Lithuania is a country situated in the Baltic region of Northern Europe. It is officially called the “Republic of Lithuania”. Setting up a business in Lithuania is quite hassle-free and straightforward. It can be attributed to Lithuania’s flourishing startup culture. Even the coronavirus crisis hasn’t affected the Lithuanian startup ecosystem in the same way as the rest of Europe.
Usually, foreign investors who would like to start a business in Lithuania get the option of setting up various forms of companies. Among these limited liability companies are the most common way to invest, especially for small investors. Following are some of the key featured of such a company:
Features of Private limited liability company (UAB)
- Authorised capital
The minimum registered capital is EUR 2,900, which must be formed in bank account;
at least 25% must be paid up. The capital is divided into shares, which may not be offered for sale or traded publicly.
Here even one person can be the founder/s (shareholder/s) of a private limited liability company, who could be a resident or non-resident of the Republic of Lithuania.
A private limited liability company is qualified as a legal entity.
The company and its shareholders have limited liability. The shareholders’ undertaking is limited to the amount of the invested capital amount only.
- Management body
It is determined by the general shareholders meeting without any requirement for board or supervisory council. The maximum number of shareholders in a private limited liability company is 250.
Annual audits will be done if turnover exceeds EUR1.4m.
Steps to open Lithuanian limited liability company
- Check the availability of the chosen name :
The first step is checking the availability of the chosen name at the Public Institution Register Centre. If the name is available, then a reservation can be made.
- Prepare Articles of Association (AoA) :
The Articles of Association must be prepared with the following information: thecompany’s name, it’s status as a private limited liability company, the capital amount, the business type, the shares, headquarter, company duration and the signing date of the Articles.
For only one shareholder, a Constitutive Act must be signed.
For more than one member, the Memorandum of Association will be signed. The Memorandum must contain information regarding the incorporator, Articles of Association, the company’s name, shares’ information, the representative’ name and the signing date.
- Open a bank account with the minimum share capital of approx. 2900 Euro. A receipt will be used as proof of payment.
The documents regarding headquarter needs to be filled up. A shareholder’s list is also required.
- Articles of Association must be notarised and application must be filed,
- Receive a Statement of Registration after the above documents are deposited at the Public Institution Register Centre.
- Get a company seal to perform the transactions,
- Apply for taxes at the State Tax Inspectorate. This process is not cumbersome and will be over within 5 days after the registration.
After you finish the registration procedure, you must hire an accountant. For getting any such assistance please get in touch with our Business specialist in Lithuania.
Costs for setting up a Limited Liability Company in Lithuania
Foreign investors are often curious about the cost of setting up UAB in Lithuania. These costs are as follows:
|Preparation as well as legalisation of the company’s documents
|Depends on the notary, on average 100 euros
|Opening a bank account
|Registering at the Trade Register
|Approximately 60 euros
|Taxation and VAT registration
|Social security registration
For getting any such assistance please get in touch with our Business specialist in Lithuania.