Step 1: Prerequisites
Trading name: Before setting up a company, you can check the availability of the trading name you plan to use. An availability request can be submitted online to the Trade and Companies Register.
Share capital: The minimum share capital required to establish the company must be deposited in a bank account before the articles of association are signed. The amount is merely blocked until the company is formed.
Before applying for a business permit, it is essential that applicants ensure they satisfy the following business permit conditions:
- professional integrity
- professional qualification with regard to the planned activity
- establishment in Luxembourg; a business permit is only granted if there is a physical installation in Luxembourg that includes infrastructure suitable for the nature and scale of the activity concerned
- effective and permanent management of the business by the business permit holder who must:
- manage and run the company in person, on a regular and daily basis (a distant home address could be detrimental to the application). The permanent presence of a third person, even if authorised to commit the business, is not enough to make up for the absence of the business permit holder
- be connected to the business (as an owner, associate, shareholder or salaried worker of the business)
- compliance with tax and business obligations: the business manager must not have evaded business and tax obligations in his previous or current business activities, whether these activities were carried out under their own name or through a company run by the said person.
Step 2: Business Permit
Most commercial activities, the crafts sector or certain liberal professions require a business permit from the the Directorate General for SMEs and Entrepreneurship of the Ministry of the Economy.
Applying for a business permit
Certain liberal professions are subject to a specific business permit
Before they enter Luxembourg, third-country nationals must apply for a temporary residence permit together with their business permit application. EU nationals are entitled to free circulation within the EU, meaning they can live and work anywhere in the EU. Given the importance of the ICT sector in Luxembourg and the number of vacant job positions in this sector, the Government has decided to grant the Blue Card (for which a minimum salary of EUR 57,556.80 is required) to non-EU nationals who work in one of the professions defined in certain ISCO-08 codes.
Incorporation and registration
Step 3: Incorporation and registration
Whatever their legal form, Luxembourg-based businesses must be registered with the Luxembourg Trade and Companies Register.
Setting up and registering a business
Registration with the Social Security Administration
Step 4: Registration with the Social Security Administration
The holder of the business permit must register with the Joint Social Security Centre (Centre commun de la sécurité sociale - CCSS) either as a self-employed worker or as a salaried employee.
Registering as a self-employed worker
Registering a salaried employee
Before they register salaried workers, the business must register as an employer.
Registration with the Tax authorities
Step 5: Registration with the Tax authorities
Luxembourg-based businesses must register for VAT with the Luxembourg Land Registration & Estates Department (Administration de l'enregistrement et des domaines - AED).
The Luxembourg Inland Revenue (Administration des contributions directes -ACD) should be contacted.
Registering for Value Added Tax (VAT)
For income tax queries, the Luxembourg Inland Revenue contacts businesses directly by post.