Can I be self-employed in Luxembourg ?

The first way to set up a business is to become self-employed, which is quite common in Luxembourg. This solution has the advantage of requiring very few formalities. A self-employed person carries out his or her activity on his or her own behalf and does not have to set up a specific company.

There is no obligation to have share capital to be self-employed. No specific incorporation act is required, other than the basic administrative steps. However, an establishment permit is required and must be requested from the Ministry of the Economy, together with the necessary proof of the right to exercise your chosen profession. See recognition of diplomas and validation of professional experience.

A self-employed person must also have a VAT number in order to be able to issue invoices and collect the related VAT. However, below a certain level of turnover, you do not have to bill VAT.

Unlike employees, however, the self-employed must pay all their social security contributions. They must be registered with the CCSS, which enables them to contribute to the various insurance policies, including the one for the old age pension. They must also contribute to a specific accident insurance scheme depending on the profession in question.

They have the same rights as employees in terms of old age pension, maternity and parental leave. In the event of work incapacity, benefits will be paid from the 4th month on. In the event of unemployment, a self-employed person will receive benefit under certain conditions.

The second way is to set up your own company. In this case, in Luxembourg, the 2 most common business forms are the SARL and the SA.

The SARL (Limited Liability Company) requires a capital of 12,000 euros and at least 2 shareholders. The registered office must be located in the Grand Duchy of Luxembourg. The head of the company does not need to be a Luxembourg national. This form of company requires a certain number of formalities and the company is subject to a number of taxes, including a fixed registration fee, trade tax, wealth tax, corporate income tax and a VAT statement.

In the case of a simplified limited liability company, the company can be incorporated by private deed. The capital will be between 1 and 11,999 euros.

The SA (Société Anonyme - public limited company) requires a capital of 30,000 euros. One shareholder is sufficient. This corporate form, although intended for large companies, can be chosen by an SME.

So, ready to get started?

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03/2023