Company in Luxembourg
Luxembourg is a financial services center very sophisticated. The offshore banking and financial services has many years experience and is properly regulated. The country enjoys an excellent reputation in regard to confidentiality and privacy. The effective corporate tax is 30.38%, however, there are tax advantages for certain companies.
Commercial law :
There are 2 major types of companies mentioned in Luxembourg
- Heritage Society, 1929 (Holding Company), which must have a minimum capital of 31,000 EUR,
- Company Financial Participation 1990 (Societe Financiere de Participation - Soparfi) must have a minimum capital of 31,000 EUR.
The Heritage Society has the legal form of a SA, and is governed by the Act of July 31, 1929. You need at least 2 shareholders, as detailed in the registry. Also need 3 directors, who need not reside in Luxembourg.
Such companies are authorized to issue registered shares and bearer shares, preference and with or without voting rights.
The financial holding company needs at least 2 shareholders, whose details appear in the log. Also need 3 directors, who must be placed in Luxembourg. Such companies are authorized to issue registered shares and bearer shares, preference and with or without voting rights. This company is typically created as a holding company, if you want to be active, you must obtain authorization to do business.
Accounting and tax obligations :
Both the Heritage Society and the Society of Financial Participation are required to prepare and submit audited accounts. Holding the Heritage Society, 1929 or is exempt from taxes and their activities are restricted to holding shares and certain other investments. The only tax they pay is 0.2% of capital payable each year and 1% initial registration and subsequent capital increases
The financial holding company, Soparfi, is a company subject to corporation tax, which is required to pay normal tax rates and can access the benefits of double taxation. The only tax you pay is 1% initial registration and subsequent capital increases. .
The Soparfi, as a holding company, can benefit from the exemption on dividends and capital gains received from a subsidiary which has a 10% stake in the last 12 months. You can also obtain exemption for dividends received when it reaches a 10% stake, but the acquisition price is 1.2 million Euros, and capital gains when the purchase price is 6 millioneuros.