Capital city:                Luxembourg City 
Currency:                    Euro (€)         
Population:                576,249 (2015)
Language:                  French, German & Luxembourgish 
GDP                             $58 b USD (2016)

Luxembourg (officially the Grand Duchy of Luxembourg) is a landlocked small sovereign state bordered by Belgium, Germany & France. Luxembourg City is one of the three official capitals of the European Union and the seat of the European Court of Justice (the highest juridical authority in the EU). As a representative democracy with a constitutional monarch, it is headed by a Grand Duke, Henri, Grand Duke of Luxembourg (and is the world’s only remaining grand duchy). 

Luxembourg is a developed country, with an advanced economy and the world’s highest GDP per capita (according to the United Nations in 2014). Luxembourg is the world’s second largest investment fund centre (after the US), the most important private banking centre in the Eurozone and Europe’s leading centre for reinsurance companies. The Luxembourg government has aimed to attract internet start-ups, with Skype and Amazon being two of the many internet companies that have shifted their regional headquarters to Luxembourg.

Luxembourg is ranked as the 2nd safest tax haven in the world, behind Switzerland.  As a tax haven Luxembourg does not tax the interest gained by offshore bank accounts. A Luxembourg Holding Company is a resident company in the tax haven of Luxembourg which operates subsidiaries. 

The Luxembourg holding company has the following benefits:

  • Permitted to carry out offshore activities.
  • Exempted from paying taxes on dividends.
  • Exempted from paying withholding taxes if the beneficiary is another Luxembourg holding company or a company incorporated in the European Union.
  • Exempted from paying capital gains tax.
  • No need to declare to the authorities who the beneficial owners of the company are.  

Further details are available at Luxembourg For Finance.

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"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"

- Bono: U2