Category: Non classé

Since 01/01/2017, All self-employed people with a yearly turnover of more than EUR 100,000 should have an accrual accounting system. Below EUR 100,000 of yearly turnover and if you offer intellectual services, like consulting, you can have a cash basis accounting system.

In Luxembourg you have 7 month after the end of the financial year to publish company’s accounts. After that the RCSL (Luxemburgish business register) will fine you for late filing. The fine is equal to:

• EUR 50 excl. VAT if you are late of 1 month
• EUR 200 excl. VAT if you are late of 2 month
• EUR 500 excl. VAT if your are late of 4 month

So if you publish your aaccounts for the financial year 31/12/2016 on the 01/12/2017, you will have to pay a fine of EUR 500 excl. VAT.

• Having a physical address in Luxembourg:
  If you want to create a limited private company, you must have your business in Luxembourg. For this you can either opt for company domiciliation or rent an office or register your private limited company at your home.
  However, from a tax perspective, you need to prove that business management is performed in Luxembourg. This has the effect of prohibiting “letterbox companies”. Hence the domiciliation presents some tax risks…
  Also if you want to register your limited private company at your home and you are renting it, you must ensure that the lease contract does not prohibit commercial activities.

• Having a business permit:
  It is mandatory for any limited private company. This authorization must be requested from the Ministry of the middle classes.
  Business permit is always personal. It depends on the integrity of the person and his professional qualifications.
  Thus, in the case of a limited private company, it is its manager who must make the request and on whom rests the business permit.
  There is no requirement that the holder of the authorization should be resident in Luxembourg but he must live not too far to be able to easily reach the location of its activity. Thus the Ministry admits a distance of about 200 km. If there are means of rapid transportation, the distance is increased. So someone living in Paris may be granted a business permit.

• Registration for VAT:
  If the activity is subject to VAT, you must register your business at the VAT administration (administration de l’enregistrement et des domaines). You can ask for exemption if your annual turnover is below a certain amount.

• Registration for social security:
  As  manager of a limited private company and if you have more than 25% of the shares, you will be considered as self-employed from the social security point of view.
  There is a monthly minimum of social contribution fees to pay but you also can ask for an exemption if your income is below a certain amount.

• Having a physical address in Luxembourg:
  As self-employed, you must have your business in Luxembourg. For this you can either rent an office or register your business at your home or client premises.
  Also if you want to register your company at your home and you are renting it, you must ensure that the lease contract does not prohibit commercial activities.

• Having a business permit:
  It is mandatory for any business and for the exercise of the vast majority of self-employed jobs. This authorization must be requested from the Ministry of the middle classes.
  Business permit is always personal. It depends on the integrity of the person and his professional qualifications.
  The professional qualifications of a self-employed can be proven either by his university degrees or his professional experience.
  There is no requirement that the holder of the authorization should be resident in Luxembourg but he must live not too far to be able to easily reach the location of its activity. Thus the Ministry admits a distance of about 200 km. If there are means of rapid transportation, the distance is increased. So someone living in Paris may be granted a business permit.

• Registration for VAT:
  If the activity is subject to VAT, you must register your business at the VAT administration (administration de l’enregistrement et des domaines). You can ask for exemption if your annual turnover is below a certain amount.

• Registration for social security:
  As self-employed, you will be automatically registered as you will need to withdraw your business permit at the social security administration.
  There is a monthly minimum of social contribution fees to pay but you also can ask for an exemption if your income is below a certain amount.