Doing business in Luxembourg
Questions? You’d better call Jacques.
Advice for everything you need to know about doing business in Luxembourg—from Jacques, our resident expert.
Luxembourg on your mind? Well, you’re not alone. The number of companies registered in Luxembourg has been growing at quite a rate. In fact, the government has many initiatives in place to welcome businesses of all sizes. From startups to large corporations, I guarantee there’s a place for your firm here.
If you’re considering relocating your business to Luxembourg but have gotten lost in the administration side of things, I am here to help you. So, stop your scrolling and ask me your questions directly.
Stability
AAA rating confirmed by S&P, Moody’s and Fitch
Economy
Highly open (OECD Economic Surveys)
Why choose Luxembourg to do business
Businesses tell me that these factors are particularly important in their decision to relocate to Luxembourg.
Select a factor below to see how Luxembourg is leading the way.
When it comes to stability, Luxembourg:
- has a AAA rating confirmed by S&P, Moody’s and Fitch
- maintained this rating during the pandemic
- is ranked in the top 4 for political stability by the World Intellectual Property Organization (PDF, 3.5MB)
When it comes to tax, Luxembourg:
- has competitive corporate tax rates
- offers a range of tax incentives to domestic and international businesses
- has a top VAT rate of 16%, the lowest in the EU
When it comes to talent and people, Luxembourg:
- is ranked in the top 10 of the IMD World Talent Ranking
- is ranked in the top 15 of the Global Talent Competitiveness Index
- has a range of tax incentives to domestic and international individuals
When it comes to innovation, Luxembourg:
- is ranked a top 20 innovative economy in the Global Innovation Index
- tops the rankings for attractive research systems, according to the European Innovation Scoreboard
- is home to 40% of all Tier IV data centers in Europe
When it comes to infrastructure, Luxembourg:
- made all public transportation free as of 1 March 2020
- is ranked 4th in the EU for connectivity
- scored 94.4 for infrastructure quality in the FM Global resilience index
Frequently asked questions about business in Luxembourg
Here are the questions that we are asked most often about business in Luxembourg.
How long does it take to set up a company in Luxembourg?
It takes around a week to get a company set up. You’ll need to make sure that you have all the information required, as well as a Luxembourg bank account. Once this is done, you can book an appointment with the notary to kick off proceedings.
How expensive is it to set up and maintain a business in Luxembourg?
The cost of setting up a business can be as little as EUR 4,000, depending on the company type. Maintenance, on the other hand, will set you back roughly EUR 15,000 a year for domiciliation, accounting, tax compliance, minimal corporate secretarial services and a director.
The cost of maintaining your company will be higher than EUR 15,000 if your business requires office space, further staff members, a business licence or help with monthly obligations like VAT returns and interim financial statements.
Is Luxembourg competitive in terms of tax and social security?
Yes, Luxembourg is competitive for both tax and social security. This is especially true of social security as contributions are capped for employers, employees, and the self-employed. For 2023, social security contributions are paid on annual remuneration up to EUR 143,243.76. Anything that you earn over this threshold is not subject to social security.
In terms of taxation, Luxembourg is competitive especially for investors but also for employees coming to the Grand Duchy with the possibility to benefit under certain conditions from the Inpatriate Regime.
Read more about tax and social security in our Luxembourg Income Tax Guide (PDF, 688KB).
Contact Jacques
Jacques Bortuzzo
Managing Director
KPMG Luxembourg
+352 22 51 51 5506
E-mail ›