Incorporation documents package
Apostilled set of documents
Good offer Lithuania STANDARD
Republic of Lithuania (Lithuania) – is a country in Northern Europe (Baltic). Country is bordered by Belarus, Poland and the Kaliningrad region of Russia. Lithuania is the largest Baltic country, and is positioned as economic leader in the region. After restoration of independence in 1990, the country gained membership in UN, NATO, EU, is part of Schengen and euro-zone. Stability of economic situation, low inflation, loyal taxation policy and liberal legislation as a whole contributed to the growth of foreign investment in the country`s economy. Company in Lithuania is effective tool for tax planning, as there are quite low tax rates (corporate income tax is 15% that is the lowest one in Europe). In addition, possibility to use preferential tax treatment, presence of free economic zones and signed treatment on avoidance of double taxation make the country attractive for foreign business.
Company registration in Lithuania has a number of advantages:
- Image of the company, registered in respectable European jurisdiction;
- Favorable geographical position of the country, developed infrastructure;
- Low cost of company registration and its management;
- Highly qualified workers;
- Using along with Lithuanian, English and Russian languages for business communication;
- High level of banking system development;
- Possibility of resident permit, followed by citizenship.
Taxation in Lithuania is characterized not only by low tax rates, but also the possibility in some cases to reduce the amount of taxes to 0%. As already was mentioned, the size of standard corporate tax rate is 15%, but the company in Lithuania has the opportunity to apply a reduced rate of 5% under the following conditions:
- If the company`s income is less than 1 million litas (about 289 600 euros).
- Number of employees less than 10 people.
- None of the shareholders holds 50% share package.
Zero rate of income tax applies to businesses whose activities are not accompanied by a profit. Company in Lithuania, which belongs to the category of small and agricultural enterprises, may have tax exemption. It also includes non-profit organizations, companies with foreign investment, or those who provide jobs to people with reduced capabilities. Rather attractive is ability to open a company in Lithuania as holding, and this also directly connected with features of tax policy. With standard rate of tax on received dividends in 15% it is possible its reduction to 0%. This is possible if dividends are transferred by the subsidiary company, not having the status of offshore, the share ownership of its assets is 10%, and holding period is not less than 12 months. Observance of terms are not necessary if dividends are received from EU country.
Zero withholding tax rate on dividends applies with fulfilment of above-listed conditions, but in relation to parent company, which paid dividends. Withholding tax within payment of interest and royalties can be reduced to 1% and 2%, respectively, if those transferred to EU and if the interest is transferred to a country with which is signed the agreement on avoidance of double taxation. The VAT rate is 21%, but can be reduced to 9% or 5% depending on the form of activity.
One can open a company in Lithuania in the form of closed Joint Stock Company with limited liability, UAB (the most popular variant) or open Joint Stock Company with limited liability, AB. The authorized capital for UAB is at least 10 000 and for AB - 150 000 litas.
Opening the company in Lithuania requires minimum one shareholder (max 250 people) - private or legal persons, and at least one director, who will be private person. There are no requirements for directors and shareholders residency. It is impossible to combine director and shareholder functions. For company registered in Lithuania, it is necessary to submit financial statements and balance. One also should to submit quarterly reports to the Pension Fund on the basis of paid salary. Audit is necessary for open stock companies.
There is also possibility to buy a company in Lithuania. The purchase process takes one day and the process of reissuance occurs within a week.
Enter your details in the form
We will not share your email address with third parties, you can always unsubscribe in your account, either straight from poluchennogo letters from us. With respect it-offshore corp.