In the modern world, Lithuania is considered the economic center of the Baltic region. This is due to a stable economy, a comfortable business environment, and low inflation. That is why most entrepreneurs choose this country to enter the European market. Below you can read Maira Consult's recommendations on how to open a company in Lithuania.
What are the main points of opening a company in Lithuania?
We recommend choosing this country for companies operating in the agricultural sector, IT services, logistics, or transportation. The main points you need to know to open a company in Lithuania:
- For these areas, the main form of company is a closed joint-stock company (UAB). In companies of this type, the founders' liability to third parties is limited only to the company's property. If you wish, you can register a company in Lithuania with only one founder, without shareholders. They also have the right to be a shareholder. It should be borne in mind that its minimum amount is 924 euros.
- To open a company in Lithuania in the form of a UAB, the minimum authorized capital must be equal to 1000 euros. This amount must be deposited into the company's account and used after opening for operating expenses.
- Opening a company in Lithuania is possible in a remote format.
- Small companies have an advantage because they pay only 5% income tax.
- The company does not need to obtain a VAT number immediately after registration.
- Information about the director, shareholders and the company itself is publicly available.
- The company name must be unique, so you need to make a request to the Trade Register in advance.
Tax nuances and reporting of open companies in Lithuania
We recommend opening a company in Lithuania if a businessman needs maximum speed of registration and low taxes. This is especially true for entrepreneurs working in the transportation sector. However, it is equally important to submit financial reports on time, obtain VAT and pay taxes. Maira Consult can advise on the following financial issues:
- accounting statements;
- procedure for obtaining a VAT number;
- execution of contracts;
- maintenance of internal documentation;
- conducting an audit;
- work with tax returns and reports.
Next, we will consider everything related to taxes and reports in Lithuania.
Official reporting
All Lithuanian companies must maintain and submit annual financial statements based on the reporting period. In Lithuania, it is 12 calendar months. The document must be submitted by June 1 of the current year.
An accountant must prepare the following documents:
- Company profit declaration (submitted to the tax office);
- profit and loss statement, balance sheet, statement of changes in the company's capital and explanatory letter (to be submitted to the register of legal entities).
Audit is required for open or closed joint stock companies in the following cases:
- the value of the property is more than EUR 2 million;
- the company's sales revenues exceed EUR 3.5 million;
- the company has more than 50 official employees.
VAT
For companies that have just registered, obtaining a VAT number is voluntary. Later on, it is mandatory to obtain it in the following cases:
- The cost of goods purchased in other EU countries during the calendar year exceeds EUR 10,000.
- The income from goods sold or services rendered in the last calendar year exceeds EUR 45,000. Exceptions are the purchase of new vehicles and goods subject to excise in Lithuania.
- Ownership of controlling stakes in several Lithuanian companies by one person.
The usual VAT rate is 21%. But there are cases when it is 0%. Let's consider them:
- Export of goods outside the country;
- Purchase and sale of goods outside the country (they do not even enter Lithuania);
- Sale of used cars that were previously registered as company property.
Taxes
If you want to open a company in Lithuania, you should know that the mandatory tax for the country is income tax. For UAB companies, it is 5%. A company must pay a maximum of 15% in the following cases:
- the company's turnover in the account for a period of one year is more than 300,000 euros;
- the company has more than 10 official employees;
- the founder has a controlling stake in another Lithuanian company;
- the founder's spouse has an open individual enterprise in the country.
The country also has a low tax rate on passive income and dividends - only 0%-15%. Zero percent will be the case if a Lithuanian company has managed 10% or more of shares in another Lithuanian company in Lithuania for one year. The same percentage can be in a foreign company if it is not registered in an offshore zone.
How to open a company account with Maira Consult?
Maira Consult recommends doing this in a reliable Siauliu Bank. Remote account opening is not possible, so the owner must come to Vilnius. We will help you with the following steps:filling out the application form;
- preparing a package of documents;
- submitting documents directly to the bank.
If you need an account in Lithuanian payment systems, we recommend choosing the following:
Interested in more detailed information on how to open a company in Lithuania? Contact Maira Consult for a free consultation.
