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
PACKAGE «ESTABLISHMENT OF A COMPANY IN LITHUANIA» INCLUDES:
  • 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

Lithuania

  • 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
1,500 EUR

Lithuania

capital

Capital

population

Population

currency

Currency

gdp

GDP

 Vilnius 2,801,000 EUR $24,034

FORMS OF BUSINESS IN LITHUANIA

Foreign investors in Lithuania have four primary options for company registration:

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.

What types of companies exist in Lithuania?

Lithuania offers many opportunities for entrepreneurs and business people wishing to start or expand their business in Europe. The country is known for its innovative economy, attractive tax system and strategic location that provides easy access to European Union markets. Understanding the different types of companies available in Lithuania is a key aspect for any entrepreneur. Here is a detailed overview of the main forms of business in Lithuania:

1. Individual Entrepreneur (IP)

An individual entrepreneur (IP) is the easiest and fastest way to start a business in Lithuania. This type of business is suitable for single entrepreneurs and does not require authorised capital. Registration takes place at the Enterprise Registration Centre. An IP is fully personally liable for the obligations of his/her business.

2. Limited Liability Company (UAB)

Limited Liability Company (UAB) is the most popular form of business in Lithuania. It is suitable for both small and large businesses. The minimum authorised capital is 2,500 euros. The founders are liable only to the extent of their contribution to the authorised capital. UAB is required to register with the Business Registration Centre and to keep full accounting records.

3. Joint Stock Company (AB)

The joint-stock company (AB) is suitable for large companies with a large number of investors. The minimum authorised capital for an AB is 40,000 euros. Shareholders have limited liability in proportion to their shares in the capital. ABs are obliged to publish their financial statements and hold annual general meetings of shareholders.

4. Limited liability company (KŪB)

A limited company (KŪB) is a company that combines elements of personal liability and limited liability. In KŪB there must be at least one limited partner (investor who bears limited liability) and one general partner (who bears full personal liability). This type of company is suitable for family businesses or small businesses.

5. Limited Liability Partnership (TŪB)

A limited liability partnership (TŪB) is similar to a limited company, but all partners in a TŪB have limited liability proportional to their contributions to the share capital. TŪB is rarely used in Lithuania due to its specific structure and purpose.

6. Branches and representative offices of foreign companies

Foreign companies may open branches or representative offices in Lithuania to conduct business. A branch may engage in all types of commercial activities, while a representative office is limited to representative and marketing functions. Both types require registration with the Enterprise Registration Centre.

Conclusion

Choosing the right business form in Lithuania depends on many factors, including the size and type of business, number of founders, desired level of responsibility and investment needs. Understanding the specifics of each form of company will help you make an informed decision and ensure that your business in Lithuania gets off to a successful start. Regardless of the form chosen, it is important to consult with Regulated United Europe’s legal and accounting professionals to ensure compliance with Lithuanian law and tax requirements.

Table with current tax rates for companies registered in Lithuania for the year 2024. This data will help to get an idea of the tax burden on businesses and individuals in Lithuania.

Tax Name Tax Rate
Corporate Income Tax 15%
Value Added Tax (VAT) Standard Rate – 21%, Reduced Rates – 5%, 9%
Personal Income Tax Progressive Rate – 20% to 32% depending on income level
Social Tax Total Rate – 34.09% (19.5% pension contributions, 6.98% medical insurance, 1.77% unemployment insurance,
0.16% guarantee fund, 3% – tax for mother and child, 2.68% disability insurance)
Dividend Tax 15%
Average Salary 2023 Approximately 1,500 EUR (before tax deductions)

Please note that average salaries are pre-tax and may vary by sector, region and specialisation. It is also worth bearing in mind that tax legislation is subject to change, so it is advisable to consult a tax specialist or accountant for up-to-date information before making business decisions.

What is the amount of the authorised capital of a company in Lithuania?

The authorised capital of a company is the amount of resources contributed by the founders or shareholders to ensure the operation of the company at its foundation. In Lithuania, as in many other countries, the amount of the authorised capital depends on the form of the legal entity of the company. In this article we will look at the specifics of the authorised capital for different types of companies in Lithuania, which will help entrepreneurs to choose the most appropriate form for their business.

Limited Liability Company (UAB)

A limited liability company (UAB) is the most popular form of business in Lithuania. It offers flexibility in the conduct of business and limited liability for its founders. The minimum amount of the authorised capital for UAB is 2,500 euros. This amount must be paid in before the company is registered in the Register of Legal Entities. It is possible to contribute the authorised capital not only in cash but also in kind (property, intellectual property, etc.), the valuation of which must be confirmed by an appraiser.

Joint Stock Company (AB)

The Joint Stock Company is suitable for large businesses and companies planning to attract investments through the issue of shares. The minimum authorised capital for an AB is 40,000 euros. This amount of capital provides greater stability and trust from investors and creditors, but also requires a larger initial investment.

Individual entrepreneur (IP)

No authorised capital is required to register as an individual entrepreneur (IP) in Lithuania. This makes the IP form attractive for small businesses or aspiring entrepreneurs who want to minimise the initial costs of starting a business.

Limited company (KŪB) and Limited Liability Partnership (TŪB)

In a limited company (KŪB) and a limited liability partnership (TŪB), Lithuanian legislation does not establish a minimum amount of the authorised capital. These forms of companies allow the founders to determine the amount of contributions independently, which provides additional flexibility in business planning.

Branches and representative offices of foreign companies

Branches and representative offices of foreign companies in Lithuania also do not have specific requirements for the authorised capital. Instead, they must comply with the requirements of the parent company and the legislation of the country of origin.

Conclusion

The choice of the form of legal entity and the amount of authorised capital are important decisions when starting a business in Lithuania. These decisions affect the financial obligations, tax obligations, and the degree of responsibility of the founders.

Does a company in Lithuania have to have a local director?

Lithuanian legislation defines general requirements for company directors, but does not establish a strict rule regarding the necessity of their permanent residence in Lithuania. This means that a director of a Lithuanian company may be either a Lithuanian citizen or a foreign citizen, provided that he or she is authorised to manage the company in accordance with Lithuanian law and international agreements.

Functions and responsibilities of the director

A director (or the board of directors) in a Lithuanian company is responsible for the day-to-day management of the company, including the implementation of decisions of the shareholders’ (or founders’) meeting, maintenance of financial statements, compliance with Lithuanian law, and representation of the company’s interests in relations with third parties. A director is also responsible for compliance with corporate governance requirements and may be held liable in case of violation of the law.

Advantages of having a local director

Although having a local director in Lithuania is not a requirement, it can provide a number of advantages:

  • Improved interaction with local authorities and banks: The local director is more familiar with the local business climate, rules and regulations, which can facilitate the process of opening bank accounts and obtaining the necessary licences.
  • Language and cultural barriers: A local director can facilitate communication with Lithuanian customers, partners and government authorities.
  • Representation of interests: In the absence of founders in Lithuania, a local director may act as a representative of the company.

Options for foreign investors

Foreign investors who are unable or unwilling to appoint a local director may consider the following options:

  • Utilising the services of a management company: Many law and consulting firms in Lithuania offer professional director services, which can be a convenient solution.
  • Obtaining a residence permit or work permit: A foreign citizen may consider obtaining a residence permit in Lithuania, which also entitles him/her to manage a company.

Conclusion

On the question of whether it is necessary to have a local director in a company in Lithuania, the legislation provides flexibility without making it a mandatory requirement. However, in practice, having a local director can greatly simplify the management of the company and interaction with local structures. Foreign investors should carefully consider the pros and cons, and perhaps utilise the services of local management companies to ensure the smooth running of their business in Lithuania.

 What are the state fees for establishing a company in Lithuania?

Establishing a company in Lithuania is an important step for entrepreneurs seeking to expand their business or start a new venture in Europe. Lithuania offers a favourable economic environment, an attractive tax system and a strategic location in the European Union. However, as in any other jurisdiction, government duties and fees must be considered when establishing a company in Lithuania.

Limited Liability Company (UAB)

In order to establish a limited liability company (UAB), which is one of the most popular forms of business in Lithuania, entrepreneurs need to pay a state fee. The amount of the fee may vary depending on the chosen method of registration:

  • Standard registration through the Business Registration Centre will cost in the order of 30-40 euros.
  • Electronic registration offers a lower cost and can cost around €20.

Joint Stock Company (AB)

Establishment of a joint stock company (AB) in Lithuania, intended for large businesses and companies with several investors, also involves payment of a state fee. The cost of AB registration is similar to UAB and depends on the chosen method of filing documents.

Individual entrepreneur (IP)

There are nominal state fees for registration as an individual entrepreneur in Lithuania (IP). The fee for IP registration is usually lower and amounts to about 10 euros when submitting documents electronically.

Limited company (KŪB) and Limited Liability Partnership (TŪB)

For limited liability companies (KŪB) and limited liability partnerships (TŪB) the state fees are similar to those for UAB and AB. This is due to the fact that the registration procedures for these forms of companies require a similar amount of administrative work.

Branches and representative offices of foreign companies

Branches and representative offices of foreign companies in Lithuania are subject to registration and state duty is also charged for their establishment. The fee may be higher in comparison with local companies, taking into account additional verification of foreign documents. The fee may vary, but is tentatively between 40 and 100 euros.

Conclusion

When planning to establish a company in Lithuania, it is important to consider not only business plans and tax aspects, but also the amount of state fees, which may vary depending on the type of legal entity and the method of filing documents. Payment of state fees is a mandatory part of the registration process and should be done well in advance. Entrepreneurs are also advised to consider consulting with specialists from Regulated United Europe to ensure a smooth registration process and compliance with all local requirements.

 What is the annual cost of maintaining a company in Lithuania?

When considering doing business in Lithuania, one of the most important aspects for entrepreneurs is to assess the annual cost of maintaining the company. This aspect covers a wide range of costs, from government fees and taxes to accounting costs and office rent. In order to give entrepreneurs a complete picture, let’s take a detailed look at the main components of the annual cost of maintaining a company in Lithuania.

  1. State fees and taxes

Government fees and taxes account for a significant part of the annual cost of maintaining a company. In Lithuania, corporate income tax is 15%, which is one of the lowest in the European Union. In addition, there are property taxes, VAT (21%), employee payroll taxes (including social contributions) and others.

  1. Accounting and audit

The size of the company and the volume of operations affect the cost of accounting services. For small and medium-sized businesses in Lithuania, the annual cost of accounting services may vary from several hundred to several thousand euros depending on the complexity and volume of operations. Companies that are obliged to carry out audits should take into account additional costs for audit services.

  1. Legal services

Legal support for business, including advice on labour, tax and corporate law issues, also affects the annual cost of servicing a company. The cost of legal services varies depending on the complexity of tasks and the reputation of the law firm.

  1. Office rent

The cost of renting office space in Lithuania depends on the location, class of office space and its size. In Vilnius and other large cities the rental cost will be higher than in smaller cities or in the outskirts.

  1. Salaries of employees

Employee salaries are one of the main expenses of any company. In Lithuania, the minimum wage is set at around 730 euros per month (for 2023), but the actual labour costs depend on the qualifications of employees and the industry.

  1. Other expenses

Other expenses include the cost of utilities, communication and internet costs, marketing and advertising costs, insurance and other operating costs.

Conclusion

The annual cost of maintaining a company in Lithuania can vary significantly depending on the type and size of the business, the chosen industry and the level of operational activity. It is important for entrepreneurs to consider all potential costs in order to adequately plan the budget and optimise the tax burden. Competent accounting and legal support helps not only to reduce costs, but also to minimise the risks associated with doing business in Lithuania.

 What are the main advantages of setting up a company in Lithuania?

Lithuania, a country located at the crossroads of Eastern and Western Europe, has attracted more and more attention of entrepreneurs and investors from all over the world in recent years. Accession to the European Union and NATO, as well as the desire for innovation and technological development, have made Lithuania one of the most attractive places to do business. Let us consider the main advantages of establishing a company in Lithuania.

  1. Favourable geographical position

Lithuania occupies a strategically advantageous position in the centre of Europe, providing easy access to the markets of the European Union, Russia and the Baltic region. This makes Lithuania an ideal point for exporting and importing goods, as well as for expanding business into new markets.

  1. Attractive tax system

Lithuania offers one of the most competitive tax systems in Europe. The standard corporate tax rate is 15%, which is lower than in many EU countries. In addition, there are exemptions for small and medium-sized businesses, as well as for companies engaged in certain activities, such as information technology.

  1. Introduction of innovations and support for start-ups

Lithuania actively supports innovative projects and startups by providing grants, investments and tax incentives. The country successfully develops technology parks and business incubators, which offer convenient conditions for the development of young companies.

  1. Quality and affordable labour force

Lithuania is proud of the high level of education of its population. Many specialists speak English and other foreign languages, which facilitates communication and business interaction. At the same time, labour costs in Lithuania remain relatively low compared to other EU countries.

  1. Developed infrastructure and digital economy

Lithuania has a well-developed transport and digital infrastructure. The country is a leader in Europe in terms of internet speed and broadband coverage. The Lithuanian government e-services portal is one of the most advanced, which greatly simplifies business interaction with government agencies.

  1. European Standards of Business Practice

Enterprises in Lithuania operate in accordance with the norms and standards of the European Union, which ensures a high level of trust on the part of partners and customers. It also simplifies the process of exporting goods and services to EU countries.

  1. Support for foreign investors

The Lithuanian government actively attracts foreign investment by offering various support programmes, including assistance in obtaining permits and licences, as well as advisory support in choosing a business location.

Conclusion

Lithuania offers many advantages for establishing a company, including favourable geographical location, attractive tax system, support for innovation and start-ups, skilled workforce, developed infrastructure and digital economy, as well as strict European business standards. All this makes Lithuania one of the most attractive countries for doing business in Europe.

 What are the ways to set up a company in Lithuania?

Establishing a company in Lithuania opens the door for entrepreneurs to the European Union market and provides access to a number of economic and tax advantages. The process of company registration in Lithuania can be carried out in various ways, each of which has its own peculiarities, advantages and requirements. Let us take a closer look at the main ways of company incorporation in Lithuania to help entrepreneurs make an informed choice.

  1. Direct company registration

Direct registration is the most common and straightforward way of establishing a company. This process involves preparing and submitting the necessary documents to the Lithuanian Centre for Registration of Legal Entities (Register of Legal Entities). This will require incorporation documents, proof of authorised capital, details of directors and founders, and the address of the company’s registration.

  1. Registration through a notary

This method implies a personal application to a notary to certify the founding documents and their further submission to the Centre for Registration of Legal Entities. Registration through a notary is often used to establish companies that require notarisation of signatures or documents, for example, when contributing real estate or securities to the charter capital.

  1. Electronic registration

Lithuania offers the possibility of electronic company registration via the Internet, which is a fast and convenient way for entrepreneurs. Electronic registration requires the use of a qualified electronic signature, which allows signing documents online. This method is suitable for limited liability companies (UAB) and individual entrepreneurs.

  1. Registration through investment agencies

Foreign investors can use the services of investment agencies or consulting companies that offer a full range of services to set up a company, including preparation of the necessary documentation, legal support, assistance in opening a bank account and advice on tax planning.

  1. Buying a ready-made company

Buying a shelf company is another way to start a business in Lithuania. A ready-made company is already registered, which allows you to start operations as soon as possible without having to pay the authorised capital of the Lithuanian company to the new owner.

Conclusion

The choice of the method of company incorporation in Lithuania depends on many factors, including the specifics of the business, the requirements for the founding documents, the need for notarisation, and the entrepreneur’s preferences regarding the speed and convenience of the process. Regardless of the chosen method, it is important to prepare thoroughly for the registration process, follow the Lithuanian legislation and, if necessary, seek professional assistance. Establishing a company in Lithuania opens the door for businesses to a dynamically developing economy and provides access to a wide range of opportunities in the European market.

 Is it necessary to have a legal address in Lithuania?

According to Lithuanian law, every company registering in the country must have a legal address within Lithuania. This address is entered in the official register and is used as the official seat of the company. The legal address is necessary for correspondence with state authorities, tax authorities and for keeping official documents.

Functional value

A legal address fulfils several key functions:

  1. Legal representation: It serves as the official place to receive all legally relevant notices and documents from public authorities, courts and third parties.
  2. Tax registration: In order to register with the tax authorities and obtain a TIN, a company must provide a registered office.
  3. Business reputation: Having a registered office in a particular neighbourhood can affect the perception of a company by partners and customers.

How to provide a registered office

There are several options for securing a legal address in Lithuania:

  • Renting an office: One of the most obvious ways is to rent a commercial property to be used as an office and registered office.
  • Virtual office: For companies that do not need physical office space, a virtual office can be a cost-effective and convenient solution. A virtual office provides a legal address and often additional services such as postal services.
  • Use of legal and consulting services: Some law and consulting companies offer the service of providing a legal address for client companies.

Conclusion

Having a legal address in Lithuania is a prerequisite for establishing and further running a business. It plays a central role in legal representation of the company, tax registration and formation of business reputation. The choice of the method of securing a legal address depends on the specifics and needs of the business, as well as on the financial capabilities of the company. The right choice of a legal address can significantly simplify the process of registration and subsequent operation of a company in Lithuania.

 Is it possible to open a branch of a foreign company in Lithuania?

Lithuania, due to its strategic location in Europe, attractive tax system and business-friendly environment, is an attractive country for international companies seeking to expand their presence in the European market. One of the ways for a foreign company to start operating in Lithuania is to open a branch office. Let us look at the key aspects related to establishing a branch office of a foreign company in Lithuania.

Understanding the branch

A branch of a foreign company in Lithuania is not considered a separate legal entity, but a part of a foreign company. This means that a foreign company is fully responsible for the activities of its branch in Lithuania.

Advantages of opening a branch

  • Access to the European market: A branch allows a foreign company to quickly enter the Lithuanian and, consequently, the European market.
  • Reputation: Having a branch office in Lithuania can increase the credibility of the company among local clients and partners.
  • Tax incentives: Lithuania offers a number of tax incentives for foreign investors, which may be available for branches as well.

Steps to open a branch

  1. Preparation of documents: In order to register a branch office, it is necessary to prepare and translate into Lithuanian the founding documents of the foreign company, as well as the decision on the establishment of the branch office.
  2. Registration with the Registration Centre: A branch office must be registered with the Lithuanian Enterprise Registration Centre. The registration process includes submission of an application and relevant documents, as well as payment of the state duty.
  3. Appointment of an authorised representative: A foreign company must appoint an authorised representative in Lithuania to act on behalf of the branch.
  4. Opening a bank account: The branch will need to open a bank account with a Lithuanian bank to conduct financial transactions.
  5. Obtaining necessary licences and permits: Depending on the scope of the branch’s activities, additional licences and permits may be required.

Taxation of the branch

A branch of a foreign company is taxed on profits earned in Lithuania at the standard rate. It is important to take into account the tax treaties between the country of the foreign company and Lithuania to avoid double taxation.

Conclusion

Opening a branch office in Lithuania can be an effective way for a foreign company to start operating in the Lithuanian market, while providing access to the wide opportunities of the European market. It is important to prepare carefully for the registration process, to follow the Lithuanian legislation clearly and, if necessary, to seek the assistance of professional advisors to ensure the successful opening and operation of a branch office in Lithuania.

 Can a foreigner open a company in Lithuania?

In its endeavour to become one of the key business hubs in Europe, Lithuania actively attracts foreign investors and entrepreneurs. The country offers a favourable economic environment, attractive tax conditions and simplified procedures for starting and running a business. But the question arises: can foreign citizens open a company in Lithuania? The answer is yes, and in this article we will look at the key aspects and steps required to realise this task.

Legal aspects

Foreign citizens can open a company in Lithuania under the same conditions as locals. Lithuanian legislation makes no distinction between Lithuanian and foreign entrepreneurs in the matters of registration and running a business. This means that a foreigner may become the sole founder (owner) of a company or one of several founders.

Choice of company form

The most popular company forms for foreign investors in Lithuania are:

  • Limited Liability Company (UAB): Ideal for small and medium-sized businesses, the minimum authorised capital is 2,500 euros.
  • Joint Stock Company (AB): Suitable for large businesses with a large number of shareholders, minimum authorised capital 40,000 euros.

Company registration

The process of company registration for foreigners includes the following steps:

  1. Selection of company name: It is necessary to make sure that the selected name is not used by another registered company in Lithuania.
  2. Preparation of incorporation documents: Including the company’s articles of association and memorandum of association.
  3. Opening a bank account: To deposit authorised capital.
  4. Registration at the Centre for Registration of Enterprises: Submission of the required documents and payment of the registration fee.
  5. Obtaining a TIN and registration with the tax service.

Documents required

To register a company in Lithuania, a foreign citizen will need the following documents:

  • Passport or other identity document.
  • Documents confirming the place of residence.
  • Company documents translated into Lithuanian and notarised.

Features for foreigners

Foreign entrepreneurs must take into account several specifics:

  • Visa requirements: Depending on the country of origin, a visa or residence permit may be required to operate a company in Lithuania.
  • Accounting and taxation: It is important to familiarise yourself in advance with Lithuanian accounting and taxation rules.

Conclusion

Opening a company in Lithuania by foreign nationals is a fairly straightforward process, which nevertheless requires thorough preparation and understanding of Lithuanian legislation. Due to the attractive business environment, many foreign entrepreneurs choose Lithuania as a platform for expanding their activities. It is important to plan your actions in advance and, if necessary, seek assistance from professional legal and accounting advisors from Regulated United Europe.

Is it possible to obtain a residence permit when establishing a company in Lithuania?

Lithuania, as a member of the European Union, offers foreign entrepreneurs unique opportunities to do business and at the same time obtain a residence permit (residence permit). Establishing a company in Lithuania can be not only a path to a successful business, but also a means to ensure legal residence in the country and access to the benefits of European residence. In this article, we will look at the key aspects of obtaining a residence permit in Lithuania by establishing a company.

Basic terms and conditions

Lithuanian legislation provides for the possibility of obtaining a residence permit for foreign nationals who establish a company or invest in an existing business. In order to obtain a residence permit, an entrepreneur must fulfil the following conditions:

  1. Establishment or acquisition of a company in Lithuania.
  2. Investment: The minimum amount of investment in the company’s authorised capital must meet the statutory criteria.
  3. Creation of jobs: The company must create a certain number of jobs for Lithuanian citizens or EU residents.
  4. Proof of financial sustainability: The entrepreneur must prove the ability to support himself and his family in Lithuania.

The process of applying for a residence permit

  1. Company registration: The first step is to establish or acquire a company in Lithuania and fulfil all the requirements for starting a business.
  2. Preparation of documents: The next step is to prepare and submit a package of documents proving that you meet all the requirements for obtaining a residence permit.
  3. Submission of the application: The application for a residence permit shall be submitted to the Lithuanian Migration Service in person or through a representative.
  4. Application processing: The time it takes to process an application can vary, but usually ranges from a few weeks to a few months.

Advantages of residence permit in Lithuania

Obtaining a residence permit in Lithuania opens up many opportunities for foreign entrepreneurs:

  • Freedom of movement in the Schengen area: The holder of a residence permit is entitled to free movement and stay in the Schengen area.
  • Access to education and health care: Holders of residence permit have access to educational and medical services on equal terms with Lithuanian citizens.
  • Opportunity for family reunification: An entrepreneur can bring his/her family to Lithuania by applying for a residence permit for family members.

Conclusion

Establishing a company in Lithuania and subsequently obtaining a residence permit is a favourable solution for foreign investors wishing to expand their business and secure a stable future in Europe. It is important to prepare for the process thoroughly, carefully study all requirements and, if necessary, seek the assistance of migration law and business consulting specialists from Regulated United Europe to ensure successful obtaining a residence permit in Lithuania.

 What is stipulated in the articles of association of a company registered in Lithuania?

The Articles of Association of a company is the main document defining the legal status, structure, management and basic principles of a legal entity. In Lithuania, as in many other countries, the articles of association play a critical role in the life of a company, starting from the moment of its incorporation. In this article, we will take a closer look at what is usually prescribed in the articles of association of a company registered in Lithuania and why each of these points is important.

Name and legal address of the company

The Articles of Association must clearly state the full name of the company in Lithuanian and its registered office in Lithuania. The legal address is required for official correspondence and is the place of incorporation of the company.

Objectives and subject matter of the activity

The articles of association should specify the main objectives of the company and the types of economic activities it may engage in. This helps define the direction of the company and provides a legal basis for its business operations.

Amount and formation of authorised capital

The company’s Articles of Association must contain information on the amount of the authorised capital, as well as the procedure and terms for its formation. In Lithuania, the minimum amount of the authorised capital may vary depending on the type of legal entity.

Information on shareholders or founders

The articles of association must contain information on the persons who have established the company, their shares in the share capital and the rights that these shares confer.

Company management structure

A very important section of the articles of association that describes the governance structure of the company, including the management bodies (e.g. shareholders’ meeting, board of directors), their powers, decision-making and meeting procedures.

Procedure for amending the charter

The articles of association should define the procedure for amending them, which is important for the company to adapt to changing business conditions.

Reorganisation and liquidation of the company

The articles of association should set out the terms and procedure for reorganisation or liquidation of the company, including the distribution of assets in the event of liquidation.

Company responsibility

The articles of association should set out the basis of the company’s responsibility to its shareholders, creditors and other stakeholders.

Additional terms and conditions

The articles of association may also include other provisions appropriate to the specifics of the company’s business, such as those relating to the distribution of profits, record keeping and reporting.

Conclusion

The Articles of Association is a fundamental document for any company registered in Lithuania. It not only defines the legal framework for the company’s activities, but also serves as a basis for its internal organisation and management. The preparation of articles of association requires a careful approach and consideration of all aspects of the company’s future activities.

 How long does it take to set up a company in Lithuania?

Establishing a company in Lithuania is an attractive option for many foreign investors and entrepreneurs due to its business-friendly environment, strategic location and attractive tax system. However, one of the key issues when planning to launch a business is the time required to register a company. In this article, we will provide a detailed overview of the timeframe for establishing a company in Lithuania so that entrepreneurs can plan effectively.

Step 1: Preparing and submitting documents

The first step involves preparing the necessary documents such as the memorandum of association (or founder’s resolution), articles of association, proof of payment of share capital, and details of directors and founders. The time taken for this step can vary depending on the complexity of the preparation of the documents and the availability of all the necessary information. On average, it can take anywhere from a few days to a few weeks to prepare the documents.

Step 2: Registration at the Enterprise Registration Centre

After preparing and collecting all the necessary documents, the next step is to submit them to the Lithuanian Enterprise Registration Centre. In recent years, Lithuania has significantly simplified and accelerated the company registration process, including through the possibility of electronic filing of documents. The time required to register a company may take from 1 to 3 working days for electronic filing and up to 5 working days for paper filing.

Step 3: Obtaining registration documents and additional procedures

After a company is registered, the Enterprise Registration Centre issues a certificate of registration, the company’s articles of association with a registration stamp and an extract from the register. The company then needs to open a bank account and register with the tax authorities. These procedures may take an additional few days to a week.

Step 4: Tax registration and obtaining a TIN

The last step is to register with the Lithuanian Tax Service and obtain an individual tax number (INN) for the company. This process usually takes up to 5 working days after submitting the relevant documents.

Conclusion

In total, establishing a company in Lithuania may take from one to several weeks, depending on the specific circumstances, such as the complexity of the documentation preparation, the chosen form of filing (electronic or paper) and the promptness of additional procedures such as opening a bank account and registration with the tax authorities. Thanks to the Lithuanian government’s efforts to simplify and speed up the business registration process, Lithuania is an attractive jurisdiction for foreign investors wishing to start or expand their business in Europe.

 What kind of activities can a company engage in in Lithuania?

Lithuania, a country with a developed economy and a favourable business climate, offers a wide range of opportunities for entrepreneurs and investors. Accession to the European Union has opened new horizons for Lithuania, making it an attractive location for launching and developing a variety of business projects. In this article, we will look at what kind of activities a company can engage in in Lithuania, emphasising the flexibility and diversity of opportunities offered by the Lithuanian legislation and economy.

Information technologies and startups

Lithuania is actively developing its IT sector and becoming one of the leading centres of startup culture in Europe. The government offers various support programmes, tax incentives and simplified registration procedures for IT companies and startups. This makes Lithuania an ideal place for software development, fintech projects, cryptocompanies, games and other innovative products.

Manufacturing and industry

The manufacturing sector in Lithuania includes mechanical engineering, chemical, electronics and food production. Thanks to a skilled labour force and developed infrastructure, foreign companies can efficiently organise production in Lithuania, targeting both the domestic market and exports to EU countries and beyond.

Trade and exports

Lithuania has a favourable geographical location, which makes it a key transport and logistics hub in the Baltic Sea region. This creates favourable conditions for trading companies specialising in importing and exporting goods. Agricultural products, textiles, furniture and construction materials are just some of the goods successfully exported through Lithuania.

Service sector

The service sector in Lithuania also offers a wide range of business opportunities, including tourism, education, healthcare, financial and consulting services. The tourism sector is particularly promising due to Lithuania’s rich cultural heritage, beautiful nature and developed tourism infrastructure.

Agriculture

Lithuania has traditionally been strong in the agricultural sector, offering opportunities for the development of both traditional farming and innovative agro-technological projects. Organic farming, cereal cultivation, dairy production and livestock breeding are important areas for investment.

Conclusion

Lithuania offers foreign investors and entrepreneurs a wide range of business opportunities in various economic sectors. Flexible legislation, state support, strategic location and access to the European Union markets make Lithuania one of the most attractive countries for establishing and developing a company. The main thing is to thoroughly research the market and choose the business area that best suits your skills, interests and business goals.

 Does a company in Lithuania have to have employees?

In general, Lithuanian law does not impose a strict requirement on the minimum number of employees a company must have in order to operate. This means that, in theory, a company can operate without hired employees, relying on the services of its founders, director or third-party contractors, but at least one employee of the company must be registered with SODRA and pay social taxes on a monthly basis.

Exceptions and specific requirements

However, there are certain situations and activities in which the presence of employees becomes a prerequisite:

  1. Licensed activities: Some activities requiring a special licence (e.g. financial services, medical services, construction) may include requirements for qualifications and number of staff.
  2. State-supported projects: Companies participating in state-supported projects or receiving investment incentives are often required to create new jobs and hire a certain number of employees.
  3. Labour law regulations: It is important to remember that if a company employs workers, it is obliged to comply with Lithuanian labour law, including working conditions, minimum wages and social insurance.

Advantages of having employees

While there are no strict headcount requirements, hiring employees can bring a number of benefits to a company, including:

  • Business empowerment: Skilled employees can contribute to the growth and development of a company by suggesting new ideas and improving the quality of products or services.
  • Flexibility in resource management: Hiring allows a company to manage its workforce more flexibly, adapting to changes in demand and workload.
  • Increased trust from customers and partners: Companies with full-time employees are often perceived as more reliable and stable.

Conclusion

In Lithuania, a company may operate without employees if it does not contradict the specifics of its business and does not violate legal requirements. However, when deciding on the company’s structure and resources, it is important to take into account both the legislative aspects and the strategic goals of the business. In some cases, hiring qualified employees may be the key to the success and long-term development of a company in the Lithuanian market.

 How to choose a name for a company in Lithuania?

Choosing a company name is not only a branding issue, but also an important legal aspect that can significantly affect the success and legality of your business in Lithuania. Lithuanian legislation sets certain requirements and restrictions when choosing a company name, aimed at preventing confusion and ensuring clarity in the business environment. In this article, we present key recommendations for choosing a name for your company in Lithuania to ensure that it is recognisable and complies with legal requirements.

Explore uniqueness

The first and most important step is to make sure that the name you choose is unique. In Lithuania, you cannot register a company with a name that is already used by another company or is too similar to existing names. Using the Lithuanian Central Register of Legal Entities will allow you to check if the name you have chosen is already registered.

Relevance of the company’s activities

A good name reflects the scope of the company, making its offer clear to potential customers at a glance. However, avoid overly general or vague terms that can confuse consumers about what exactly your company does.

Consideration of linguistic aspects

When choosing a name, it is important to take into account the linguistic and cultural peculiarities of Lithuania. The name should be easy to pronounce and memorable for the Lithuanian population if the main sales market is directed to Lithuania. However, for internationally oriented companies, it is advisable to choose a name that will be easily understood in other languages as well.

Avoid restricted and banned words

Certain words and phrases may be restricted for use in company names without special authorisation. Such words typically include names that indicate government activity or control, such as “national”, “state”, and words that require a licence for certain activities, such as “bank”.

Check the availability of the domain name

In today’s world, having a website is an integral part of doing business. Therefore, it is advisable to check the availability of the appropriate domain name for your business name on the internet to ensure that your brand is consistent across online and offline spaces.

Consultation with professionals

When choosing a company name in Lithuania, it can be useful to consult legal advisors or branding specialists who can help you not only meet all legal requirements, but also create an attractive and memorable name for your business.

Conclusion

Choosing a company name in Lithuania requires a careful approach and consideration of many factors, from uniqueness and ease of pronunciation to compliance with legal requirements and availability of a domain name. The right name will not only simplify the process of company registration, but will also play a key role in creating a positive image and recognisability in the market.

 Business Register in Lithuania

The Lithuanian Business Register (Registrų centras) is a key element of the country’s legal infrastructure, providing comprehensive information on companies registered in the country. This register not only promotes transparency and accessibility of information on business entities for state authorities, investors and ordinary citizens, but also provides a legal basis for conducting business activities in Lithuania. In this article, we will look in detail at the functions, registration procedure and the importance of the Business Register for business activities in Lithuania.

Functions of the Business Register

The Business Register in Lithuania fulfils a number of important functions:

  • Company registration: This is a formal procedure that provides companies with a legal basis to begin operations.
  • Information storage: The register contains information on legal entities, including their name, registered office, information on directors and founders, as well as information on their financial status and history of changes.
  • Ensuring access to information: Information in the Business Register is available to the public, which promotes business transparency and enables checks to be carried out before concluding transactions or starting co-operation.

Registration process

In order to register a company in Lithuania, the following steps must be completed:

  1. Document preparation: The constituent documents of the company must be carefully prepared in accordance with the requirements of Lithuanian law.
  2. Submission of the application: Documents are submitted to the Lithuanian Legal Entities Registration Centre either online or directly at the registration office.
  3. Payment of the state duty: The amount of the fee depends on the form of the legal entity and the method of filing the documents.
  4. Obtaining the certificate of registration: After verification of the submitted documents, the company is officially registered and receives the certificate of registration.

Business value

The Business Register plays a key role in Lithuania’s economic environment:

  • Legal transparency: The Register provides visibility of legal structures and their activities, facilitating fair competition and preventing fraud.
  • Investor confidence: The availability of information on companies increases the confidence of investors and partners, as they can easily verify the financial status and legal cleanliness of potential partners.
  • Simplification of administrative procedures: The digitalisation of the Business Register and the possibility of online registration significantly simplify and speed up the process of starting and managing a business in Lithuania.

Conclusion

The Business Register in Lithuania is a fundamental tool for creating and maintaining a healthy business ecosystem. It not only simplifies the company registration procedure and provides access to important legal information, but also promotes the development of a transparent and open business environment. Understanding the principles of operation and opportunities offered by the Business Register is a key aspect of doing business successfully in Lithuania.

Viktoriia

“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.”

Viktoriia Korotkevich

LICENSING SERVICES MANAGER

email2[email protected]

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.

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.

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

Milana
Milana

“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.”

Sheyla

“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!”

Sheyla
Diana
Diana

“Hello, my name is Diana and I specialise in assisting clients in many questions. Contact me and I will be able to provide you efficient support in your request.”

Polina

“Hello, my name is Polina. I will be happy to provide you with the necessary information to launch your project in the chosen jurisdiction – contact me for more information!”

Polina

CONTACT US

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.

Company in Lithuania UAB

Registration number: 304377400
Anno: 30.08.2016
Phone: +370 661 75988
Email: [email protected]
Address: Lvovo g. 25 – 702, 7th floor, Vilnius,
09320, Lithuania

Company in Poland Sp. z o.o

Registration number: 38421992700000
Anno: 28.08.2019
Phone: +48 50 633 5087
Email: [email protected]
Address: Twarda 18, 15th floor, Warsaw, 00-824, Poland

Regulated United Europe OÜ

Registration number: 14153440–
Anno: 16.11.2016
Phone: +372 56 966 260
Email:  [email protected]
Address: Laeva 2, Tallinn, 10111, Estonia

Company in Czech Republic s.r.o.

Registration number: 08620563
Anno: 21.10.2019
Phone: +420 775 524 175
Email:  [email protected]
Address: Na Perštýně 342/1, Staré Město, 110 00 Prague

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