Luxembourg is a country very popular with entrepreneurs, especially for its interesting tax benefits. Whether you are a freelancer, self-employed or a small business manager, it is possible to take advantage of these advantages without having to rent a large office. How? By domiciliating your company in a coworking space. Here’s how it works.

Disclaimer – Terminology “domiciliation”

To facilitate the understanding of non-specialist readers and due to the widespread use of the term “domicile” on the Internet, we sometimes use this word in our communications for didactic reasons. However, it is important to specify that, in the context of a business center, the term “domiciliation” is not legally appropriate for our activities: indeed, domiciliation contracts are strictly reserved for authorized domicile agents, in accordance with the legal provisions in force. This distinction is essential, and our services must be understood as the provision of professional spaces and services, and not as a domiciliation contract in the legal sense of the term. For business centres, readers should understand this activity as hosting head office for activities.

Tax benefits that attract businesses

Luxembourg offers a lighter tax system than in many neighbouring countries. This helps small structures to start or grow without being crushed by taxes.

A tax for small companies

• If your company makes less than €175,000 in profit per year, you can benefit from a reduced rate of 15% corporate tax.
• Beyond this amount, the overall tax rate remains competitive, around 24.94% in Luxembourg City (corporate tax + municipal tax + employment fund)

Other concrete tax benefits

• Luxembourg applies a regime called mother-daughter. This means that if your company receives dividends from another company in which it holds shares, this income may be exempt from tax
• There is also a partial exemption from capital gains realized on shares, if certain conditions are met.
• Finally, the country agrees to deduct a lot of professional expenses (rents, supplies, travel, etc.). This makes it possible to reduce the taxable profit in a legal way.

No double taxation

Thanks to more than 80 tax treaties signed with other countries (France, Belgium, Germany, etc.), you do not pay taxes twice on the same income if you work internationally. This is a real plus for the self-employed or companies that bill abroad.

Why combine coworking and Luxembourg taxation?

Settling in a classic office in Luxembourg can be expensive. Fortunately, there is a simple solution: use a coworking space like Colors, which offers a professional space with address for your head office from €199 excluding VAT per month.

What you earn with a coworking

• A recognized professional address for the creation of your company
• Access to furnished offices, fast internet connection, meeting rooms and cleaning included
• Access to the common parking lot

Save without sacrificing quality

Where a classic office often imposes:

• A commitment over several years
• High costs (furniture, electricity, maintenance, internet)
• Long and expensive procedures

Coworking allows you to have all this at a low price and without long-term commitment and to benefit from the tax benefits specific to Luxembourg!

A good solution to get started

Coworking is perfect for:

• Test the Luxembourg market
• Set up a foreign subsidiary without investing too much
• Start your business quickly with a controlled budget

Bonus: image, network and simplicity

In addition to the tax aspect, a coworking space brings:

• A good image of your company (serious and visible address)
• A better separation between work and private life
• Opportunities to meet other professionals

To summarize, what are the tax benefits for your coworking company?

By domiciliating your company in Luxembourg in a coworking space, you benefit from:

• Very interesting tax benefits
• An official address to start your business
• From a professional environment, without the heavy costs of a classic office

This is a good plan if you are:

• Entrepreneur in launch
• Independent or freelance
• Foreign company that wants to settle in Luxembourg

To learn more about domiciliation or offices for rent at reduced prices, visit our website.

You can also contact us directly to get a quote or visit the available spaces. Our offers adapt to all profiles, whether you are a freelancer, self-employed or manager of a small structure.

Benefit from tax benefits while settling at the best price in Luxembourg with Colors!