GoReduced corporate tax
Since 2025: 14 % for smaller and 16 % for larger incomes (total rate Luxembourg City ~23.87 %).
Company formation
Company Formation in Luxembourg
Luxembourg is a leading EU financial and fund location with a stable legal environment and international outlook. Besides the classic SARL, the SARL-S enables formation from €1 without a notary. Legal status: 2026, without guarantee.
CIT 14/16 %SARL-S from €1 without notaryworld's #2 fund location
Key figures
Luxembourg at a glance
14 %
CIT < €175,000 income (since 2025)
1 €
SARL-S formation from (no notary)
1–3 weeks
Typical formation time
#2
Fund location worldwide (after the USA)
Advantages
What speaks for Luxembourg
SOPARFI holding
Participation exemption for qualifying stakes — an established holding location.
Low-threshold entry
The SARL-S can be formed from €1 and without a notary (natural persons).
Tax comparison
Example: €100,000 profit
| Germany | Luxembourg | |
|---|---|---|
| Corporate tax | ~30 % (effective) | CIT 14/16 %; total ~23.87 % (Lux City) |
| Tax on €100,000 profit | ~€30,000 | ~€23,870 |
| Special feature | Municipal trade tax | SOPARFI participation exemption for holdings |
From April 2026, a capital-deferral reform applies to the SARL.
Legal forms
Legal forms at a glance
| Legal form | Minimum capital | Liability | Typical use |
|---|---|---|---|
| SARL | €12,000 | limited | Standard SMEs |
| SARL-S (simplified) | €1 to €12,000 (natural persons only, no notary) | limited | Low-capital formation |
| SA | €30,000 | limited | Larger firms, funds |
| SOPARFI (holding) | like SARL/SA | limited | Participations (exemption) |
Process
How incorporation works
Legal form
Choose SARL, SARL-S or SA.
Capital / bank certificate
Obtain the capital certificate.
Formation deed
Notary; SARL-S by private deed.
RCS registration
Registre de Commerce et des Sociétés.
Tax/VAT registration
Register with the tax authorities.
Business permit
Obtain the autorisation d'établissement.
1–3 weeks.
Costs
Costs (indicative)
SARL: notary/registration several thousand €; SARL-S considerably cheaper (no notary) (indicative).
Taxes
Corporate taxes
| Item | Rate |
|---|---|
| Corporate tax (income < €175,000) | 14 % (since 2025) |
| Corporate tax (> €200,000) | 16 % |
| Total rate Luxembourg City (incl. surcharge + municipal tax) | ~23.87 % |
| Holding (SOPARFI, qualifying stake) | participation exemption |
Knowledge check
Worth remembering
Tap a card to reveal the answer. Content AI-assisted and editorially reviewed.
SARL minimum capital?
Show answer
€12,000 (SARL-S from €1).
CIT for small companies?
Show answer
14 % (since 2025).
Holding form?
Show answer
SOPARFI (participation exemption).
Location in numbers
Luxembourg in numbers
| Metric | Value |
|---|---|
| Fund location worldwide | #2 (after the USA) |
| CIT reform | cut in 2025 (14 %/16 %) |
| SARL-S capital | from €1 |
Latest developments
Latest developments (as of July 2026)
- CIT cut since 2025 (14 %/16 %).
- Capital-deferral reform for the SARL from April 2026.
- SARL-S remains the low-threshold entry.
FAQ
Frequently asked questions about Luxembourg
SARL or SARL-S?
SARL €12,000 with notary; SARL-S from €1 without notary (natural persons only).
How high is the tax?
CIT 14 %/16 %; total rate in Luxembourg City ~23.87 %.
What is a SOPARFI?
A holding form with participation privilege (exemption).
How long does formation take?
1–3 weeks.
Related countries
These locations might also interest you
Company formation
Belgium
CIT 25 % (SME 20 %)BV/SRL without minimum capital
Country guide
Company formation
Netherlands
CIT 19 % up to €200,000BV from €0.01
Country guide
Company formation
Switzerland
effective from ~12 %GmbH from CHF 20,000
Country guide
Sources & disclaimer
Sources
This page is for general information only and does not replace legal or tax advice. Binding information is provided by the competent authorities of the respective country and by lawyers, notaries and tax advisors licensed there. For the tax consequences of relocating from Germany or Austria, tax advisors licensed in those countries are responsible. All information without guarantee. Status: July 2026. For an individual assessment: contact@goglobal.associates.
Questions about this location? Get in touch – no obligation, no sales pressure.