Company size thresholds in Luxembourg
Company size thresholds in Luxembourg drive the balance sheet layout, the content of the notes and the statutory audit. Amounts set by the Grand-Ducal Regulation of 25 October 2024, the repetition criterion and newly incorporated companies.
What are the company size thresholds in Luxembourg?
Company size thresholds in Luxembourg rest on three criteria, the balance sheet total, the net turnover and the average number of employees, of which at least two must be exceeded, or cease to be exceeded, over two consecutive financial years before a company changes category and therefore changes accounting obligations.
Three categories follow one another, micro, small and medium-sized undertaking, and the fourth is defined by default: a large undertaking is one that exceeds the medium-sized thresholds. Each step adds or removes a specific duty, the balance sheet layout, the profit and loss account layout, the content of the notes and the statutory audit.
The category is neither chosen nor declared. It is established at the closing date, criterion by criterion, then confirmed or contradicted at the following closing. That is the origin of most presentation corrections we meet when taking over a file: a company treated as small for several years although the crossing had in fact repeated.
The amounts in the table below are those set by the Grand-Ducal Regulation of 25 October 2024. The wider framework for preparing and filing financial statements is set out on our annual accounts page.
| Category | Balance sheet total | Net turnover | Employees (average number) |
|---|---|---|---|
| Micro undertaking | 450,000 euros | 900,000 euros | 10 |
| Small undertaking (article 35 LRCS) | 7,500,000 euros | 15,000,000 euros | 50 |
| Medium-sized undertaking (article 47 LRCS) | 25,000,000 euros | 50,000,000 euros | 250 |
| Large undertaking | Above 25,000,000 euros | Above 50,000,000 euros | Above 250 |
Two criteria out of three, over two consecutive financial years
A change of size category in Luxembourg only takes effect if it repeats: exceeding, or ceasing to exceed, the limits of two of the three criteria produces effects only where it occurs again over two consecutive financial years.
The rule is written in article 36(1) of the amended law of 19 December 2002: where, at the balance sheet date, an undertaking has either exceeded or ceased to exceed the limits of two of the three criteria set out in article 35, that circumstance produces effects for the application of the derogation provided for in that article only if it occurs over two consecutive financial years.
Its purpose is stated in the doctrine of the Commission des normes comptables: the repetition criterion was introduced to avoid transitory breaches of the retained thresholds influencing the preparation of the annual accounts. An atypical year, a one-off disposal or a single contribution therefore does not suffice.
The practical consequence is counter-intuitive. Raising the thresholds reclassifies nobody overnight: the Commission des normes comptables stresses that the effect is in principle not immediate but deferred, precisely because of that repetition criterion. A company eligible for the lower category must first accumulate two compliant closings.
The Grand-Ducal Regulation of 25 October 2024 raised the thresholds by 25%
Company size thresholds in Luxembourg were raised by the Grand-Ducal Regulation of 25 October 2024, which transposes delegated directive (EU) 2023/2775 and amends articles 35 and 47 of the amended law of 19 December 2002.
The driver was monetary rather than doctrinal. The European Commission adjusted and rounded up by 25% the thresholds in article 3 of directive 2013/34/EU, to take account of the inflation recorded since 2013 and, in particular, of the inflation of 2021 and 2022. The stated aim is to reduce the administrative burden weighing on undertakings and groups.
Luxembourg took the most generous option for small undertakings. The directive offers a choice between a balance sheet total of 5,000,000 euros and net turnover of 10,000,000 euros on the one hand, and 7,500,000 euros and 15,000,000 euros on the other: the Commission des normes comptables confirms that Luxembourg opted for a raise to their maximum levels, namely 7.5 million and 15 million euros.
The timeline deserves a second reading, because two dates coexist. The provisions of the delegated directive apply to financial years beginning on or after 1 January 2024, but Luxembourg exercised the option allowing the first application of the new thresholds to be brought forward to financial years beginning on 1 January 2023 or after.
| Step | Date or scope |
|---|---|
| Delegated directive (EU) 2023/2775 | Adopted on 17 October 2023, 25% adjustment of the thresholds in directive 2013/34/EU |
| Luxembourg transposition | Grand-Ducal Regulation of 25 October 2024 |
| Texts amended | Articles 35 and 47 of the amended law of 19 December 2002, article 1711-4 of the law of 10 August 1915 |
| Default first application | Financial years beginning on or after 1 January 2024 |
| Early application option taken by Luxembourg | Financial years beginning on 1 January 2023 or after |
| Effect on categorisation | Deferred, through the repetition criterion of article 36 LRCS |
What the category changes: abbreviated balance sheet, notes, statutory audit
The size category of a Luxembourg undertaking drives the form of its annual accounts and their audit: article 35 opens the abbreviated balance sheet layout, article 47 the abbreviated profit and loss account layout, and article 66 a lighter set of notes.
The micro-undertaking regime goes further, since it removes the duty to prepare notes at all. The exemption is not a blank cheque: where there are no notes, certain information must appear below the balance sheet, which presupposes knowing which items those are before deleting the document.
For a small undertaking the relief is narrower than is often assumed. The first sentence of article 66 allows undertakings within article 35 to prepare abbreviated notes without the disclosures required by article 65(1)(2°), that is, the statement of participations held.
The statutory audit follows the same switch. It must be entrusted to one or more approved statutory auditors in any company which, at the balance sheet date and after two consecutive financial years, exceeds the numerical limits of two of the three criteria; for a SARL, a supervisory body is in addition mandatory above sixty members. The distinction between the two functions is set out on our statutory auditor page.
| Obligation | Applicable rule |
|---|---|
| Abbreviated balance sheet layout | Undertakings not exceeding the criteria of article 35 LRCS |
| Abbreviated profit and loss account | Undertakings not exceeding the criteria of article 47 LRCS |
| Abbreviated notes | Article 66 LRCS, without the disclosures of article 65(1)(2°) |
| Exemption from preparing notes | Micro-undertaking regime, subject to the information to be shown below the balance sheet |
| Statutory audit by an approved statutory auditor | Two of the three criteria exceeded after two consecutive financial years |
| Supervisory body of a SARL | Mandatory above sixty members |
A newly incorporated company has no two-year history
The repetition criterion does not apply to a newly incorporated Luxembourg company: in the absence of a history of two financial years, the Commission des normes comptables considers that it falls to the company's bodies, at incorporation, to make good faith forecasts.
Those forecasts have a precise object: to determine whether the undertaking will or will not exceed at least two of the three size criteria at the end of its first financial year. They are therefore no formality, since they fix the balance sheet layout, the content of the notes and the prospect of a statutory audit from the very first accounts.
The case that surprises most is a financial participation company incorporated by contribution in kind. The balance sheet total crosses the threshold on day one, with no turnover and no employee: the balance sheet total is then the only criterion exceeded, which, two out of three being required, does not take the company out of the lower category.
We recommend keeping the dated forecast in the permanent file, together with its opening balance sheet assumption. A year later nobody remembers on what basis the first closing was presented, and that is precisely what an inspector challenging the chosen category asks for.
Groups: the consolidation exemption follows the same size criteria
Size thresholds also drive the duty to consolidate in Luxembourg: article 1711-4 of the law of 10 August 1915 exempts a small group from preparing consolidated accounts and a consolidated management report, and the Grand-Ducal Regulation of 25 October 2024 raised its amounts.
The basis of assessment is not the parent company's own accounts. The thresholds for the three criteria are assessed on a consolidated basis, that is on the parent company together with all direct and indirect subsidiaries that would have to be consolidated, and not on an individual basis. A parent with a modest balance sheet can therefore head a group that exceeds.
Article 1711-4(2) opens a simplified method, assessed on gross amounts before consolidation eliminations, in exchange for higher thresholds. Before the increase, the Commission des normes comptables documented a balance sheet total of 20 million euros and net turnover of 40 million euros on a consolidated basis, against 24 million and 48 million under the simplified method.
The expected effect of the increase is that some groups until now classified as large are recategorised as small groups, and so exempted from preparing and publishing consolidated accounts, always subject to the repetition criterion. Scope and methods are set out on our consolidation page.
Three traps we see on size thresholds
Three traps recur on company size thresholds in Luxembourg: out-of-date amounts still online, the balance sheet total of a participation company, and abbreviated notes used where they do not apply.
The first is the easiest to avoid once known. Several guichet.lu pages by legal form, including those for the SARL, the SARL-S, the SA and the société par actions simplifiée, still showed on 11 September 2026 an abbreviated balance sheet conditioned on a balance sheet total of 4,400,000 euros, net turnover of 8,800,000 euros and fifty employees, that is the thresholds in force before the Grand-Ducal Regulation of 25 October 2024. A reader in a hurry applies an obsolete figure in good faith.
The second lies in how the word "two" is read. A participation company whose balance sheet is well above 7,500,000 euros remains a small undertaking as long as it exceeds neither the turnover nor the headcount criterion: a single criterion crossed recategorises nothing. The opposite conclusion, moving to the full layout because the balance sheet is heavy, is common and costs for nothing.
The third is the exception in article 66. The Commission des normes comptables holds that the small-undertaking exemption does not operate for undertakings with a financial preponderance, mainly acquisition or financing participation companies: abbreviated notes do not relieve them of disclosing the participations they hold. It is also one of the points where a change of category shifts the scope of an engagement more than the number of entries, which our pricing reflects.
Sources and verification
Written for Financial Services Luxembourg and reviewed before publication by Mickaël LOC, licensed accountant (authorisation 10077274). The principles, dates, thresholds and references in this article were verified on 11 September 2026 against the official sources listed below.
The doctrine of the Commission des normes comptables supplied the core. Q&A 24/034, on the increase in the size criteria of articles 35 and 47 LRCS and of article 1711-4 LSC, published following the Grand-Ducal Regulation of 25 October 2024, for the Luxembourg option in favour of the maximum levels of 7.5 million and 15 million euros, for the early application option covering financial years beginning on or after 1 January 2023, for the deferred effect of the increase and for the recategorisation expected for certain groups and certain small undertakings. Q&A 19/019, on the interpretation of the repetition criterion in article 36 LRCS, for the wording of article 36(1), for the purpose of the repetition criterion and for the treatment of newly incorporated companies, which owe good faith forecasts. Q&A 22/028, on the small-group consolidation exemption in article 1711-4 LSC, for assessment on a consolidated basis and for the simplified method. Q&A 17/015, for the abbreviated notes of article 66 and the exception covering undertakings with a financial preponderance. On the European side, delegated directive (EU) 2023/2775 of 17 October 2023, consulted on EUR-Lex, for the 25% adjustment of the thresholds in directive 2013/34/EU, for the micro, small and medium-sized amounts and for first application to financial years beginning on or after 1 January 2024. Finally the guichet.lu pages by legal form, SARL, SARL-S, société anonyme, société par actions simplifiée and société en commandite simple, together with the page on supervision of a SARL, for the abbreviated balance sheet conditions as they appear there and for the statutory audit duty.
Four limits must be flagged. The text of the Grand-Ducal Regulation of 25 October 2024 and the consolidated version of articles 35, 36, 47, 65 and 66 of the amended law of 19 December 2002 were not read in their primary source: legilux.public.lu and cnc.lu are unreachable from our drafting environment, and those texts were consulted through indexed extracts. The new figures in article 1711-4 of the law of 10 August 1915 after the increase could not be confirmed: the only verified figures, 20 and 40 million euros on a consolidated basis and 24 and 48 million under the simplified method, are those published by the Commission des normes comptables before the Grand-Ducal Regulation of 25 October 2024. The former micro and medium-sized thresholds were not verified and are therefore not quoted. Lastly, the date on which the guichet.lu pages quoting 4,400,000 and 8,800,000 euros were last updated could not be established. Readers can confirm these points on legilux.public.lu, on cnc.lu and with their approved statutory auditor.
This article states the law as it stands at the date of publication. Thresholds, rules and timetables change, and any decision binding your structure must be checked on the date you rely on it. Report an error to contact@financialservices.lu: the correction is dated in the article.
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