An LLC in Lithuania is formally known as a UAB — the country’s private limited liability company and its most popular legal form by a wide margin. For foreign founders registering a company in Lithuania, it is the standard way to own an EU company without relocating.
Below is a beginner-friendly breakdown of the Lithuanian LLC: what it is, why founders choose it, how its capital, ownership, management and taxation work, and how it compares with the other legal forms available in the country.
What Is an LLC in Lithuania?
Lithuanian law does not use the term “LLC”. The local equivalent is the uždaroji akcinė bendrovė (UAB) — a “closed” company whose shares cannot be offered to the public: in function, a private limited liability company. In practice, opening an LLC in Lithuania means setting up a UAB, and the abbreviation must even appear in the company’s official name.
It is a separate legal entity governed by the Lithuanian Law on Companies: the company owns assets, signs contracts and answers for its debts in its own name, while the owners’ risk is capped at the capital they put in. Every company is recorded in the public Register of Legal Entities administered by Registrų centras.
Functionally, the Lithuanian LLC corresponds to the German GmbH, the Polish sp. z o.o., the Estonian OÜ or the British Ltd — the same idea of a privately held limited liability structure, adapted to Lithuanian law.
Lithuanian LLC at a Glance
| Feature | Lithuanian LLC |
|---|---|
| Local name | UAB — the Lithuanian private limited liability company |
| Legal status | Separate legal entity; owners are not personally liable for company debts |
| Minimum share capital | €1,000, of which at least 25% (€250) is paid in before registration |
| Shareholders | One or more, fewer than 250 in total — individuals or companies, resident or foreign |
| Management | At least one director (vadovas); no residency requirement |
| Shares | Privately held; cannot be offered to the public |
| Registry | Register of Legal Entities (Registrų centras) |
Advantages of an LLC in Lithuania
Founders rarely pick this form by accident. Compared with both local alternatives and many other EU jurisdictions, the advantages of an LLC in Lithuania are concrete:
- Limited liability. The owners’ personal savings, homes and other assets are legally separated from the company’s obligations.
- Low entry threshold. Just €1,000 of share capital, with only €250 payable before registration — one of the lowest requirements in the EU.
- Full foreign ownership. Shareholders and the director can all be non-residents; no Lithuanian partner or local co-owner is needed.
- Startup-friendly taxation. Qualifying new small companies pay 0% corporate income tax for their first two years of operation.
- EU legal standing. The company is a European Union legal entity that can trade across the single market and work with European clients and banks on equal terms.
How a Lithuanian LLC Works
Three elements define the everyday reality of the form: the capital you put in, the way ownership is held, and the bodies that make decisions.
Share Capital
The minimum share capital is €1,000. At least 25% — so €250 at the minimum — must be paid in before the company is registered; the remainder is due within twelve months. Many founders pay the full amount at once — it avoids extra formalities later, and the money is not a fee: from day one it belongs to the company and can be spent on ordinary business needs.
Owners and Limited Liability
The company can be founded by a single shareholder, and the law allows any number of owners as long as the total stays below 250 — larger shareholder circles require the public AB form. Shares can be held by individuals or legal entities of any nationality — an LLC in Lithuania is fully open to non-residents, and 100% foreign ownership is normal. If the venture fails, shareholders lose at most what they invested: as long as the company was managed lawfully, creditors cannot reach the owners’ personal assets.
Director and General Meeting
Every company has two mandatory bodies: the general meeting of shareholders, which decides the fundamentals — the articles of association, the capital, annual financial statements and profit distribution — and the director (vadovas), who runs day-to-day operations and represents the company in dealings with third parties.
The director may be a shareholder or an outside professional and does not have to live in Lithuania, so the company can be run entirely from abroad. Larger structures can voluntarily add a collegial body (valdyba) or a supervisory council — for a typical owner-managed LLC, the shareholder-plus-director setup is sufficient.
How a Lithuanian LLC Is Taxed
The company pays Lithuanian corporate income tax on its annual profit at a standard rate of 17%. New small companies enjoy meaningful relief: businesses with fewer than 10 employees and annual revenue below €300,000 pay 0% for their first two years of operation and a reduced 7% rate afterwards, provided the statutory conditions are met.
Beyond profit tax, two figures matter for planning: the standard VAT rate of 21% (with registration required once turnover passes the statutory threshold) and a flat 15% on dividends paid out to individual shareholders, resident or foreign. Note that Lithuania taxes company profit every year, regardless of whether it is distributed — so annual profit tax belongs in your financial planning from the first year.
Lithuanian LLC vs Other Legal Forms
The UAB is not the only legal form available in Lithuania — but it is the most universal. The realistic alternatives:
- MB (mažoji bendrija), small partnership. No minimum capital, up to 10 members — natural persons only. Light to run, but poorly suited to corporate investors, licences and outside financing.
- AB (akcinė bendrovė). The public counterpart of the UAB: it may offer its shares to the public, but requires €40,000 of capital and much stricter governance.
- IĮ (individuali įmonė), individual enterprise. The simplest form of all — yet the owner remains personally liable for business debts without limitation.
For most foreign founders the practical choice narrows to LLC versus MB — and the LLC wins whenever the business is expected to scale, take investment, employ staff or deal with banks and regulators.
Who Should Start an LLC in Lithuania?
Rather than thinking in industries, it is easier to check what the form is built for. A Lithuanian LLC is the right choice when a project needs:
- Liability protection. Founders who do not want business risk touching their personal assets.
- Investor-ready ownership. A share-based structure that can admit partners, investors or a foreign parent company later on.
- A credible counterparty. A real EU legal entity for contracts with clients, employees and banks.
- A base for regulated activity. Payment and crypto businesses — including those pursuing a crypto license in Lithuania — operate through this form.
How to Open an LLC in Lithuania
Setting up an LLC in Lithuania is a notarial procedure that non-residents can complete entirely remotely, without travelling to Lithuania. The practical side — routes, documents, prices and timelines — is the subject of a dedicated page: see company registration in Lithuania for the full picture.
Eesti Firma, a licensed corporate service provider, supports foreign founders end to end — from choosing the right legal form to accounting and ongoing support after the company goes live.
Frequently Asked Questions
Yes — that is the point of the form. Provided the company is managed lawfully, its debts stay with the company: creditors can claim the business assets and the paid-in capital, but not the owners’ personal savings or property.
Functionally, yes. A limited liability company in Lithuania is called a UAB: local law does not use the term LLC, but the form offers the same essentials — separate legal personality, limited liability and privately held shares.
One or more — the law only requires that the total stays below 250. Both individuals and companies can hold shares, and a business that reaches that ceiling must convert into a public AB.
No. The director can be a non-resident — the founder personally, a co-shareholder or an outside professional — and manage the company from abroad.
An LLC (UAB) is a share-based company with €1,000 minimum capital that can be owned by individuals and companies alike. An MB, or small partnership, has no capital requirement but is limited to 10 members who must all be natural persons, and it copes poorly with investors and licences.
Yes. A single founder can register an LLC in Lithuania alone, hold 100% of the shares and act as the director — a very common setup among solo entrepreneurs and small foreign-owned businesses.
