What You Need to Know About Offshore Company Formation in Lithuania
FormationWise can help investors, entrepreneurs and businesses set up a company in Latvia hassle-free!
Why Lithuania
There are many key benefits that attract investors and entrepreneurs to offshore company formation in Lithuania. As the largest of the Baltic states, Lithuania enjoys an advantageous economic situation that makes it an ideal jurisdiction for company formation. The region’s stable economy, business-friendly environment, low inflation and low labour costs are all key factors that make company formation in Lithuania attractive. The country’s status as a member state of the European Union adds a level of prestige that is attractive to business owners. Beyond this, its corporation tax rate is one of the lowest in the EU.
Why FormationWise
With these points in mind, today is the perfect time to reach out to our financial experts at FormationWise. We have the knowledge and experience required to help you through each step of the process for successful company formation in Lithuania. Our global partners have a deep understanding of the intricacies of this jurisdiction. Working with us is a proven way to ensure that everything is in order when you submit your documentation to open a company in Lithuania.
What we do
Our experienced team can support you through the entire journey of opening a business. Accounting services, advisory and consultation, assistance with taxation or building your website – we’ve got it all!
Why you need us
Starting an offshore business is not an easy task to bear on your own. Venturing into new territory, legislation, customs and requirements can be both exciting and quite overwhelming. Teaming up with FormationWise will guarantee smooth sailing from beginning to end! We are here for you!
Steps for making an order
- 1
Select your desired package
Simply choose the right package for your needs by filling out our form, by call or by placing an order on our website.
- 2
Make a payment
After finalizing the correct package make the payment for your selected services and send us your documents.
- 3
Send your documents
Forward us all the necessary documents through an email with documents attached or by phone
- 4
Company formation
Once we receive the payment and the required documents, we will start the company incorporation process in Lithuania
- 5
Open a bank account
We will help you open a corporate or personal account with a reputable bank in Lithuania
Types of companies that can be registered in Lithuania
Before you can start engaging in business activities in Lithuania, a decision must be made on the type of legal entity that will be the most suitable vehicle for your investment plans. The options for company formation in Lithuania include:
Public Limited Liability Companies (AB)
The public limited liability company is the most common option used by medium and large companies that operate within Lithuania. Founders of public limited liability companies can be residents or non-residents of Lithuania. Its shareholders have limited liability and are liable for the company's obligations to the extent of its total property. Founders and shareholders are not liable for the obligations of a public limited liability company and the company is not responsible for their obligations.
Private Limited Liability Companies (UAB)
Private limited liability companies are the most common vehicle for smaller foreign investors to form a private company within Lithuania. There is a requirement of one or more founders. Founders can also be shareholders with private limited liability companies in Lithuania. The company founder does not have to be a resident of the country. Both the company and its shareholders have limited liability. The undertaking of a shareholder is limited to their amount of capital invested. The management of the company is determined during a general shareholders meeting. It is also important to note that there is no requirement for a supervisory council. Private limited liability companies in Lithuania cannot have more than 250 shareholders.
General Partnerships (TUB)
General partnerships are another type of business opportunity that you can consider in Lithuania. There is unlimited liability with general partnerships. There must be an agreement between the partners. This must be signed and notarized by all of them.
Limited Partnerships (KUB)
The other type of partnership opportunity in Lithuania is the limited partnership. Like with a general partnership, there must be an agreement between all partners that is signed and notarized. Limited partners are liable to the extent of their contribution to the company.
Branch/Representative Offices
Lithuanian law allows for foreign organisations and companies to establish representative offices in the country as well as the establishment of branches. These entities are part of a foreign organisation/company that operates within the territory of the Republic of Lithuania. There is a requirement for at least one manager of the company to reside in Lithuania. A key feature of these businesses is the fact that a foreign company is responsible for all liabilities. A foreign company can set up a permanent establishment in Lithuania for tax purposes.
Minimum share capital
There is a minimum share capital of €44,000 for a public limited liability company that is incorporated in Lithuania. 25 per cent of this amount has to be paid up at the time of the registration of the public company. For a private limited company that is incorporated in Lithuania, there is a minimum share capital of €2,900.
Time frame for the incorporation
The timeframe for the incorporation of a company in Lithuania is two weeks. It can take up to four weeks for corporate bank account approval and up to three weeks for approval of internet banking. Engagement completion generally takes one week.
Do you provide a registered office address or a virtual office?
Yes
Is bookkeeping or an annual return required?
Yes
Foreign ownership allowed?
Yes
Our Services
Reasons to form a company in Lithuania
There is an outstanding list of benefits that come along with forming a company in Lithuania. Notable benefits include:
- The tax rate is between 5 and 15 per cent
- There is double taxation protection in Lithuania
- Annual operating costs in Lithuania are minimal
- You get the opportunity to operate a business in the EU and enjoy the associated prestige
- There is a minimum number of tax audits
- There is the possibility of receiving a VAT refund
- Lithuania has a stable economy
This list of benefits helps to demonstrate why it is a great move to launch a company in Lithuania. Its business-friendly environment has been set up to encourage entrepreneurship and investment. This includes encouraging foreign ownership of companies within the jurisdiction. To learn more about the benefits you can enjoy when you start a company in Lithuania, you can contact our team of company formation professionals at FormationWise. We will be happy to discuss these matters with you during your consultation. Our goal is to assist you throughout the company formation process so you can start to enjoy all of these great benefits that we have listed here.
Why choose FormationWise to set up an offshore company in Lithuania
Choosing the FormationWise team is the proven way to efficiently and effectively set up an offshore company in Lithuania. Our team of experienced professionals have years of experience working in global jurisdictions like Lithuania. The team is made up of a network of global partners who are committed to providing you with the best services available in the realm of company formation. A few of the key reasons why you can count on us as your go-to service provider for setting up your company in Lithuania include:
We Offer a Comprehensive Range of Professional Company Formation Services for Lithuania
Our team at FormationWise offers a comprehensive range of company formation services designed to get you up and running in amazing jurisdictions such as Lithuania. The services that our team provides include document retrieval, private client services, taxation services, trademark registration, and many more. These professional services are delivered by a dedicated network of global partners who are highly qualified and experienced.
Our Informational Consultation Is Offered Free of Charge
At FormationWise, we offer you a preliminary consultation for company formation services that is provided free of charge. During this consultation service, we will cover the various company formation strategies that can be employed as well as discussing matters such as the provision of services that you will need to meet the specific goals that you have in Lithuania.
We Have an Outstanding Reputation for Providing Secure Services
At FormationWise, we take the safety and security of our clients seriously at all times. When you choose our company formation services, you can count on the fact that all of your vital financial and personal data will be protected.
You Can Count on Service That Is Fast and Reliable While Also Being Cost-Effecitve
Our team is committed to providing you with company formation services that are fast and reliable. We are also committed to delivering these services at a cost that is competetive within the standards of the industry. Offering cost-effective solutions is something that we take a lot of pride in here at FormationWise. When you choose our team, you can count on us working to get you going with your company in Lithuania as quickly as possible. All of our pricing is completely transparent so you never need to worry about running into hidden fees when you choose our team of company formation professionals.
Legal requirements
The legal requirements for the registration of a private company in Lithuania are as follows:
- Act of Incorporation or Incorporation Agreement
- The Article of Association for the company being formed
- The minutes for the company's founding meeting
- Confirmation that a Lithuanian bank account has been opened
The legal requirements for opening a public limited company in Lithuania include:
- The Act of Incorporation or the Incorporation Agreement
- The Articles of Association for the company
- The founding meeting's minutes
- Confirmation that a Lithuanian bank account has been opened
- A company report that includes the opinion of an auditor
- Confirmation of share registration (with the Securities Commission)
To learn more about the specific legal requirements for company formation in Lithuania, you can reach out to our professionals at FormationWise. We will be happy to offer you an informational consultation designed to provide you with all the information you need to know to open your company within the jurisdiction.
Documents required for registration
Working with our team of financial professionals at FormationWise is a proven way to ensure that all of our necessary documentation is in order as you work toward opening a company in Lithuania. Let’s look at the documents we would need to prepare:
- Notarized copy of your passport
- Proof of residency
- Proof of income for the company's individual director and shareholder
- CV of the company director
- Articles of association
- Act of incorporation or incorporation agreement
- Minutes of the founding meeting
- Confirmation that you have a Lithuanian bank account for the business
- For PLC: confirmation of share registration through the Securities Commission
- For PLC: auditor's opinion
- For PLC: company report
What is the process?
The steps involved with company formation in Lithuania include:
Company Name Selection
When selecting a name for your Lithuanian company, it is important to be original and to choose an option that is not the same or similar to another company currently operating in the jurisdiction. It is also important to choose a name that will avoid being deemed as controversial. Business names can be reserved with the Register of Legal Entities for a six-month period. Form JAR-5 is the required document you must fill out to register a company name.
Prepare Constituent Documents
If there is one company founder, a constituent act is required. In the case of two founders, a constituent agreement is needed instead. Small businesses in Lithuania can have no more than 10 founders. The required documents must state the company name, the founders of the business, the main office, the business head and the contribution of each member to the business.
Company Charter
The company charter is the third key step in the process of company formation in Lithuania. It is the business's main document on the basis that the company conducts its activities. Charters have to specify the business's name and legal form. The purposes of the business's activities must also be stated as well as the rules for the appointment and dismissal of the business head. The charter also has to include the rules for holding meetings of members.
Notarization of Required Documents
All prepared documents that are submitted for company formation in Lithuania must be notarized. The notary will confirm the charter. They will also check if the documents correspond to legal acts.
Registering with the Lithuanian Register of Legal Entities
The next step in the process of company formation is registering with the Register of Legal Entities in Lithuania. This process usually takes just three days to be completed. When a company is registered, a certificate of registration is issued by the Register of Legal Entities. It also issues one copy of the company charter that has been confirmed.
Register with the Social Security Fund
Companies registered in Lithuania must also be registered with the Social Security Fund.
Register With the Tax Office
Registering with the tax office is the final step in the process of company formation in Lithuania.
Cost of company formation in Lithuania
The setup cost for the first year of an LLC in Lithuania is €4,275. The average total cost for setting up a company in Lithuania comes to €10,925. This figure includes the cost of company incorporation, the opening of a corporate bank account, the costs associated with a legal registered office and all required government registration fees.
For a PLC, these average costs come to €11,950. Average costs associated with opening a branch of a foreign company come in at €11,600 while there is an average cost of €11,100 for the registration of a representative office.
Our financial professionals here at FormationWise will be happy to discuss the costs associated with company formation in Lithuania when you schedule your informational consultation with us. Our goal is to make sure that you are clear about what to expect when it comes to the cost of company formation in this exciting EU jurisdiction.
FAQ
Lithuania’s business environment is a friendly one that encourages entrepreneurship and investment. The government has gone to great effort in recent years to move the country up in the international rankings for the top jurisdictions to do business in. There is a significant emphasis on supporting small and medium-sized businesses with a focus on innovation. The government’s Lithuanian Innovation Strategy 2010-2020 was set up to encourage increased income growth and competitiveness in the market. Lithuania ranks as one of the easiest countries in the world to set up a business. This includes significant ease when it comes to property registration.
Private limited liability companies that are formed in Lithuania only require one director and one shareholder. There is a minimum of one director and a minimum of one shareholder for public limited liability companies that are formed in Lithuania. These minimal requirements for company formation in Lithuania add further to its status as a highly desirable jurisdiction for entrepreneurs and investors to become involved in.
As we have noted, the process of setting up a company in Lithuania is quite straightforward and uncomplicated. There is no requirement for a company secretary when forming a company in Lithuania. Limited liability companies simply require one director and one shareholder. There is also a requirement of at least one director and at least one shareholder to incorporate a public limited company.
It is required to have a registered local address in Lithuania if you wish to open a company within the jurisdiction. Assistance in this regard is another area of focus for our team of professionals here at FormationWise. We offer registered office solutions that will ensure that you are able to meet this requirement for company formation in Lithuania. This is a topic we would be happy to discuss further with you when you schedule your informational consultation with us.
The Register of Legal Entities is the department of the Lithuanian government that is responsible for the registration of businesses and institutions. It is also responsible for the registration of NGOs. The register collects an extensive, detailed amount of data regarding legal entities operating within the Lithuanian jurisdiction. The collection of data on branches and representative offices of foreign-owned organizations and companies is another key point of focus for the Register of Legal Entities in Lithuania.
Company names for businesses being formed in Lithuania should utilise Lithuanian grammar rules. It is permitted to use Latin words in a company name. It is also possible to use a foreign name in the case that you have a registered trademark or permission from a registered trademark owner. Company names must be registered with the tax office in Lithuania.
The standard corporate tax rate in Lithuania is 15 per cent. As of July 2022, a new Law on CIT went into effect. It is designed to apply a 20 per cent tax rate on the taxable profits of credit institutions. Small companies and businesses in the agricultural sector can apply for a reduced CIT rate that can range from zero to five per cent. This is dependent on specific conditions being met. Our company formation professionals will be happy to further discuss taxation in Lithuania when you take advantage of your informational consultation.
There are no restrictions for foreign ownership of Lithuanian companies. Foreign owners enjoy the same rights as Lithuanian nationals and residents. There is also no requirement to visit the country. This factor adds to the overall ease that Lithuania is known for regarding how simple it is to get up and running with your business.
You must have a bank account in Lithuania to open up a company. You can expect the standard range of banking facilities available in Lithuania. This includes options for international payments and foreign exchange. Assisting you with the specifics and logistics of opening a bank account in Lithuania is another thing that our FormationWise team can assist you with as you go through the process of starting a company in the jurisdiction. We know the ins and outs of what it takes to get going with your banking needs in the country.
One of the many factors that make Lithuania a convenient country to do business in is the fact that there is no need to be physically present during the incorporation process. The company registration process for Lithuanian businesses can be done remotely. Our company formation experts at FormationWise can help you to go through the registration process online. You can count on our professionals to assist you in navigating all of the necessary steps. It is one of the convenient aspects of engaging in investment and entrepreneurship in this exciting jurisdiction.