COMPANY FORMATION IN LITHUANIA
Lithuania holds the 11th position globally for ease of doing business, according to the World Bank Report “Doing Business, 2020.” The predominant form of business presence in Lithuania is a limited liability company, known as Uždaroji akcinė bendrovė (UAB) in Lithuanian. Translated, it means Closed Joint-Stock Company. The statutory capital of a UAB can be sold entirely or partially, shares can be donated, or they can be transferred from one generation to the next. A UAB is required to have a minimum of one owner (natural or legal person) and at least one director (natural person) authorized to sign on behalf of the company.
Company registration in Lithuania presents an opportunity to expand horizons, enter the European market at a cost-effective rate, and broaden the pool of potential customers. Positioned strategically, a Lithuanian company acts as a bridge between Russia, Ukraine, Belarus, other CIS countries, and the European Union.
Lithuania stands out as the most favourable country in the Baltic region for launching a business abroad, boasting a stable economy, a dynamic financial sector, and low-profit tax rates. Establishing a company in Lithuania signifies an elevation of business to global standards and opens avenues for growth. The Republic of Lithuania holds the second-highest position in Europe in the Investment Attractiveness Index, ranks 11th globally in the ease of starting a business, and has climbed 13 spots in the ranking of the freest economies. The labour market is supported by approximately 1.5 million professionals.
Choosing to register a company in Lithuania serves as a strategic move for establishing a transit point and gaining access to the expansive European market comprising 27 states. This approach allows for a substantial increase in potential clients and enables more efficient business operations. Entrepreneurs also have the option to open branches in any European Union country.
PACKAGE «ESTABLISHMENT OF A COMPANY IN LITHUANIA»
|1, 500 EUR
- The establishment of a company or the purchase of one that is already established
- Provision of the services with no hidden fees
- Drafting of required documents
- Notary services and state fees
- Assistance in registration of share capital
- Virtual office/legal address for 1 year / No need for a physical office in Lithuania
- Providing the list of banks for opening a bank account
- Private consultation with our Accountant
- The first month of accounting services free of charge (up to 10 transactions)
- 10% discount on legal services (if required)
Open business in Lithuania
CORPORATE SERVICES IN LITHUANIA
ADVANTAGES OF OPENING COMPANY IN LITHUANIA
Full remote re-registration of your company
Lithuanian corporate income tax starting from 5%
Lithuania holds the 11th position globally for ease of doing business
Cost-effective company registration compared to other EU nations
- Company registration costs are relatively low compared to other EU countries.
- Entirely remote company re-registration is possible
- The registration procedure takes no longer than 5 days.
- The profit tax rates are 5% and 15%.
- Trade within the EU is conducted without customs barriers.
- Double taxation is not applicable.
- Establishing a company in Lithuania grants eligibility for GNH (Gross National Happiness) benefits.
- There are no exchange control restrictions.
- VAT code registration and returns are facilitated.
The Republic of Lithuania stands out as an appealing jurisdiction for securing a residence permit in Europe, enabling unrestricted movement within the Schengen area without the need for a visa.
Lithuania’s tax system is characterized by its favourable nature, featuring some of the lowest rates across the European Union. Specifically, only 5% of profit is levied if the annual income is approximately EUR 289,620, and the number of employees does not exceed 10. The VAT rate is set at 21%. Additionally, entrepreneurs have the opportunity to employ legal avenues for tax exemption and circumvent double taxation, thanks to special agreements established with several countries.
Reach out to the Regulated United Europe to receive comprehensive details on the necessary steps to establish a company in Lithuania.
|Company formation in Lithuania
FORMS OF BUSINESS IN LITHUANIA
Foreign investors in Lithuania have four primary options for company registration:
- Public society (AB) – Analogous to a Public Company (AB)
- Private company (UAB)
- Partnership (TUB) or Limited Partnership (KUB)
- Branch or representation of a foreign company
All business entities must be registered in a single Register of Legal Entities. When initiating a business, the choice of legal form is crucial. The most prevalent options for company registration in Lithuania include a closed joint-stock company (UAB), a small company, and an individual enterprise. Statistics suggest that opting for a JSC is the most practical choice. Over 90% of Lithuanian enterprises are registered as closed joint-stock companies (UAB). Founders, up to 250 shareholders, can be natural or legal persons, with no restrictions on citizenship. Management bodies encompass the general meeting of shareholders, the supervisory board, and a head who can be an individual, including a non-resident. Alternatively, a collegiate body can manage the company instead of a sole manager. Lithuanian legislation mandates that the statutory capital of a closed joint-stock company must be no less than 2,900 euros. At registration, 25% is paid, with the remainder settled within a year. Funding sources include transfers from any bank, including international accounts, and cash deposits into the company’s savings account. The primary benefit of UAB is limited liability to creditors, ensuring shareholders and owners are not personally responsible for company debts. Mandatory audits are required if the company employs 50 or more people, its assets exceed 720,000 Euros, or its settlement accounts hold 1,400,000 Euros or more.
Lithuania is an appealing jurisdiction for obtaining a residence permit in Europe, facilitating visa-free movement within the Schengen area. The country’s tax system is favourable, boasting some of the lowest rates in the European Union. Profits are taxed at just 5% if annual income hovers around EUR 289,620 and the employee count does not exceed 10. The VAT rate stands at 21%. Entrepreneurs can leverage legal avenues for tax exemption and sidestep double taxation through agreements with various countries. The prevalent business form in Lithuania is a Limited Liability Company (UAB). Uždaroji akcinė bendrovė (UAB), translated as Closed Joint-Stock Company, allows flexibility in selling or donating shares, as well as passing them down through generations. A UAB must have a minimum of one owner (natural or legal person) and one director (natural person) who can sign on behalf of the company.
“As an experienced legal professional with a deep understanding of the nuances surrounding legal entities registration in Lithuania, I am committed to providing you with thorough and up-to-date insights to support your endeavours. My dedication extends to ensuring that you receive relevant and accessible information to navigate the regulatory framework and effectively progress with your projects in Lithuania.”
FREQUENTLY ASKED QUESTIONS
Opting for this route allows you to save several weeks, enabling your company to commence operations in the shortest possible time.
Registering a Lithuanian company offers strategic advantages, providing access to the European market at a low cost, expanding potential customer bases, and facilitating trade. With a stable economy, dynamic financial sector, and low profit tax rates, Lithuania is the premier destination in the Baltic region for starting a business abroad. Ranking second in Europe and 11th globally for ease of starting a business, Lithuania has climbed 13 places in the world's freest economies ranking. Boasting a labor market with approximately 1.5 million professionals, establishing a company in Lithuania becomes a strategic move to create a transit point and tap into the European market, allowing efficient business operations and the potential to open branches across the European Union.
Are there specific benefits associated with choosing a pre-established company in Lithuania rather than starting one entirely anew?
Absolutely, opting for a ready-made company offers notable advantages in terms of efficiency. The process of re-registering a ready-made company is significantly quicker when compared to the intricate procedures involved in setting up a brand-new entity from scratch. This accelerated timeline ensures a more prompt commencement of business operations for those choosing the ready-made company route.
Certainly, non-residents are welcome to register a company in Lithuania. The country actively encourages foreign investors and entrepreneurs to establish businesses within its borders. The registration process for non-residents is typically comparable to that for residents, and there are various legal structures available to accommodate different business needs.
Do Lithuanian companies have the flexibility to alter their names both before and after re-registration?
Kindly inform us of the new name you desire for your ready-made company purchase in Lithuania, and we will assist you accordingly, whether it's before or after the re-registration process.
No, there are no bank accounts linked to any of the shelf companies we provide. The former owners have closed all corporate accounts associated with these companies. We ensure that our clients receive companies with a clean slate, devoid of any existing bank account commitments or financial ties.
While Lithuania generally mandates a physical presence for specific steps in the bank account opening process, our team of specialists is ready to support you. We can offer alternative solutions and guidance to facilitate the remote bank account opening process.
As a reputable company broker, we conduct thorough due diligence on all shelf companies before presenting them to our clients. The companies we provide have undergone meticulous scrutiny, ensuring that our clients exclusively receive entities with a pristine history and no existing debts or financial obligations. Our commitment to transparency and diligence guarantees that our clients can confidently engage with companies that are free from any financial burdens.
In Lithuania, the standard corporate income tax rate stands at 15%. However, businesses with fewer than ten employees and gross income below 300,000 euros may be eligible for a reduction ranging from 0% to 5%. Lithuanian tax residents are typically taxed on income derived from both local and international activities. The calculation of taxable income for a tax period involves subtracting deductible expenditures from the total income.
Yes, companies established in Lithuania typically have an obligation to handle accounting. Adhering to proper accounting practices and financial reporting is crucial for compliance with local regulations and fulfilling legal obligations. This encompasses the maintenance of precise records of financial transactions, preparation of financial statements, and meeting any reporting requirements outlined by the Lithuanian authorities.
RUE customer support team
“Hi, if you are looking to start your project, or you still have some concerns, you can definitely reach out to me for comprehensive assistance. Contact me and let’s start your business venture.”
“Hello, I’m Sheyla, ready to help with your business ventures in Europe and beyond. Whether in international markets or exploring opportunities abroad, I offer guidance and support. Feel free to contact me!”
At the moment, the main services of our company are legal and compliance solutions for FinTech projects. Our offices are located in Vilnius, Prague, and Warsaw. The legal team can assist with legal analysis, project structuring, and legal regulation.