Cost of Setting Up a Company in Luxembourg

Published on October 3, 2025 and written by Cyril Jarnias

Luxembourg, a true economic hub at the heart of Europe, is attracting more and more entrepreneurs eager to benefit from its advantageous tax environment and political stability. However, before embarking on the entrepreneurial adventure in the Grand Duchy, it’s crucial to fully understand the costs associated with company formation. In this article, we’ll break down the various financial aspects to consider, enabling you to plan your project with precision and realism.

Initial Outlay for Establishment: Essential Registration Fees

The first step in creating your company in Luxembourg involves officially registering it with the competent authorities. This process entails several fees that are important to budget for from the start.

Notary fees: A mandatory step

In Luxembourg, forming a company requires the involvement of a notary to authenticate the articles of association. Notary fees typically range between €1,800 and €3,000, depending on the complexity of your structure and your company’s share capital. This amount covers not only the drafting and authentication of the articles of association but also the filing fees with the Trade and Companies Register (RCS) as well as registration fees.

Registration with the RCS: Formalizing your existence

Once the articles of association are authenticated, your company must be registered with the RCS. Registration fees are set according to a fee schedule that depends on the chosen legal form and the type of document filed. For a standard LLC, expect around €250 for the initial registration.

Publication in the RESA: Informing the public

The formation of your company must be published in the Electronic Compendium of Companies and Associations (RESA). This formality, which informs third parties of your company’s existence, incurs additional fees of approximately €100.

Getting Compliant: Anticipating Compliance Costs

Creating a company in Luxembourg isn’t limited to registration fees. To operate legally, your company will need to comply with various regulations, which generates additional costs.

Business permit: Your key to entrepreneurship

Any commercial activity in Luxembourg requires a business permit. The fees for obtaining this permit range between €24 and €2,500, depending on the nature of your activity. If you hire a professional to assist you with this process, budget an additional €1,500 to €2,000.

Tax compliance: An essential investment

To be compliant with the Luxembourg tax administration, your company will have to fulfill various obligations. This includes VAT registration (free but often requiring the assistance of an accountant) and setting up accounting that conforms to local standards. The annual cost for bookkeeping and preparing tax returns can range between €2,000 and €10,000, depending on the size and complexity of your business.

Data protection: A legal obligation

With the implementation of the GDPR, all companies must establish data protection policies. If you don’t have the expertise in-house, you will likely need to hire a specialized consultant, which can represent an initial cost of €1,000 to €5,000, depending on the complexity of your data processing.

Laying the Groundwork: Initial Investment for Takeoff

Beyond administrative and compliance fees, creating a company in Luxembourg requires an initial investment to concretely start your operations.

Share capital: The foundation of your business

The minimum share capital amount varies depending on the chosen legal form. For a standard LLC, expect a minimum of €12,000. This sum must be deposited into a blocked bank account before the company is formed. For an S.à r.l.-S (simplified limited liability company), the minimum capital is symbolically set at €1, which can be an interesting option for entrepreneurs with limited means.

Opening a bank account: A mandatory step

Opening a professional bank account is essential for your company. Opening and management fees vary by institution, but budget on average between €200 and €500 per year. Some banks may also require a minimum deposit higher than the legal share capital.

Equipment and supplies: Gearing up for success

Depending on your sector, you will need to invest in equipment, supplies, or software. For example, for a service company, purchasing computers, software, and office furniture can easily reach €5,000 to €10,000.

Staying the Course: Anticipated Operational Expenses

Once your company is created and operational, you will face recurring expenses to maintain your activity.

Office rental: A major expense item

Luxembourg is known for its high rents, particularly in the capital. For a modest-sized office (about 50m²) in Luxembourg City center, expect a monthly rent between €1,500 and €3,000. Outlying areas or coworking spaces can offer more affordable alternatives, with rates starting around €500 per month.

Social security contributions: Protecting your employees and yourself

If you hire employees, you will have to pay social security contributions. In Luxembourg, these contributions represent about 15% of the gross salary for the employer. For an average salary of €4,000 gross, this represents an additional monthly charge of about €600 per employee.

Professional insurance: Essential protection

Various types of insurance are necessary or highly recommended depending on your activity. Professional liability insurance, for example, can cost between €500 and €2,000 per year, depending on your sector and turnover.

Optimizing Your Budget: Smart Strategies to Reduce Costs

Faced with these various costs, fortunately, there are strategies to optimize your budget and reduce certain expenses.

Choosing an appropriate legal structure

The choice of legal form can have a significant impact on your initial and recurring costs. For example, the S.à r.l.-S allows you to start with a minimum capital of €1, which can be advantageous for testing a concept before fully committing. However, keep in mind that this legal form imposes certain restrictions, particularly on profit distribution.

Taking advantage of aids and subsidies

Luxembourg offers numerous aids to businesses, particularly in sectors that are innovative or a priority for the national economy. For example, the “Fit 4 Start” program offers support and funding of up to €150,000 for innovative startups. Inquire with the House of Entrepreneurship or Luxinnovation to identify the aids for which you might be eligible.

Opting for flexible solutions

To reduce your fixed costs, consider flexible solutions, especially for your premises. Coworking spaces or shared offices can offer an economical alternative to traditional commercial leases, while allowing you to benefit from a professional environment and shared services.

Outsourcing certain functions

Rather than hiring full-time staff for all functions, consider outsourcing certain tasks. For example, using an external accounting firm can prove more economical than hiring a full-time accountant, especially in the first years of operation.

Conclusion: A Strategic Investment for a Promising Future

Creating a company in Luxembourg certainly represents a significant initial investment, but it is also a strategic choice that can prove extremely profitable in the long term. With its tax advantages, political and economic stability, and central position in Europe, the Grand Duchy offers an environment conducive to business development.

By correctly anticipating the various costs related to the creation and operation of your company, you give yourself the means to succeed in this dynamic ecosystem. Remember that every expense should be viewed as an investment in the future of your business.

The key to success lies in meticulous planning, rigorous cost management, and smart exploitation of the opportunities offered by Luxembourg. With the right preparation and an adapted strategy, your company can fully leverage the unique advantages offered by this country at the heart of Europe.