The Advantages of Opening a Holding Company in Luxembourg

The holding company is a structure designed to own various assets in one or more legal entities. The same definition applies to a Luxembourg holding company, which is one of the most popular types of business forms in the Grand Duchy.

Luxembourg holding companies have various advantages and can be used for different purposes. Our lawyers in Luxembourg descries some of these advantages below.

1. Easy incorporation process of the Luxembourg holding company

The requirements and procedure for opening a holding company in Luxembourg are quite simple: it only requires one shareholder who does need to be a resident and the incorporation process is completed in a matter of days. Another requirement is for the holding company to have a local address in Luxembourg.

2. The Luxembourg holding can take various forms

The legal forms of a holding company are:

• - the private limited liability company;
• - public limited liability company;
• - partnership limited by shares;
• - cooperatives.

No matter the chosen form, the registration process with the Trade Register in Luxembourg is the same.

3. The holding company can be used for various activities

Another advantage of opening a holding company in Luxembourg is its uses. These uses are:

• - it can be used as a head office or operative office for several subsidiary companies;
• - it can be used as management company which administers the assets in other companies;
• - it can be used as a company with the purpose or managing financial or similar assets in its subsidiaries;
• - it can be used as an organizational company which manages the structures of other companies.

Our law firm in Luxembourg can offer more information the uses of holding companies and their advantages.

4. Privacy and tax benefits of a holding company in Luxembourg

Luxembourg is a preferred holding company destination because of the privacy it offers to the shareholders and directors. Also, from a taxation point of view, the holding company offers the following advantages:

• - deductions and exemptions for dividend payments if certain conditions are met;
• - holding companies can register or not for the value added tax in Luxembourg;
• - there is no subscription tax for holding companies in Luxembourg compared to other European jurisdictions;
• - Luxembourg holdings can take advantage of the country’s double taxation treaties with states all over the world.

For full information on the advantages of holding companies in the Grand Duchy, please contact our Luxembourg lawyers.