will receive it.
There is no need to call every firm separately. Several providers can propose their fees, timeframes and scope of support, including assistance with the RCS, business permit, corporate account and accounting. You can compare the consultations and select suitable terms. A practical route to the EU market is also described in this case study on registering a European company for an IT start-up.
Do you have any questions about registering a company in the Luxembourg? Get all the answers by creating a request:
* by submitting a request on the Poshuk.info website, all verified legal and advocacy companies that meet the professional criteria of this category of services will receive it, so you can get maximum information from various professional sources and choose the best conditions.

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