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Luxembourg

Luxembourg provides a unique low-tax environment for international investors and it is also a founder member of the EU.

The country is widely used in corporate structuring for cross border transactions, but due to its place in Europe’s political environment it is constantly adapting its tax legislation to avoid adverse conflict with the tax authorities of other EU countries.

Due to its progressive and adaptive approach, Luxembourg is, and will remain, a beneficial country for international business structuring.

As a result, Luxembourg’s tax laws frequently come under scrutiny from other EU states and are prone to change.

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Luxembourg is not a low-tax environment for everyone; purposely the tax benefits in Luxembourg are carefully structured to ensure minimal disruption with other EU countries.

These are the main forms of standard-tax business entity:

• Joint Stock Company (SA), minimum share capital €31,000; requirements include at least three directors, a registered office in Luxembourg, and audited accounts if the company exceeds a certain size

• Limited Liability Company (SARL), minimum share capital €12,400, no more than 40 shareholders; requirements include at least three directors, a registered office in Luxembourg, and audited accounts subject to size

• General Partnership, limited partnership, and branch of foreign company.

There is one main kind of low-tax business entity – the SOPARFI. In fact, it would be more accurate to define a SOPARFI as tax-efficient rather than low-tax.