Lithuania, a Baltic nation nestled within the European Union, has been making waves in recent years as a prime destination for enterprise and investment. With its strategic location, skilled workforce, favorable business environment, and vibrant entrepreneurial ecosystem, it’s no wonder that many international entrepreneurs are considering company registration in Lithuania. If you’re one of them, this comprehensive guide will walk you through the process step by step.
Forms of business in Lithuania:
The first step in registering a company in government is to determine the most suitable corporation structure for your venture. The options available include:
- UAB (Uždaroji Akcinė Bendrovė): This is the equivalent of a private limited liability firm and is the most common enterprise structure. It requires a minimum share capital of €2,500.
- MB (Mažoji Bendrija): A small partnership suitable for businesses with fewer owners and lower capital requirements.
- IĮ (Individuali Įmonė): This is a sole proprietorship suitable for small-scale businesses.
Choose a Company Name:
Selecting an appropriate company name is crucial. The name should not only reflect your enterprise identity but also concede with Lithuania’s naming regulations. The chosen name should be unique, not infringe upon any trademarks, and follow the guidelines set by the Registrar of Legal Entities.
Prepare Necessary Documents:
Gather all the necessary documentation to support your Lithuania company registration process. This typically includes:
- Articles of Association: This outlines the internal regulations and operation of the company.
- Sharers’ agreement, if applicable.
- Proof of address for the company’s registered office.
- Identification documents of shareholders, directors, and other key personnel.
- Consent forms, if applicable.
- Any other documentation required for specific business activities or licenses.
Register company in Lithuania:
To enroll your firm in country, follow these steps:
- Electronic Enrollment: Most establishment registrations are done electronically through the Enroll of Legal Entities’ online portal. You will need to create an account and submit all the needed papers and info.
- Notary Certification: In some cases, certain documents may need to be notarized. This is often needed for the establishment of the company’s Articles of Association.
- Registration Fee: Pay the registration fee, which varies depending on the type of company you’re registering.
Obtain Tax Identification Numbers:
After successful company formation in Lithuania, you’ll need to obtain tax identification numbers for your company and its employees. This is necessary for proper tax compliance in Lithuania.
Open a Bank Account:
Next, open a business bank account in a Lithuanian bank. Having a local bank account will simplify financial transactions and ensure smooth business operations.
Compliance and Reporting:
Your responsibilities as an enrolled organization in Lithuania don’t end with registration. You’ll need to ensure ongoing compliance with taxation, accounting, and reporting requirements. This includes filing annual financial statements, VAT returns, and adhering to any other relevant regulations.
Purchase of a ready-made company in Lithuania
The process of establishing a new organization from scratch can be time-consuming and involve various administrative steps. An alternative option gaining popularity, especially among entrepreneurs looking for a streamlined entry into the business world, is the purchase of a ready-made corporation. This method offers several advantages, but it’s essential to understand the process and considerations before making a decision. This article delves into the concept of purchasing a ready-made enterprise in country.
What is a Ready-Made Firm?
A ready-made company, also known as a shelf company or an off-the-shelf company, is a legal entity that has been previously registered but has not conducted any business activities. These enterprises are pre-registered with the relevant authorities and often come with a basic structure, including a registered office, firm name, and legal documentation. Entrepreneurs who opt for a ready-made enterprise can start their corporation operations more swiftly than if they were to set up a new company from scratch.
Advantages of Purchasing a Ready-Made Company:
- Time-Saving: One of the most significant benefits is the time saved. Setting up a new company can take weeks or even months, while purchasing a ready-made company allows you to start operations almost immediately.
- Established Presence: The purchased enterprise already has a legal presence, which can be beneficial for securing contracts, engaging with clients, and accessing financial services.
- History: Depending on the situation, having an enterprise with an established enrollment date may provide a perception of credibility and stability.
- Bypassing Administrative Steps: With a ready-made company, you can avoid various administrative tasks, such as drafting Articles of Association and submitting registration documents.
- Potential Tax Benefits: Depending on the specific corporation and circumstances, there might be potential tax advantages associated with purchasing a ready-made company.
Considerations Before Purchase:
- Due Diligence: Just like any business transaction, due diligence is crucial. Verify the company’s history, legal standing, any conceivable liabilities, and its suitability for your industry plans.
- Name and Actions: While you might be able to change the company’s name and activities, it’s essential to ensure that the company’s existing name and activities do not conflict with your enterprise goals.
- Legal and Financial Review: Engage legal and financial professionals to review the company’s documentation, ensuring that everything is in order and compliant with Lithuanian regulations.
- Transfer Process: Understand the process of transferring ownership of the company, updating company details, and making any necessary changes.
- Future Plans: Consider whether the extant structure of the ready-made establishment aligns with your future plans and growth strategies.
Company registration in Lithuania offers access to a dynamic and promising business environment within the European Union. The process, although straightforward, requires careful attention to detail and compliance with legal requirements. Seeking professional advice from legal, accounting, and business experts can prove invaluable throughout the registration process and in the long-term management of your establishment. With the right approach, your venture can thrive in the heart of the Baltic region.
How much does it cost to register a company in Lithuania?
The cost of registering a corporation in state can vary based on the type of business structure you choose and any additional services you require. As of my last knowledge update in September 2021, the registration fee for a UAB (private limited liability company) was around €250, and there was a requirement to have a minimum share capital of €2,500. Keep in mind that these fees might have changed since then, so it’s recommended to check the latest info on the official website of the Enroll of Legal Entities in country.
How can I open a company in Lithuania?
Open a company in Lithuania involves several steps:
- Choose a Firm Structure: Select on the type of business structure that suits your needs, such as UAB, MB, or IĮ.
- Choose a Company Name: Select a unique and compliant company name.
- Prepare Documents: Gather all required documents, including Articles of Association, identification documents, and proof of address.
- Register Online: Use the Enroll of Legal Entities’ online portal for electronic registration. Submit your documents, pay the registration fee, and await approval.
- Obtain Tax Identification Numbers: Apply for tax identification numbers for your company and employees.
- Open a Bank Account: Spread a enterprise bank account in country.
- Compliance and Reporting: Ensure ongoing compliance with tax, accounting, and reporting requirements.
Why do corporations enroll in Lithuania?
Organizations register in Lithuania for various reasons, including:
- Strategic Location: Lithuania’s strategic location in the heart of Europe offers access to the EU market and excellent logistics connections.
- Favorable Business Environment: The country offers a business-friendly environment with relatively low bureaucracy, competitive tax rates, and incentives for certain industries.
- Skilled Workforce: Lithuania boasts a highly educated and skilled workforce, particularly in technology and engineering sectors.
- EU Membership: Being an EU member state provides companies with access to a large and integrated market.
- Startup Ecosystem: Lithuania’s growing startup ecosystem, especially in Vilnius, attracts entrepreneurs with innovative ideas and opportunities for growth.
How do I verify a company in Lithuania?
To verify a company in Lithuania, you can follow these steps:
- Enroll of Legal Entities: Check the official Enroll of Legal Entities in state to confirm the company’s legal status, ownership, and other relevant info.
- VAT Information: Verify the company’s VAT number through the VIES (VAT Information Exchange System) to ensure its legitimacy for VAT-related activities.
- Financial Statements: Access publicly available financial statements to assess the company’s financial health and stability.
- Commercial Registers: Utilize commercial registers or business databases to gather additional info about the company’s history, directors, and activities.
- Legal and Financial Experts: Engage legal and financial professionals to conduct due diligence if needed, especially for more complex transactions or investments.