š±š¹ Guide to Company Formation in Lithuania (2025)
Lithuania in Numbers
Are you thinking about company formation in Lithuania? Did you know that Lithuania ranks #1 in the EU for ease of starting a business digitally, with over 3,500 new companies registered each month? The country offers a corporate tax rate as low as 5% for small businesses, and VAT registration is required only after reaching €45,000 turnover per year. With a minimum share capital of just €2,500 for a UAB, Lithuania is ideal for entrepreneurs seeking a fast, affordable, and efficient way to form a company in Lithuania.
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✅ Why Form a Company in Lithuania?
Lithuania offers a business-friendly environment with strategic access to the EU, low operational costs, and a highly educated workforce. Its digital-first government services allow companies to register online within 3–5 business days, making company registration in Lithuania fast and straightforward. Lithuania is particularly attractive for startups, fintech ventures, holding companies, and R&D-heavy businesses due to tax incentives and EU market access.
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💼 Types of Companies in Lithuania
The most popular legal structure in Lithuania is the Uždaroji akcinė bendrovė (UAB), which is a private limited liability company. Establishing a UAB requires a minimum share capital of €2,500, and it provides both limited liability protection and credibility, which is particularly attractive to startups and small to medium-sized enterprises (SMEs). Shareholders are only liable for the company’s obligations up to the amount of their invested capital, which reduces personal financial risk.
UABs are highly flexible in terms of management and ownership. They can be founded by a single shareholder or multiple shareholders, including both individuals and corporate entities, and there are no restrictions on foreign ownership. This makes the UAB ideal for international entrepreneurs looking to form a company in Lithuania. Directors do not need to be Lithuanian residents, although having a local representative can simplify compliance and banking processes.
For larger or publicly traded companies, the Akcinė bendrovė (AB) is more suitable. ABs require a higher minimum share capital of €40,000 and are subject to stricter corporate governance rules, including mandatory supervisory boards and more detailed reporting requirements. This structure is often chosen by businesses planning to raise capital publicly or operate on a larger scale.
Partnerships, such as the individuali įmonė (IĮ) or general and limited partnerships, are more suitable for smaller operations or family-run businesses, but they carry unlimited liability for the partners. Foreign companies can also establish branches in Lithuania, which do not require local share capital but depend on the parent company for legal and financial obligations.
The choice of legal structure ultimately depends on factors such as the size of your business, the number of shareholders, your expansion plans, desired liability protection, and regulatory compliance needs. Entrepreneurs should carefully consider these factors when deciding the best type of company to register in Lithuania, and professional guidance can significantly streamline the process.
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📄 Legal and Documentation Requirements
To successfully register a company in Lithuania, certain legal documents and information are required. The cornerstone of any company registration is the Articles of Association, which define the company’s purpose, structure, share capital, management, and internal governance rules. This document ensures clarity on how the company will operate and is required for all company types, including UABs and ABs.
Founders must provide detailed shareholder and director information, including full names, addresses, dates of birth, nationality, and identification documents such as passports or national IDs. For corporate shareholders, registration certificates or incorporation documents of the parent company are needed. Lithuania allows 100% foreign ownership, and there are no residency requirements for shareholders, although having a local director or representative can simplify compliance and banking procedures.
A proof of registered office is mandatory. The company must have a physical address in Lithuania, which will be used for official correspondence and legal notifications. This can be a rented office, a serviced office, or a virtual office that meets Lithuanian legal requirements.
To demonstrate financial commitment, a bank certificate showing the deposited share capital is required. For a UAB, the minimum share capital is €2,500, while for an AB it is €40,000. Depositing the share capital into a Lithuanian business bank account is a crucial step before submitting documents for registration.
Non-resident founders may also need notarized and translated documents, depending on their country of origin and the company structure. All documents must be submitted to the Lithuanian Centre of Registers, which oversees company formation and maintains the official Commercial Register in Lithuania (link here). The Centre of Registers reviews the submission, verifies the documents, and issues a registration certificate once everything is in order.
Additionally, companies must register for tax purposes with the State Tax Authority (VMI) (link here) and, if applicable, for VAT. Depending on the business activities, certain licenses or permits may also be required, such as for financial services, e-commerce, or regulated industries.
By preparing all required documents carefully and ensuring compliance with legal requirements, founders can streamline company registration in Lithuania, reduce delays, and avoid potential legal issues. Professional assistance, such as that offered by Eesti Consulting, can guide non-residents through notarization, translation, and submission procedures, ensuring a smooth incorporation process.
🕒 Company Registration Process
The registration process includes name reservation, document preparation, submission to the Centre of Registers, and VAT registration with the State Tax Authority: Lithuanian Tax Authority. A UAB can usually be incorporated in 3–5 business days, especially if done digitally.
Companies can also be registered by Power of Attorney, allowing founders to stay abroad, or by acquiring a ready-made company. Eesti Consulting can assist with both options, guiding you through the entire registration and compliance process.
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💳 How to Open a Bank Account in Lithuania
Opening a business bank account is essential for depositing share capital and handling transactions. Entrepreneurs have several options:
WISE: A cost-effective international account suitable for digital-first businesses.
Revolut: Provides online business banking with multi-currency accounts.
Paysera: A Lithuanian fintech offering local and SEPA payments.
Payment processors like Stripe or Payoneer are fully supported, enabling smooth international transactions.
Buy Ready Made Company in Lithuania.
🧾 Taxation and VAT
Lithuania offers competitive corporate taxation. The standard corporate tax rate is 15%, while small companies with turnover under €300,000 and up to 10 employees pay only 5%. VAT is set at 21%, with reduced rates of 9% and 5% for certain goods and services. The VAT registration threshold is €45,000 annual turnover.
🏷️ How to Register a Trademark in Lithuania
Protecting your brand is essential. Lithuania allows trademarks to be registered with the State Patent Bureau. Entrepreneurs can also benefit from the SME Fund 20https://smefund2025.eesticonsulting.ee25, which reimburses up to 75% of trademark application fees. This makes company formation in Lithuania even more cost-effective, allowing startups and SMEs to secure both their company and brand with reduced state fees.
🌍 Lithuania vs Estonia: Which Is Better?
Both Lithuania 🇱🇹 and Estonia 🇪🇪 are excellent for forming companies, but they cater to slightly different needs. Lithuania has a 15% corporate tax rate (5% for small companies), whereas Estonia taxes only distributed profits at 20%, leaving reinvested profits tax-free. VAT thresholds are €45,000 in Lithuania and €40,000 in Estonia. Lithuania’s UAB requires €2,500 share capital, the same as Estonia’s OÜ.
Estonia is ideal for founders seeking fully digital, remote management through its e-Residency program, while Lithuania offers access to a growing labor market, strong fintech support, and R&D incentives. Both jurisdictions provide participation exemptions on dividends and capital gains, making them suitable for holding companies and international operations.
🏁 How Eesti Consulting Can Help
Eesti Consulting can guide you through every step of company formation in Lithuania, whether you want to register by Power of Attorney or acquire a ready-made company. Services include: company incorporation, bank account setup, VAT registration, accounting, and compliance support.
We also assist with SME Fund 2025 applications, helping you claim vouchers for 75% reimbursement of state fees, including trademark registrations. This makes your company registration in Lithuania more affordable and ensures your business is fully compliant from day one.
🔗 Useful External Resources