A major benefit of a SARL-S is the limited liability of the shareholders since they are only liable up to the amount of their contribution to the company’s share capital. Thus, creditors cannot pursue personal assets of shareholders to pay business debts. A SARL-S is also beneficial since it does not require a significant investment. For those with limited capital to invest, a SARL-S provides flexibility since the minimum capital is 1 EUR. Thirdly, since no notary act is required in order to register this type of company, the registration process is relatively simple compared to other legal forms.

In order to form a Simplified Limited Liability Company, no notary act is required. Instead, the company can be formed by use of a private deed. The corporation’s articles of association must be written and lodged with Luxembourg Trade and Companies Register.

For a SARL-S, there must be at least 1 shareholder and no more than 100. They may be individuals in the country and cannot be companies. The name, occupations and residence of shareholders of every SARL-S must be kept in a register and each shareholder must be registered in the Trade and Companies Register. Additionally, a shareholder cannot have shares in another SARL-S.

The minimum capital of a SARL-S is 1 EUR and the maximum share capital is 12000 EU. The minimum capital must be paid in full and can be either cash or non-cash or a combination of both. After registration, an annual payment of at least 5% of the company’s net profits is required to be paid to a reserve until the amount totals 12,000 EUR.

The shares are registered shares and they cannot be issued to the public. Shares with voting rights are only allowed to be transferred to another partner with voting rights upon approval from partners totaling 50% or 75% of the shares.

A SARL-S is managed by one or multiple business managers as appointed by shareholders during a general meeting. These business managers are not required to be shareholders or residents. The managers can be appointed for a limited or unlimited time.

This meeting is attended by all shareholders and is chaired by the business managers of the company. There is minimum requirement of annual meetings if the number of shareholders is greater than 60.

There is no appointed board of directors in a SARL-S but if its business activities include commercial activities, at least one of the directors or shareholders has to fill the requirements in order to obtain business permit.

If the company has more than 60 partners, an internal supervision is required. The supervision can be represented by one or multiple persons, who can be shareholders or not.

An independent auditor is required to inspect the company’s books if an SARL-S exceeds two of the following for two consecutive financial years:

  • a balance sheet sum is more than 4,4 million EUR
  • a net turnover of 8,8 million EUR
  • 50 full-time employees (average of the year)

A SARL-S cannot be dissolved by the death, suspension, bankruptcy or insolvency of one of the partners. An exception exists if the articles of association state otherwise.

A SARL-S is liable to corporate taxation (IRC) at the rate of 16.05% per year for profit up to 15,000 EUR (profit = income – expenses) and 19.26% for profit exceeding 15,000 EUR. This tax includes contribution to the employment fund at the rate of 7%. The municipal business tax (ICC) will be due for commercial activities at the rate of 6.75% per year for profit exceeding 17,500 EUR. The dividends will be liable to withholding taxation at the rate of 15% per year (this rate can be reduced depending on the Double Taxation Agreements that Luxembourg has with your country)

 

SARL

SECA

SA

SE

Conditions

Minimum EUR 12,000 fully subscribed and paid up

Minimum EUR 30,000 fully subscribed with ¼ paid up on formation

Minimum EUR 120,000 fully subscribed with ¼ paid up on formation

Contributions

Contributions in cash or in kind (valuation by a statutory auditor, except for SARLs)

Contributions in industry (services or expertise) are not generally considered to form part of the share capital, but they can be recorded in the statutes and benefit from remuneration in the case of an SA or an SARL

Company shares

Registered company shares that can be transferred under strict conditions

Freely transferable registered or bearer shares/bonds or dematerialised securities

Constitutional document

Notarial deed published in full

Notarial deed published in full in the electronic compendium of companies and associations (Recueil électronique des sociétés et associations - RESA) and in the Official Journal of the European Union

Legal personality

Each capital company has a legal personality which is distinct from that of its partners
As a legal person, it has rights and obligations under commercial, accounting and fiscal law

Assets

A capital company holds its own assets

Decision-making bodies

General meeting + business manager or management board

General meeting

General meeting and board of directors meeting or general meeting, management board and supervisory board

Monitoring and legal auditing of accounts

Internal auditor (commissaire aux comptes) or statutory auditor (réviseur d’entreprises) for SARLs with more than 60 partners

Obligation to audit the company by a statutory auditor depends on size criteria

Internal auditor or approved statutory auditor

Obligation to audit the company by a statutory auditor depends on size criteria

Accounting and financial information

Annual accounts lodged with the Trade and Companies Register (Registre de Commerce et des Sociétés - RCS)

Number of partners

between 1 and 100

at least 2 (one limited partner and one general partner)

at least 1

Financial liability

Liability limited to the amount of contributions

Limited liability for the limited partner but unlimited liability for the general partner

Liability limited to the amount of contributions

ULTIMATE

  • Statutes and bylaws drafting
  • Notary fees
  • Power of attorney
  • Application for VAT
  • Capital bank account
  • Tax advise
  • Business permit

PREMIUM

  • Statutes and bylaws drafting
  • Notary fees
  • Power of attorney
  • Application for VAT
  • Capital bank account
  • Tax advise
  • Business permit

BASIC

  • Statutes and bylaws drafting
  • Notary fees
  • Power of attorney
  • Application for VAT
  • Capital bank account
  • Tax advise
  • Business permit

1 euro company Sarl-S

  • Drafting of statutes and bylaws
  • Registration in Luxembourg Business register
  • Application for VAT
  • Business permit
  • Capital bank account
  • Tax advise
  • Power of attorney