Registering a company in Lithuania from 399€ + VAT.
What do I need to know before opening a company in Lithuania?
Why start a business in Lithuania?
Moreover, the countries business index ranks among the top 15 for such areas as: 3rd lowest profit taxes, 11th for ease of business. During the last few years Lithuania has shown great promise and has rapidly grown to become a fintech centre for a lot of high-valued corporations. As of, 2020 FinTech startups have continiuously chosen Lithuania and currently there are over 4,000 people employed as well as over 230 Fintech type companies.
Lithuania has also not shied away from attracting new entrepreneurs and investors. The country has made continious strides in attracting new business (which in large is thanks to the flourishing service and data centres). It is also worth mentioning that Lithuania has successfully attracted such giants as Google, Thermo Fished, Revolut, Uber and others. Lithuania is also home to a quite a few successful companies, such as Trafi, Tesonet and the highly popular Vinted.
Lithuania is a destination as it is considered a bridge between East and West.
A large percentage of the population speaks 1-2 foreign languages (English being the main one, with Russian a close second), this makes it easier for foreigners to communicate. Lastly, the internet in Lithuania is currently one of the best in the world due to its reliability, cheapness and accessibility for all matters (business to personal). A nation that continues to grow and move forward is a perfect place to stop and start your new venture.
At present, different types of business forms can be established in Lithuania:
– Closed joint stock company (UAB)
UAB is the most popular company form of business type in Lithuania nowadays. For non-Lithuanian citizens/residents, registering a UAB company has to be finalized with the assistance of a notary and usually takes approximately 2-6 weeks from the date all documents are collected. Please bear in mind, that purchasing a ready-made company requires a visit and is not possible at this current time to complete it remotely. It is also worth noting, that the founder(s) must have 2500EUR of funds available for a share capital.
We will, of course, assist you along the way, preparation of relevant documentation, arranging necessary meetings with the notary and filing all required details with the Registry Centre. All that is required from you is a name that you wish to use and we will take care of the rest.
The minimum investment is €2500.
Requires a registration address in Lithuania.
The company must have a bookkeeper who keeps the accounting records.
To set up a company without a notary, you need to have a mobile signature.
– Small partnership (MB)
MB (in Lithuania called Mažoji Bendrija) is a very popular form of business in Lithuania. For non-Lithuanian citizens/residents, registration of an MB has to be finalized with the assistance of a notary and usually takes approximately 2-6 weeks from the date all documents are collected. Please note, that registration of this type of company will require eithe ra visit or a Power of Attorney for remote incorporation. As opposed to its UAB counterpart, an MB does not have a minimum share capital requirement. Registration process is the same as a UAB – a notary is required for registration (can be done remotely or in person).
With regards to the differences, it is worth mentioning that MB was created in 2012 and its purpose was to introduce an easier way of doing business following a financial crisis. MB is here to encourage new entrepreneurs into creating small to medium-sized businesses in Lithuania. It is the perfect choice for, as previously mentioned, small to medium-sized companies or for additional activities if an individual is permanently employed somewhere else.
Requires a registration address in Lithuania.
What are main differences between UAB and MB?
up to 10
up to 250
Setting up a company in Lithuania involves several types of taxes:
The current VAT rate in Lithuania remains at 21% and requires registering for a VAT number if turnover exceeds 45000€ during 12 months of business.
Dividends are currently taxed at 15%.
Personal income tax (GPM) is 20%.
The standard income tax rate is 15%, but many small partnerships apply a reduced rate of 5%. The 5% corporate tax rate may apply if: the average number of employees does not exceed 10 people, annual revenue does not exceed 300 000€ and the members of the small partnership do not hold more than 50% of the shares or stakes in other companies. Neither an MB nor a UAB has to pay income tax for the first calendar year after the company’s incorporation.
Most frequently asked questions
We, as the founders of the company, do not have the possibility to register the company we are selling for VAT on ourselves, so all this is done after the acquisition. Registering the company for VAT is easy and free of charge for all accountants.
By the way, we also provide accountancy services and our accountants register companies for VAT free of charge.
If you need any help, please do not hesitate to contact us, we will be happy to help.
Foreigners can open bank accounts in Lithuanian banks only by electronic companies establishment. If the clients buys established UAB from us, the company is sold with an already opened bank account at Luminor bank. If you set up a company by notary, you can try to open a bank account yourself, but again, there is no guarantee that the banks will open the account.
If you have any questions, you can always contact us by phone or by e-mail.
Yes, we can manage your company's accounts and do other work that benefits your business:
- We keep complete company accounts from the initial documents to the preparation of financial statements;
- Payroll and other personnel accounting;
- We mediate with government institutions;
- We submit the necessary declarations and reports for you to the Internal Revenue Service, the Social Insurance Institution, the Centre of Registers and other state institutions;
- We prepare company authorisations (both written and electronic) and orders necessary for bookkeeping;
- Cleaning up neglected bookkeeping;
- Advising on accounting, tax, financial and legal matters;
- Process legal documents;
- Preparation of contracts and other legal documents;
- Advise on debt recovery and management issues and prepare the necessary documentation;
We specialise not only in accounting, but also in legal services, so we can help your company's accounting and financial management by assessing the relevant operations or actions from both an accounting and a legal perspective.
Contact us for a tailored accounting service proposal for your company.
Indicative accounting prices:
Accounting for LLCs, MBs and other companies from EUR 110/month + VAT.
Our accountants communicate in English, Russian, Estonian and Lithuanian.
We have our own registration address and provide it free of charge in Kaunas for the first year. Later registration address costs 99€ per year. However, we can offer you a partner address abroad for a friendly cost. The price varies individually depending on the country and partner offers.
LCPC aims to provide you and your business with high quality assistance. Setting up a company is one of the first steps in building your business and we will help you through it together!
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