Business Operation Costs
Lithuania has an attractive tax system, characterized by low and flat taxes. Both private and corporate incomes are taxed at flat rates.
More information about taxes here.
As of 2010, group taxation of corporate profit has been introduced. This allows groups to balance profits and losses within them, whereby losses can be transferred among different entities of a group if the controlling entity holds at least 2/3 of the shares of the controlled entity.
Among other favorable conditions of corporate profit taxation in Lithuania are the following: entities can reduce taxable profit if they are carrying out an investment project into new technologies; expenses incurred by companies carrying out R&D projects can be deducted thrice; 10% withholding tax on interest has been abolished for companies resident in the European Union.
To start business in Lithuania, one of the two ways can be followed: to do business as an individual, or to establish a legal entity. The decision as to which way to follow depends on a number of circumstances. If you decide to establish a legal entity, you will have to complete a procedure of 7 steps, which will take approximately 15 working days.
| Procedure | Time to Complete | Cost to Complete |
| Draft founding documents: a founding act (when there is one founder), or a founding contract (when there are two or more founders), bylaws, and minutes of the statutory meeting. | 1-3 days | EUR 0-290 |
| Open a bank savings account with minimum capital (if needed) and get a bank certificate proving the availability of the funds. | 1 day | EUR 0-5 |
| Notarize the founding act / contract / bylaws / application for the registration of the private limited liability company at the State Enterprise Centre of Registers. | 2 days | EUR 58-260 |
| Register the company at the State Enterprise Centre of Registers, including registration with State Tax Inspectorate (the Lithuanian Revenue Authority) as payer of corporate tax and contributions to State Social Insurance Fund Board (SODRA). | 3 days | EUR 31-57 |
| Register as a VAT payer. | 3 days | No charge |
| Change the bank savings account into the settlement account (to handle normal commercial transactions). | 1 day | No charge |
| Obtain the official seal of the company. | 2 days | EUR 9-26 |
Certain types of legal entities, such as an individual enterprise, private limited liability company, association, public institution, or a limited partnership can be founded electronically as well, submitting documents directly to the Registrar through the self-service e-system of the State Enterprise Centre of Registers. Certain requirements must be met in order to start a company this way; however, registration process is shorter, and founding costs are lower.
| Procedure | Time to Complete | Cost to Complete |
| Obtain an electronic signature. Temporarily incorporate the name into the Register of Legal Entities. Open a bank savings account with minimum capital (if needed). |
1 day | EUR 0-27 EUR 16 EUR 0-5 |
| Register a company at the State Enterprise Centre of Registers, by drafting and signing founding documents at the e- system of the State Enterprise Centre of Registers. | 3 days | EUR 31-57 |
| Register as a VAT payer. | 3 days | No charge |
| Change the bank savings account into the settlement account (to handle normal commercial transactions). | 1 day | No charge |
| Obtain the official seal of the company. | 2 days | EUR 9-26 |
