Many entrepreneurs wonder how the creation of a company in Luxembourg is going. This country is a preferred destination for many foreign investors who want to expand their portfolios and profits in this part of Europe. The business environment offers an advantage in all important areas. In addition, the tax structure is very attractive. If you want to set up a business in Luxembourg and know the requirements in this regard, I invite you to read my guide on setting up a company in Luxembourg.
Here are the main types of businesses you can set up in Luxembourg:
The creation of companies in Luxembourg is quite simple. And it is very easy for foreign investors to open a company in Luxembourg. However, it is mandatory for the Luxembourg trade register that the statutes of the association and all other social documents be written in French or German. A bank account is mandatory for the initial capital deposit at the start of the company incorporation.
The registration of the company in Luxembourg is followed by the VAT registration of the companies which will carry out commercial activities. Registration for VAT in Luxembourg is completed by a declaration to the Administration de l’Enregistrement et des Domaines, then a VAT identification number is issued by the tax authorities.
There are two main types of low tax business entities. These are Holding 1929 and SOPARFI. In fact, it is more accurate to define them as tax-efficient companies rather than low-tax companies.
These companies are not legal entities in their own right. Instead, they use SA or SARL forms as the legal basis. The rules governing low-tax corporations are strict. And it is fundamental that the managers of the company respect them at all times. Otherwise, the business risks losing its low-tax status.
Foreign investors can buy shelf companies if they want to skip the paperwork of starting a business from scratch. Shelf companies are ready-made companies. Registered with the authorities, they are kept on “a shelf” until they age. These companies have no activity in the market. They therefore have neither debts nor obligations. A shelf company is trusted by financial authorities and banks.