Company registration in Luxembourg

Requirements for Founders and Businesses

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.

Choosing the Right Legal Form

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:

• SARL – a private limited liability company with between one and 100 shareholders and minimum share capital of EUR 12,000, which must be fully paid before incorporation;
• SARL-S – a simplified form available only to natural persons, with share capital ranging from EUR 1 to EUR 12,000 and no mandatory notarial deed, although the business permit must be obtained before registration;
• SA – a public limited company with minimum share capital of EUR 30,000, full subscription of the shares and payment of at least 25% of the capital upon incorporation;

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.

Requirements to Set Up a Company in Luxembourg

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 unique company name checked for availability through the RCS;
• a registered office in Luxembourg;
• a clearly defined business purpose without excessively broad wording;
• a founder, director or manager and disclosure of the ultimate beneficial owner;
• share capital that meets the requirements of the chosen legal form;
• a business permit or sector-specific licence when required for the intended activity;
• accounting arrangements, tax registration and corporate records;

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.

Documents Required from the Founder and Beneficial Owner

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:

• a passport and proof of residential address;
• the director’s CV and evidence of relevant professional experience;
• a business description, business plan and cash flow forecast;
• an ownership chart identifying the ultimate individual owner;
• evidence confirming the source of capital;
• constitutional documents of a corporate shareholder;
• draft articles of association, the founder’s resolution and registered-office details;

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.

How to Register a Company in Luxembourg

Company formation in Luxembourg includes legal, registration, licensing and banking procedures. Some stages can proceed in parallel.

1. Select the legal form, business activities, ownership structure and management model.
2. Check the proposed name and obtain confirmation of its availability through the RCS.
3. Arrange the registered office and prepare the articles of association and KYC documents.
4. Open a share capital account and deposit the required amount.
5. Sign a notarial deed for an SARL or SA, or a private deed for an SARL-S.
6. File the company details with the RCS, publish the constitutional documents through RESA and disclose the beneficial owners in the RBE.
7. Obtain the business permit, tax numbers, VAT registration and social security registration if the company employs staff.

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.

RCS, RBE and Luxembourg Business Registers GIE

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.

Taxes for Companies in Luxembourg

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.

Cost of Setting Up a Company in Luxembourg

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.

Accounting and Reporting After Registration

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.

How to Receive Legal Service Offers Through Poshuk.info

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.