F.A.Q

The S.à r.l.-S is the simplified form of the former Private Limited Liability Company, under the name S.à r.l. 

It provides the opportunity for an entrepreneur to create a company with a minimum share capital of only 1 euro, thus enabling even those with limited initial capital or those willing to start only a small business to do so.

Share Capital: An S.à r.l.-S can be established with capital ranging from €1 to €11,999, whereas a traditional S.à r.l. requires a minimum of €12,000.

Formalities: Although an S.à r.l.-S has fewer formalities in its initial setup, the legal and administrative obligations after incorporation largely align with those of a regular S.à r.l.

Business Scope: The S.à r.l.-S is typically aimed at entrepreneurs and small businesses in their early stages, whereas the standard S.à r.l. may be better suited for larger projects right from the start.

Unlike the traditional S.à r.l., an S.à r.l.-S may be incorporated under private seal, so it is not always mandatory to involve a notary. 

However, there may be circumstances (e.g., the nature of the business activity or the founders’ preference for a notarial deed) where it is advisable or required to have a notary authenticate the articles of association.

Limited Capital: The capital ceiling of €11,999 might restrict access to certain funding opportunities (banks, investors, etc.).

Similar Obligations to a Traditional S.à r.l.: Despite simplified incorporation, the company must comply with nearly all of the standard accounting and administrative requirements of a regular S.à r.l.

Dividend Restrictions: Until the capital reaches €12,000 (achieved through accumulating profits in legal reserves), the distribution of dividends may be limited.

As with any Luxembourg company, the S.à r.l.-S must:

• Maintain Proper Accounts in line with Luxembourg accounting standards (Lux GAAP) or, in certain cases, IFRS.
• File Annual Financial Statements with the Luxembourg Trade and Companies Register (depending on company size thresholds).
• Comply with VAT and Other Tax Requirements, including corporate income tax and any relevant taxes on profits.
• Prepare Year-End Accounts and file an annual tax return, even if business activity is minimal.

Yes. You can convert an S.à r.l.-S into a classic S.à r.l. This typically occurs when the business grows, the share capital exceeds €11,999, or the company needs the more flexible structure of a full S.à r.l. Conversion usually involves a notarial deed and updating the articles of association to reflect the new legal form.

Share Capital: From €1 to €11,999.
Administrative Fees: Registration with the Trade and Companies Register (RCS), filing fees, and document preparation can range from a few dozen to a few hundred euros.
Optional Notary Fees: If you choose to have the articles of incorporation notarized.
Professional Advisory Fees (optional): Costs for legal, accounting, or administrative consulting, such as drafting the articles, business domiciliation, or other specialized services.