Luxembourg Company Management 2018-08-07T12:12:20+00:00

Luxembourg Company Management

THE SCF GROUP HAS BEEN FORMING AND MANAGING LUXEMBOURG COMPANIES FOR OVER 25 YEARS

LUXEMBOURG – COMPANY MANAGEMENT  

LUXEMBOURG MANAGED COMPANIES

Synopsis

Luxembourg is the original ‘tax haven’ within the European Union with its companies having been long employed within tax planning ‘sandwiches’ particularly in conjunction with Dutch NV and BV companies. The reason it is so popular especially for multi-nationals is that local companies with the correct fiscal election – In Luxembourg there are only two major companies; sociétés à responsibilité limitée (Sàrl’s) and sociétés anonyme (SA’s) – can be very tax efficient. In addition, Luxembourg is a founder member of the EU and by definition will fully benefit from all key EU Directives and Regulations (see below) not to mention its remarkably developed tax treaty network. The Duchy of Luxembourg was originally founded in 963 and was one of the six founding members of what is now called the European Union. Although being one of the smallest EU members it is by far the wealthiest with a per capita GDP of over US$109,100 (2017 est.) and within the top five wealthiest countries in the world. Luxembourg’s wealth derives from a highly developed and industrialised economy combined with a very powerful banking and financial sector making it a true and long established competitor to Switzerland. From a tax planning perspective, the Luxembourg Sociétés de Participation Financière (SOPARFI’s) tax election (applicable to both Sàrl’s and  SA’s) are very popular amongst medium to large companies because they are well regulated, benefit from an excellent local tax treaty network and of course key EU Directives such as the Parent Subsidiary Directive 90/435 (which allows dividend payments to be paid between EU member states without any withholding taxes) and Directive 03/49, which basically does the same but for interest rather than dividend payments within the EU. The only major downside is that Luxembourg companies (be they trading or as is more usual holding SOPARFI companies) are, not unexpectedly, expensive to set-up and to administer. The population is 594,130 (July 2017 est.)

Work RATINGS
Corporate registration efficiency 5
Cost 5
Confidentiality 4
Local Banking facilities 5
Legal system 5
Political stability 5
Reputation 5
Smiley face
Location
Luxembourg is located in North-West Europe bordered by France, Belgium and Germany.

TAX PLANNING CREDENTIALS

Companies

In Luxembourg there are only two major companies; sociétés à responsibilité limitée (Sàrl’s) and sociétés anonyme (SA’s). In most cases, clients will choose to register a SA since these types of companies (basically equivalent to British/Irish public limited companies or PLC’s), do not require subscriber details to be kept on the public register. However, in the case of Sàrl’s, (basically equivalent to a British/Irish private limited company) such information is required to be kept on public record.

A Soparfi (an acronym for “Société de Participation Financière”) is not a specific type of company, rather it is a special tax regime for a resident company that holds and manages the shareholdings of subsidiaries. The Sopfari is fully subject to the Luxembourg corporate tax rate which presently has been decreased for 2018 to 18% (excluding contribution to unemployment fund and municipal business tax). This entitles local companies to enjoy and benefit from key EU Directives, such as the parent subsidiary directive 90/435, and have access to Luxembourg’s extensive Double Tax Treaty network. In addition, the Soparfi is also entitled to the Luxembourg participation exemption providing full exemption of dividends, capital gains and liquidation proceeds. To qualify for the exemption, the holding must be of 10% of the share capital, or an amount of €1.2m or €6m for capital gains, the holding is for a 12-month period and the distributing company pays 11% corporate tax or benefits from EU 90/435(see above).

Benefits

  • Pro-business environment;
  • Highly respectable and credible jurisdiction;
  • Highly educated population;
  • Highly developed corporate and general law;
  • Excellent communications with the rest of Europe including close geographical proximity to Belgium, The Netherlands, Germany and France;
  • Active and positive member of the European Union;
  • Fully benefits from all EU Directives and Regulations;
  • It is one of the initial 11 Euro zone countries;
  • Excellent double taxation treaty network especially with the Netherlands;
  • Few scandals;
  • Luxembourg is the base for Europe’s largest international financial services centre (IFSC) with Dublin coming in a close second;
  • Very sophisticated banking and corporate law together with a large ‘pool’ of highly trained multilingual professionals;
  • SOPARFI’s are fully covered by Luxembourg’s tax treaties and can also avail of the EU Parent/Subsidiaries’ Directive;
  • ‘Bearer’ shares can be provided for SA companies;
  • Luxembourg’s banking community have maintained much of their confidentiality code despite recent attacks on its veracity by Germany. In addition, bank account facilities can be maintained outside of the Luxembourg jurisdiction

Double Taxation Treaty Network

The key benefit is that Luxembourg has an extensive and very favorable tax treaty network with most European countries despite its favorable holding company structures especially with the Netherlands and its NV and BV companies.

ADMINISTRATION & ACCOUNTANCY SERVICES

Managed Luxembourg SOPARFI Companies

The key service offered by the SCF Accountancy & Law is that of a fully managed Luxembourg SOPARFI company where-by we can register your Company, act as the daily legal and accountancy administrators, liaise on your behalf with the Revenue, Luxembourg Company House, maintain the registered office, company minutes and in fact everything necessary to provide you with a fully functional VAT registered Luxembourg holding company including VAT returns, online banking, management and meeting rooms etc. – In fact, our Luxembourg SOPARFI services are totally bespoke according to your needs.

Set-Up & Annual Maintenance Fees

Please see separate SCF Accountancy & Law Luxembourg SOPARFI Fee Quotation

For more information on Luxembourg companies please contact a SCF Consultant.

PRIORITY ENQUIRY FORM

(Strictly Confidential No Obligation)

SCF International is the trading name of SCF Corporate Services Limited

Address: 1st Apriliou 47, Limassol, 3117 Cyprus

Telephone: +357 99 186 888   Email : enquiries@scfgroup.com

Registration number HE 341030

Malaysia: KL Marketing Office, B-7-6, Megan Avenue II, Jalan Yap Kwan Seng, 50450 Kuala Lumpur, Malaysia

© SCF INTERNATIONAL 2018

A FULL RANGE OF LEGAL, ACCOUNTANCY & COMPANY MANAGEMENT SERVICES

The SCF International specializes in providing accountancy services for Cypriot limited companies, Cypriot company management services including the provision of (where necessary) domestic directors, domestic company secretaries, registered office address services, trading offices, value added tax (VAT) registration and management, payroll (Pay as You Earn PAYE), opening up and managing bank account facilities, raising invoices and any and/or all other services required to establish a bone fide managed and controlled UK limited liability company.

The SCF International also specializes in providing accountancy services for Irish limited companies, Irish company management services including the provision of (where necessary) domestic directors, domestic company secretaries, registered office address services, trading offices, value added tax (VAT) registration and management, payroll (Pay as You Earn PAYE), opening up and managing Irish bank account facilities, raising Irish invoices and any and/or all other services required to establish a bone fide managed and controlled Irish limited liability company.

Our in-house team of legally and accountancy qualified experts can also provide advice on current UK & Irish tax laws/provisions including anti-avoidance provisions, EU directives and regulations, the impact of BREXIT for both UK and EU based businesses and other relevant. In addition, where required the SCF Group can also set-up and arrange the management of companies in tax attractive EU based jurisdictions such as Cyprus, Luxembourg or Malta or indeed any jurisdiction in the world including those in the Middle and Far East.

Property de-enveloping services – In conjunction with leading UK firms of solicitors SCF International can help transfer companies currently held by what were known as ‘offshore’ companies into either more tax efficient UK companies or directly back into the names of individual beneficial owners’ often without attracting stamp duty land tax (SDLT) but still avoiding the advance tax on enveloped dwellings (ATED). For more information please see http://www.de-enveloping.co.uk

Our fiscal migration and tax planning department is operated by qualified lawyers and accountants and can advise both domiciled and non-domiciled individuals on how to mitigate their individual and corporate tax exposure be it in Cyprus or internationally. Our legal & business department can provide specialized advice on all domestic and international tax planning issues but also upon ‘key’ issues such as asset protection be it in the form of trusts, private interest foundations (PIF’s), pre-nuptial and post-nuptial agreements, divorce and general family law, legal drafting, leave to remove applications etc