Accountancy in Luxembourg

If you have a company in Luxembourg, then you need to prepare annual financial statements on the activities of the company. Financial reporting, management report, and auditor’s report – we are ready to provide you with all these services for your business.

Type of Luxembourg company structures that is subject to bookkeeping:

Public Limited Company (Société Anonyme - SA)

The SA is often the legal form of business chosen by large enterprises, but it is also used, as the shares in this type of company can be bearer shares and are therefore more easily transferable.

Private Limited Liability Company (Société à responsabilité limitée - SARL)

A Private Limited Liability Company is one of the most common company types in Luxembourg.

Simplified limited liability company (Société à responsabilité limitée simplifiée - SARL-S)

The key facet of the Simplified company is that, for founders, it reduces the burden of some requirements for registering a SARL.

All company types in Luxembourg must:

Bookkeeping for business

Our company provides consultations and highly qualified accounting services, on issues of legislation and taxation. Our company offers full accounting support in Luxembourg.

Accounting Cycle

The accounting cycle is a collective process of identifying, analyzing, and recording the accounting events of a company in Luxembourg. 8 stages of the Accounting Cycle:

Stage 1: Transaction identification

The accounting cycle begins with the identification of various transactions, for example, sales, returns, etc. (transcription identification).

Stage 2: Logging transactions

The next step is to write it down in the journal. Writes down the account number and various accounting transactions.

Stage 3: Posting

After writing the data to the journal, the accountant enters it into the general ledger.

Stage 4: Unadjusted Trial Balance

After the firm posts journal entries to individual general ledger accounts, an unadjusted trial balance is prepared. The trial balance ensures that total debits equal the total credits in the financial records.

Stage 5: Worksheet

The 5th step in cycling – analyzing a worksheet and identifying adjusting entries. A worksheet needs a company to make sure that debits and credits are equal. If there are discrepancies then adjustments will need to be made.

Stage 6: Adjusting Journal Entries

At the end of the period, the company should make the adjusting entries. These are the result of corrections made on the worksheet and the results from the passage of time.

Stage 6: Financial Statements

After the posting of adjusting entries, a company prepares an adjusted trial balance according to the actual formalized financial statements.

Stage 7: Closing the Books

Finally, An entity temporarily accounts, revenues, and expenses, at the end of the time using closing entries. These closing entries include transferring net income into retained earnings, a company prepares the post-closing trial balance to ensure debits and credits match and the cycle can start again.

Financial reports

Companies operating in Luxembourg are required by law to file annual financial statements.
The filing of financial statements in Luxembourg is regulated by the Companies Act, the Accounting Act, and other regulations.
Luxembourg companies, whose shares are traded on the stock exchange, use International Financial Reporting Standards, but small and medium-sized businesses use national standards.
The annual financial statements are submitted in Luxembourg to the Commercial Register (RCS).
The maximum deadline for submitting reports is seven months after the end of the reporting financial year. Within six months, a meeting of shareholders (owners) must be held, approving the annual report, after which a month is given to submit the report to the register.

Financial statements submitters

All businesses has to submit different types of financial statements depending on size of enterprise. Down below you can see legal entities that has to submit financial statements.

Small-sized enterprises

The small category includes enterprises with a balance sheet of up to 4.4 million euros, a turnover of up to 8.8 million euros, and an average number of employees up to 50 and should serve these statements:

Medium-sized enterprises

Enterprises with a balance sheet of up to 20 million euros, a turnover of up to 40 million euros, and an average number of employees of up to 250 fall into the medium-sized category and should serve these statements:

Large-sized enterprises

Enterprises with a balance sheet of over 40 million euros, and an average number of employees is over 250 fall into the large-sized category and should serve these statements:

Accounting solution

Contact us to get accounting solution for you company in Luxembourg.

Registering for VAT

VAT (Value Added Tax) is a levy on transactions related to economic activity paid by enterprises. The enterprises give this to customers in the form of price increases.

According to the EU VAT Directive, foreign companies that do business must register a VAT number (under certain circumstances). To declare VAT, the tax must be levied.

If a foreign company is not registered in Luxembourg but is engaged in the supply of goods or services to Luxembourg, then the company must obtain registration of a non-resident VAT payer.

You need to obtain VAT in Luxembourg If you:

Preliminary VAT registration documents

You need to open a bank account (postal checking account), before the registration of VAT. To obtain a number, you must provide the following documents and information:

You will also need the constituent documents of your company, documents confirming the legal address and appointment of the director, passport details of the director, and a signed application for obtaining a VAT number.

To assign a VAT number, the company must conduct business in this country, and the residence of the company does not matter.

VAT registration deadline

The deadline for registering a VAT number in Luxembourg is within 15 days from the start of business for taxpayers who are not exempt from registration until the first day of the month following the month when the tax exemption limit is exceeded (within the same calendar year). The Luxembourg VAT number consists of the letters “LU” and eight unique numbers.

Register as a VAT payer

To register as a VAT payer in Luxembourg, a person must submit an initial return or an alternative return to the tax office of the state. It can be submitted online at MyGuichet.lu or by mail.

Taxes in Luxembourg

One of the reasons why Luxembourg is a great choice for business formation is a low tax rate which is one of the lowest in all of Europe – only about 27%. Learn taxes and get most of the Luxembourgish company.

Corporate income tax

One of the main taxes that business entities are required to pay is on the profits of legal entities. Resident enterprises are required to pay a fee to the budget on all profits from their entrepreneurial activities.

Withholding tax

Payable when distributing dividends. The base rate of this tax is 15 percent.

Value added tax

VAT is a mandatory indirect consumption tax. The only exceptions are certain goods and services that have a preferential settlement regime. The standard rate is 15%. 

Learn about taxes

Learn about taxation and tax rate in Luxembourg jurisdiction.

Consultation about accountancy

The specialists of our company will be happy to help you with bookkeeping in Luxembourg. We provide a comprehensive, quality service for you, and all types of audit services including, financial reporting, management report, and auditor’s report, as well as give a consultation.

Maintenance of financial accounting and reporting

Our company takes care of all the issues related to accounting, from the processing of primary documentation to the provision of all necessary reports to the regulatory authorities.

Support for statutory or internal audit

We provide statutory and internal audit service to any organization is one of the important aspects of business activity.

Preparation of annual reports

Every year the company must submit an annual report about their activities with or without profit. Our company provides accounting services for enterprises in Luxembourg, which operate in various fields of activity.

Drawing up permanent reports on accounting documents

All organizations in Luxembourg are required to prepare financial statements based on synthetic and analytical accounting data. The financial statements are signed by the head and the chief accountant (accountant) of the organization. By law, tax reports are submitted to the regulatory authorities on a monthly or quarterly basis.

Management of company accounts

Management accounting is one of the key factors when discussing business programs, plans, and goals in large organizations. Management accounts are usually built from multiple income statements of the firm. Management reports are usually prepared monthly or quarterly.

HR payroll management

The goal of HR payroll management is to simplify HR management processes and save your time. Payroll and tax calculations are also included in the package.

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