Tax benefits for start-ups in Luxembourg

Tax benefits for start-ups in Luxembourg

Luxembourg is renowned for its business-friendly environment, especially for start-ups. Thanks to an advantageous tax regime and a wide range of available grants, start-ups can benefit from unique opportunities to develop rapidly. This article explores the main tax advantages available to start-ups in Luxembourg in 2024.

Advantageous tax rates

One of the main tax attractions for start-ups in Luxembourg is the competitive tax rate. Companies generating taxable income of less than EUR 175,000 benefit from a tax rate of just 15%. This rate is particularly attractive for young companies looking to reinvest their profits to support their growth. This tax policy gives start-ups more capital to invest in innovation and expansion, encouraging rapid development.

Investment incentives

The Luxembourg government offers several tax incentives to encourage investment in start-ups. For example, investment deductions allow companies to deduct part of the costs associated with the purchase of new equipment or technological innovation. These deductions not only reduce the immediate tax burden on start-ups, but also encourage modernization and business expansion, creating a virtuous circle of growth. These incentives are essential for start-ups wishing to remain competitive by investing in the latest technologies and infrastructure.

Specific tax exemptions

Certain start-ups can benefit from partial or total tax exemptions, depending on their sector of activity and their contribution to innovation or sustainable development. These exemptions can include reductions in corporation tax, council tax and other fiscal contributions. These measures are specifically designed to lighten the tax burden of innovative companies, enabling them to concentrate on growth without being burdened by heavy taxation. Start-ups in sectors such as green technology, healthcare and renewable energies can particularly benefit from these exemptions.

Financial aid and subsidies

In addition to direct tax benefits, start-ups in Luxembourg can access a wide range of grants and financial assistance. These can cover part of the costs of research and development, innovation projects, or sustainable development initiatives. By working with local authorities, start-ups can obtain additional funding to support their ambitions. These grants are often crucial for young companies in need of capital to finance key projects, without compromising their financial viability.

Personalized guidance and support

Luxembourg doesn’t just offer tax advantages, it also provides a solid ecosystem for start-ups, with easy access to chartered accountants, lawyers and specialist advisors. These professionals can help start-ups navigate the Luxembourg tax system and maximize the benefits available. Personalized guidance is crucial to avoid tax pitfalls and to ensure that start-ups take full advantage of the opportunities offered by current legislation. Working with experts also enables start-ups to focus on their growth, with the reassurance that their tax compliance is being optimally managed.