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Company Formation Luxembourg

Updated on Friday 11th May 2018

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Any person or legal entity, national or foreign, can be a shareholder or a director in a Luxembourg company. Clients must know that, according to the Commercial Law in Luxembourg, companies must have a registered office. Our company formation agents in Luxembourg can assist investors in setting up their companies.

The following steps must be followed for company registration in Luxembourg:

First of all, the client must choose the name of the company and set-up the bank account where the initial share capital will be deposited. In order to set up the bank account, the client must present identification documents such as: passport copies, identification cards or driver license, a recent utility bill or a bank statement as proof of residential address, a detailed CV, a certificate of good standing issued by the bank and possibly other documents or application forms.

After the bank account has been set up, the client must deposit the initial share capital that the bank will block until the company is incorporated.
The next step will be drawing all the documents related to the formation of the Luxembourg company. This process can be done personally or by representation based on a notarized power of attorney.

Once all the documents are ready, they can be submitted for approval with the Trade Register in Luxembourg.

BridgeWest provides company formation in Luxembourg. Our assistance includes:
      -  drawing up the articles of association that can be signed through power of attorney (Luxembourg laws require power of attorney for any public notary proceedings);
      -  drawing up documents for company incorporation in Luxembourg: specimen signatures, identification papers copies, application form required by the Luxembourg Company Registration Office;
      -  arranging public notary proceedings (all procedures for company incorporation are done in front of a Luxembourg public notary);
      -  providing a registered office in Luxembourg on demand; the registered office serves as headquarters for the company in Luxembourg and it will be made public;
       - setting up a bank account for the company in Luxembourg; BridgeWest will help in setting up the share capital bank account, as well as a current bank account once the company is incorporated;
       - recommending a Luxembourg accountant, as accounting services are needed for new businesses in Luxembourg. 

Types of companies in Luxembourg

- limited liability company in Luxembourg (Societe a Responsabilite Limitee – SARL) - The Luxembourg limited liability company is the most common type of business as it allows a minimum of one shareholder and a maximum of 40 and a director. The minimum share capital for a S.A.R.L. in Luxembourg is 12,500 EUR and it must be paid in full upon incorporation. The shareholders will be held liable to the extent of their participation for the company’s debt and obligations.

joint stock company in Luxembourg (Societe Anonyme - SA) - The Luxembourg S.A. requires a minimum share capital of 31,000 EUR and a quarter of if must be paid upon incorporation. It requires a minimum of one shareholder who can be an individual or a legal entity. The shareholders will be held liable to the extent of their participation for the company’s debt and obligations.

SOPARFI company in Luxembourg (Société de participations financières) - The Luxembourg SOPARFI company is a firm that has financial investments and it can be incorporated as a S.A.R.L. or S.A. company. The SOPARFI company benefits from Luxembourg’s “inter-corporate” privilege and benefits from attractive taxes, which is why it is very popular among foreign investors.

- general partnership in Luxemburg The Luxembourg general partnershiprequires at least two shareholders and a director who will be held fully liable for the company’s debts and obligations. There is no minimum share capital required in cases of Luxembourg general partnerships.

- limited partnership in Luxembourg The Luxembourg limited partnership must be formed by at least two shareholders. One of them will act as a general partner and will have full responsibility for the company and management rights, as well. The limited partner will be held liable for the company’s debts and obligations to the extent of his or her share contributions.

- Luxembourg Branch, Subsidiary or Representative Office - Foreign companies are allowed to set up separate enterprises from the parent company, where the foreign company will be a shareholder in a Luxembourg company. Foreign companies can also open extensions of the parent company in Luxembourg.

Taxation in Luxembourg

The standard VAT Rate in Luxembourg is 15%, but reduced rates of 6% and 3% apply to certain products.

The corporate tax rate in Luxembourg is 22.47% and it includes a 7% employment fund contribution. An additional municipal business tax also applies depending on the city the company is in (the municipal business tax in Luxembourg is 6.75%).

The dividend tax in Luxembourg is 15%, unless it is reduced by tax treaties.

BridgeWest is also able to offer ready-made Luxembourg companies and VAT registration.
Please contact us for more information and prices.

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