Ordinary Luxembourg company

 Ordinary Luxembourg company
Applicable legislationLaw of 10 August 1915 (“1915 Law”)
Authorisation and supervision by the CSSFNo
Qualification as an AIFNon-AIF, unless activities fall within the scope of article 1 (39) of the AIFM Law.
Exemption from AIFMD full regime under lighter regime (AIFMD registration regime)Possible.
Eligible investorsUnrestricted.
Eligible assetsUnrestricted.
Risk diversification requirementsNo risk diversification requirements.
Legal Form- SA, Sàrl, SCA
- SCSp
Umbrella structureNo.
Capital requirementsDepends of the form:
- SA / SCA: EUR 30,000
- Sàrl: EUR 12,000

No minimum capital requirement for other legal forms.
Required Luxembourg service providersRegistered auditor in principle not required unless the company is an AIF managed by an AIFM with AUM above the threshold or two of the following criteria are met:
(i) net turnover above EUR 8.8 million,
(ii) balance sheet above EUR 4.4 million and
(iii) average number of employees above 50. However, depending on the legal form of the company, there may be an obligation to appoint a commissaire aux comptes.
Possibility of listingYes
European passportNo, unless it falls under the scope of the full AIFMD regime.
Net asset value (NAV) calculation and redemption policyNot required.
Overall income tax (corporate income tax and municipal business tax)General aggregate rate: 24.94%, but 100% exemption for dividends, liquidation proceeds and capital gains from qualifying participations.
Subscription taxNo subscription tax.
Wealth tax0.5% on the NAV on 1 January.

Since 2017, this minimum net wealth tax for holding and finance companies (known as the Soparfis) - the fixed financial assets, intercompany loans, transferable securities and cash at bank of which exceed both 90% of their gross assets and EUR 350,000—is fixed at EUR 4,815 per year. The minimum net wealth tax for all other corporations has not changed; in other words, it is EUR 535 for companies with a total balance sheet up to EUR 350,000.
Withholding tax on dividends / interests and capital gainsDividends distributed by a Luxembourg company are in principle subject to withholding tax at a rate of 15%, unless a domestic law exemption or a lower tax treaty rate applies.
Benefit from double tax treaty networkYes
Benefit from the EU Parent Subsidiary DirectiveYes.
Thin capitalization rules (debt-to-equity ratio)No provision in Luxembourg law. However, there is a specific administrative practice.
Practical useHolding and financing activity, commercial activity, holding of IP, etc.