Set up a UAB in Lithuania

As a foreign investor interested in opening a company in Lithuania, you must know that you have the possibility of choosing from several company types. Among these, limited liability companies are very popular. A company type that is generally selected for incorporation is the private limited liability company in Lithuania – Uzdaroji Akcine Bendrove (UAB), a business form that requires a capital of EUR 2,500 in 2024.

Investors must know that the registration of this company type requires the payment of a small fee, charged by the State Enterprise Center of Registers, where the incorporation procedure is done. 

The fee charged by the institution in 2024 is of EUR 30,83. The same fee applies if the founder is a natural person or a legal entity. The fees charged in 2024 vary depending on the legal entity you will register, so if you want to register other business forms, you will have to verify the fees charged for 2024 by the institution. 

It may be formed by a single shareholder, but the maximum number may not overcome 249. The company formation in Lithuania does not exceed 3 weeks after registration if all the requested papers are in order. Our company formation agents in Lithuania can offer more information on the requirements for setting up a UAB.

Quick Facts
Types of LLCs	Investors can set up only the limited liability company (Uzdaroji Akcine Bendrove).
Most suitable for	One can set up a UAB in Lithuania for almost all business activities regulated under the Lithuanian law.
Minimum number of shareholders	1
Maximum number of shareholders (if applicable)	250
Law regulating the procedure to open a limited liability company in Lithuania	Law on Companies.
Institution in charge with the registration of the LLC in Lithuania	The Register of Legal Entities
Director requirements	In order to set up a UAB in Lithuania, the shareholders must appoint at least 1 director (the shareholder can be the director, but if there are more shareholders, a board of directors can be set up).
Corporate taxes	The standard corporate tax is charged at a rate of 15%. Small companies and agricultural companies can benefit from reduced corporate tax rates of 0% or 5%. Starting with 1 July 2022, a corporate tax of 20% is charged to credit institutions.
Minimum requirements in order to open a limited liability company in Lithuania	Prepare and sign the incorporation documents, find a suitable office space, submit the minimum share capital (EUR 2,500), open a corporate bank account, obtain any business permits and licenses needed.
Apply for a business number  (yes/no)	Yes
Foreign ownership rules	Foreigners can own 100% of the shares of a company registered in Lithuania.
Who can register a LLC	Tax residents who are individuals or companies. Foreign natural persons and legal entities can also set up a UAB in Lithuania.
Statutory documents of the LLC	The Articles of Association
Documents to prepare for the incorporation	Identity documents of the person registering the company, evidence on a temporary trading name issued by the Register of Legal Entities, evidence on having an official business office and a consent to use it from the owner of the premises, a statement of available funds, the company's incorporation documents.
Audit requirements (yes/no)	Yes (only if 2 of the following 3 conditions apply: net turnover is above EUR 3,5 million, total value of assets above EUR 1,8 million, number of payroll employees is of 50 in a financial year).

Steps to open a Lithuanian limited liability company in 2024 

The first step in opening a private limited liability company in Lithuania 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. The entrepreneur must prepare the articles of association containing information on the following: the name of the company, the fact that it is a private limited liability company, the amount of capital, the type of business, the headquarter, shares, company duration if it’s a temporary one, and the signing date of the articles.

One of the requirements that investors have to comply with during the process of company formation in Lithuania is to provide an electronic signature. This is, of course, applicable for those who complete this process through the online option. Since the beginning of 2021, this option is also available for foreign investors, who can now obtain a certificate for their electronic signature, by following specific procedures. You can refer to our team of consultants, who can advise on this step. 

If there is only one shareholder, a Constitutive Act must be signed. If there is more than one member, the memorandum of association must be signed. The memorandum must contain information regarding the articles of association, the incorporator, the name of the company, information on the shares, the name of the representative, the date when the document was signed.

A bank account must be opened and the minimum share capital of approx. EUR 2,500 must be deposited. One has to provide a receipt, through which it can be seen that the capital was deposited.  The documents regarding headquarter must be filled up. A list of the shareholders is also required.

After notarizing the articles of association and filing an application, the above documents must be deposited at the Public Institution Register Centre and a Statement of Registration must be received. The next step is getting a company seal, used in every transaction the newly formed firm will perform.

The last step in incorporating a UAB is applying for the taxes at the Tax-Payer, working under the State Tax Inspectorate. This process mustn’t overcome 5 days after the registration. After you complete the registration procedure, you should hire an accountant.  We can recommend you accountants in different countries, if you choose to open other firms in countries from Europe, such as Romania. 

The UAB is liable to the payment of all corporate taxes charged to businesses, such as the corporate tax, employment taxes, withholding taxes, value added tax (VAT) and any others stipulated by the law. A company in Lithuania must complete its VAT registration formalities on a voluntary or mandatory basis, and this can vary based on the annual income the company has obtained.

At the moment (2024), the threshold for VAT registration was increased to EUR 55,000. This regulation became applicable starting with 1 January 2024, and it was increased from the previous EUR 45,000, following a governmental law that aims at reducing the tax burden on small businesses and this law can have very good effects on UABs, as they are generally set up for the needs of small businesses.

The highlights of a Lithuanian UAB 

If you want to open a company in Lithuania as a UAB, you most likely want to find out as many details as possible about this structure. This is why our team of consultants in company registration in Lithuania has prepared a short list of aspects that you should know about this company type: 

• • the process for company formation in Lithuania can be completed in approximately 3 weeks;
• • the steps for opening a corporate bank account can last approximately 2 weeks;
• • the company is required to file annual tax returns and must have a tax registration certificate;
• • the company can have foreign directors, who do not have to meet residency requirements;
• • the Lithuanian UAB can have shareholders as natural persons, but also corporate entities;
• • the company has to conclude an audit in the case in which the annual assets are above EUR 1,8 million. 

From an accounting point of view, the Lithuanian UAB must file its annual financial statements. This company type can be used for entering import-export activities of a wide category of goods. It is also worth knowing that the legal entity can own its own assets and can purchase properties in this country. Our team of specialists in company registration in Lithuania can offer additional information. 

We invite you to watch the video below on how to set up a UAB in Lithuania: 

Our local agents offer more information on these costs. If you need advice on how to open a Lithuanian company as a UAB or information on the costs associated with other company types, you can address to our team. Our consultants in Lithuania company formation can provide details on the costs of registering a branch office or a representative office as well.   

What is the data on foreign investments in Lithuania?

Foreign businessmen who want to open a Lithuanian company will most likely be interested in knowing up-to-date information on the dynamics of foreign direct investments carried out here, as this provides valuable data on the country’s ability to attract investors on the local market, but also on the incentives and other advantages foreign investors can find here. According to the Official Statistics Portal of Lithuania, the data on foreign investments show the following: 

• • in the 1st quarter of 2020, the total investments in Lithuania accounted for EUR 18,674.22 million, while in the 3rd quarter, it stood at EUR 19,084.77 million;
• • most of the investments were made by investors from the European Union (EU) – in the 1st quarter, EU businessmen invested EUR 16,057.95 million from the total investments of the respective period;
• • an important investor interested in opening a Lithuanian company is one of the neighboring countries, Estonia, which invested EUR 2,859.63 million in the 1st quarter;
• • the most important investor in 2020 was Sweden, which invested in the 1st quarter EUR 3,151.64 million, increasing to EUR 3,433.34 million in the 3rd quarter;
• • The Netherlands is also an important investor, accounting for EUR 2,637.68 million in the 1st quarter of 2020.

Questions related to starting a UAB in Lithuania in 2024 

Oftentimes, foreign investors ask a basic set of questions with regards to the registration of a company in Lithuania. This is why, below, we have prepared a short list of the most common questions we receive on the registration of a Lithuanian private limited liability company.