Dreaming of running your own business in the heart of Europe? Luxembourg may be the place to make it happen. With its strategic location, robust economy, and international outlook, it’s no wonder so many expats are choosing to start their ventures here.
In this guide, we’ll walk you through the key steps, legal essentials, and practical insights every foreign entrepreneur needs to know before launching a business in Luxembourg.
Why Choose Luxembourg?
Small in size but mighty in opportunity, Luxembourg boasts the highest GDP per capita in the world, a strong financial sector, and business-friendly policies. The country offers political stability, low corporate tax rates, and access to the EU’s single market — all of which make it a prime destination for startups and international founders alike.
From tech to consulting, e-commerce to construction, a wide range of industries flourish here. Luxembourg is also home to a highly skilled, multilingual workforce and over 70% of its labour force consists of foreign nationals and cross-border workers — making it one of Europe’s most diverse business ecosystems.
Can Foreigners Start a Business in Luxembourg?
Yes. Both EU and non-EU citizens can legally establish a company in Luxembourg. However, non-EU nationals will need to go through extra steps, including obtaining a residence permit and business licence.
Here’s a breakdown based on nationality:
- EU/EFTA Citizens (including Iceland, Norway, Liechtenstein, Switzerland): You don’t need a visa or residence permit to start a business. You only need to register your arrival if staying longer than 90 days.
- Non-EU Citizens: You must apply for a residence permit as a self-employed worker before launching your business. This involves submitting an application to the Immigration Directorate and proving your qualifications, clean criminal record, financial resources, and business intent.
Step-by-Step: How to Open a Business in Luxembourg as a Foreigner
1. Choose the Right Legal Structure
Luxembourg offers various business structures. The most common for small businesses and startups are:
- Sole Proprietorship (Entreprise individuelle) – Simple setup, full personal liability.
- SARL (Private Limited Company) – Popular choice, limited liability, minimum €12,000 share capital.
- SARL-S (Simplified SARL) – Easier setup, only €1 required as starting capital, perfect for solo founders.
Other forms include general partnerships, public limited companies (SA), and cooperatives. The right structure depends on your business model, risk tolerance, and whether you plan to hire staff or raise capital.
2. Secure a Business Permit (Autorisation d’établissement)
Most activities — whether commercial, skilled craft, or liberal profession — require a business permit. To apply, you’ll need to:
- Show proof of residence in Luxembourg
- Demonstrate professional qualifications or experience
- Have a clean criminal record
- Provide a fixed business address
Applications are submitted online via the MyGuichet.lu portal. Permit fees typically cost €50, and approval can take up to 3 months.
3. Register Your Business
All businesses must be listed in the Trade and Companies Register (RCS). Depending on your legal form, you may need to:
- Draft and notarise articles of association (SARL/SARL-S/SA)
- Deposit share capital in a Luxembourg bank
- Register your business name with the Luxembourg Business Registers (LBR)
4. Sort Out Taxes and Social Security
Businesses must register with:
- The Luxembourg Inland Revenue (ACD) for income or corporate tax
- VAT authorities, if turnover exceeds €35,000
- Social Security (CCSS), especially if you’re self-employed or plan to hire employees
Even sole traders must contribute to state pension, health, and unemployment insurance schemes.
Starting a Business Online
Luxembourg is open to digital entrepreneurs. You can run a fully online business with the same registration and compliance processes. Make sure to secure a domain, build a GDPR-compliant site, and follow Luxembourg’s e-commerce regulations.
Need Help?
Setting up a company in a new country can be daunting. Luckily, platforms like EasyBiz make the process simpler. From choosing the right business form to handling paperwork and timelines, they offer guided services — sometimes launching a SARL in as little as five working days.
Final Thoughts
Starting a business in Luxembourg as a foreigner is not only possible — it’s increasingly common. With the right preparation, legal support, and understanding of the system, you can establish a thriving company in one of Europe’s most dynamic economies.
Whether you’re dreaming of a tech startup, consultancy, or artisan brand, Luxembourg gives you the foundation to go global — right from the centre of Europe.
David Prior
David Prior is the editor of Today News, responsible for the overall editorial strategy. He is an NCTJ-qualified journalist with over 20 years’ experience, and is also editor of the award-winning hyperlocal news title Altrincham Today. His LinkedIn profile is here.