Lithuania Company Formation
Introduction to Registering a Company in Lithuania. Lithuania is the biggest of the Baltic states and regards itself as the region’s economic powerhouse. Certainly it has succeeded in attracting significant inflows of foreign direct investment, with investors encouraged by a combination of a stable economy, low inflation, low labour costs and a liberal business environment. Corporation tax is 15%, one of the lowest rates in the EU. But investors are advised to tread carefully. If you are thinking of opening a company in Lithuania, please contact us and we will help you every step of the way. Please contact us for further details today.
Types Of Companies In Lithunia
Choosing the right company type is crucial for your business success. At IBHUB, we help you select the structure that suits your goals and complies with Lithunia regulations.
1. Public Limited Company (AB)
- Minimum share capital: €40,000 (fully paid before registration).
- Minimum 1 shareholder (individual or legal entity; local or foreign).
- Must have a Board of Directors (at least 3 members).
- Supervisory Council is optional unless specified by law.
2. Private Limited Company (UAB)
- Minimum share capital: €2,500 (can be contributed in cash or assets).
- Minimum 1 shareholder (individual or legal entity; Lithuanian or foreign).
- Minimum 1 director (can also be the shareholder).
- Must have a registered office address in Lithuania.
3. limited partnership (KUB)
- Formed by at least two partners:
General Partner (unlimited liability).
Limited Partner (liability limited to their contribution). - No minimum share capital required.
- Must have a registered office in Lithuania.
- Partnership agreement must be signed and submitted during registration.
Advantages
1. Public Limited Company (AB)
- Ability to raise capital from the public and institutional investors.
- Enhanced credibility and reputation in the market.
- Must have a Board of Directors (at least 3 members).
- Ideal for joint ventures, large-scale projects, and multinational expansion.
- Shareholder liability is limited to the amount of capital invested.
- Easier to attract venture capital and strategic partnerships.
2. Private Limited Company (UAB)
- Low capital requirement – only €2,500 to start.
- Quick and easy registration process (can be done online).
- Full foreign ownership is allowed.
- Limited liability protection for all shareholders.
- Tax-efficient with 15% standard corporate tax.
3. limited partnership (KUB)
- No capital requirement – lowers entry barrier for new ventures.
- Simple structure with clear division of roles and responsibilities.
- Flexible management – only general partner is involved in day-to-day operations.
- Attractive for investors who want limited liability and no management duties.
- Tax transparency – income is taxed at the partner level, avoiding double taxation.
What are the main features of a branch or representative office?
- foreign parent is responsible for all liabilities
- branch office can conduct trade within scope set by parent
- representative office can promote but cannot trade
- at least one manager must reside in Lithuania
- no formal auditing requirements
How easy is it to recruit staff in Lithuania?
Lithuania used to be known as Soviet Silicon Valley, such was the reputation of its workforce for innovation and productivity. The Soviet era may now be over but its reputation remains intact. Lithuania’s workforce is generally young, well educated and very highly motivated, while labor costs are among the lowest in Europe. Recruitment is straightforward – contact us if you require local help with this, as well as information on setting up a company in Lithuania
Are there financial incentives available?
Investment incentives in Lithuania are centered on three Free Economic Zones in the cities of Klaipeda, Utena and Kaišiadorys. They include the following:
- tax holidays and tax reductions for companies investing over €1 million
- no taxes on dividends paid on foreign investments
- EU support funds for companies setting up in Klaipeda
And what about banking facilities?
Lithuanian banks offer the standard range of facilities, including foreign exchange and international payments. There are no foreign exchange restrictions. You will need a local bank account if you open a company in Lithuania and we will be happy to help you with this.
How can I get more information?
Our company formation service makes it easy for you to open a company in Lithuania, so please contact us for further details, and we can help you register a company in Lithuania in the quickest possible timeframe!