ServicesUpdated on Tuesday 03rd May 2022
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Our specialists in Luxembourg provide a wide range of financial services for local and foreign individuals and companies interested in setting up investment funds and other types of businesses in this country. Below, investors can find the extensive list of the main services offered to our clients.
Wealth management in Luxembourg
This service is specially designed for international businessmen handling complex businesses in many countries and operating with large amounts of money. In order to manage their wealth, they can set up a SPF (société de participations financières), also known as a wealth management company, and benefit from a special taxation regime. Our financial specialists may also help you with wealth planning and opening two types of entities related to this objective: SOPARFI and SPF.
Asset protection in Luxembourg
Luxembourg offers important means for asset protection as it is one of the most important financial hubs in Europe. The individuals and companies interested in asset protection should know they can benefit from the favorable taxation system and the financial solutions offered by our local specialists. They will help you invest your assets in order to grow your revenue on a medium and long term.
Open SPF in Luxembourg
Foreign investors can open a SPF (société de participations financières) in Luxembourg in order to manage their wealth, but they are not allowed to perform any commercial activity through this type of entity. They can only buy, sell, hold or manage different types of financial assets and will benefit from exemptions from paying the corporate tax, the municipal business tax and the net wealth tax. The owner of a SPF must pay an annual tax of 0.25% on the amount of the paid-up capital and the share premiums. When opening a Luxembourg fund through a SPF, the following will apply:
- the SPF in Luxembourg can be formed as a limited liability company, a public limited company or a limited partnership by shares;
- if the SPF takes the form of a limited liability company, its minimum share capital must be of EUR 12,000;
- in the case of the other two business forms, the minimum share capital is established at EUR 30,000;
- the SPF in Luxembourg can have its share capital deposited in any type of currency;
- it is also necessary to know that this structure is exempted from the payment of the value added tax.
Establish SIF in Luxembourg
The specialized investment fund (SIF) in Luxembourg can hold different types of assets, such as: hedge funds, real estate, bonds, securities etc. This type of entity is a flexible one that offers a very good taxation regime for investors. The SIF can be incorporated as a common fund known as FCP (fonds commun de placement) or investment company (SICAV or SICAF).
This type of fund must be managed by another entity because it doesn’t have legal personality. The shareholders of a SIF must have a minimum capital share of EUR 1,250,000. The annual subscription tax for this type of fund is 0.01% of the net asset value. Some of the advantages of the SIF in Luxembourg are presented below:
- the SIF in Luxembourg can invest in all types and classes of assets;
- it is addressed to well-informed investors, which refer to institutional investors or professional investors;
- however, this type of fund is also available for investors who do not fall into the above mentioned category;
- for example, an eligible investor of a SIF in Luxembourg can be a person who can invest a minimum sum of EUR 125,000;
- the investor of a local SIF can also be an entity that was approved by a banking institution.
Open a SICAR in Luxembourg
Our team of financial specialists may also assist in opening a SICAR in Luxembourg - in French, known as société d'investissement en capital à risqué; this type of entity defines an investment company in risk capital. This type of company is suitable for private equity and venture capital investment and it can act as an umbrella company, holding many sub-funds. The shares of a SICAR can be listed on the Stock Exchange under certain conditions. For more details, you may address to our specialists in Luxembourg. However, investors must consider that the SICAR in Luxembourg has the following tax advantages:
- the distributions of dividends of a SICAR in Luxembourg are not imposed with the withholding tax;
- in the case of an income obtained from transferable securities, the corporate income tax will not apply;
- however, other types of income obtained by this investment structure can be imposed with a corporate tax of 28,59%;
- the SICAR can also be exempted from the payment of the value added tax;
- this is the case of the management services received by a local SICAR;
- this type of structure is exempted from the payment of the subscription tax and of the wealth tax.
Set up SICAV in Luxembourg
The SICAV (Société d’Investissement à Capital Variable) is used as an investment company with variable capital and it is a type of UCI (Luxembourg investment fund). Each of its sub-funds must have a different investment policy and the minimum capital share for opening a SICAV is EUR 1,250,000. The activity of every SICAV is monitored by CSSF (Commission du Surveillance du Secteur Financier).
Establish SICAF in Luxembourg
The SICAF in Luxembourg is also known as the investment company with fixed capital and it can be used in order to open an undertaking for collective investments in this country. The minimum capital share required is EUR 1,250,000 and this amount must be deposited within six months from the incorporation. After opening this type of fund, you will need the approval of the supervisory authority CSSF. The investors who choose to open a SICAF can benefit from tax exemptions, such as for income tax, net wealth tax and VAT.
What are the common traits of SICAVs and SICAFs in Luxembourg?
Setting up UCI and UCITS in Luxembourg
In Luxembourg, you have the possibility to set up a UCI (undertaking for collective investment), that is a type of investment fund opened in order to obtain income from multiple investments, and UCITS (undertakings for collective investment in transferable shares) – special funds for investing different types of liquid financial assets.
Why open an investment fund in Luxembourg?
- the banking sector in Luxembourg had a net profit of EUR 4,819 million at the level of 2016;
- equity funds in Luxembourg held assets with a total value of EUR 1.1 billion (third quarter of 2016);
- in 2017, there were 300 insurance companies operating in Luxembourg;
- the assets under management of the local insurance companies accounted for EUR 182,904 million (in 2015);
- the country is a reputable international financial center, having more than 140 foreign banks operating on its market;
- money market funds had assets with a value of EUR 291,760 million (last quarter of 2017).
Private equity in Luxembourg
If you are interested in private equity in Luxembourg, our financial specialists will offer you professional advice about the regulated (SICAR and SIF) and non-regulated (SOPARFI) types of structures you may open. Our financial representatives can advise on the main advantages of opening a Luxembourg fund under one of these structures.
Company formation in Luxembourg
Our agents in Luxembourg also help foreign investors open different types of companies available in this country, such as: the joint stock company (SA), the limited liability company (SARL), the partnership (SNC), the limited partnership (SCS or SCA) or the cooperative company (SC) etc.
For details about our services, you may contact our local office, where you can receive the necessary information regarding the steps that must be concluded when opening a Luxembourg fund. Our representatives can offer information on the most suitable type of fund investors should select, based on their investment capital and investment plans.