Setting up a Family Office in Luxembourg: Complete Guide

Legal structures for family offices

The SPF (Société de gestion de Patrimoine Familial, Family Wealth Management Company) is exempt from IRC (corporate income tax), ICC (municipal business tax) and VAT, but is reserved for the passive management of financial wealth (no commercial activity). The SOPARFI offers more flexibility: it can hold and manage shareholdings, benefit from the participation exemption regime, and access the network of tax treaties. For real estate assets, a Luxembourg SCI or dedicated structure may complement the setup. The largest families often use a combination of several vehicles.

Services of a family office

• Consolidated wealth management: financial investments, real estate, private equity, art
• Succession planning and intergenerational transfer
• International tax optimisation compliant with regulations
• Family governance: family charter, family council, financial education for heirs
• Consolidated reporting and performance tracking of assets
• Administrative management: accounting, regulatory compliance, corporate secretarial

Why Luxembourg

Beyond tax advantages, Luxembourg offers the strongest political stability in the eurozone (AAA rating), a regulatory framework that protects investors (safety triangle for life insurance), natural multilingualism (French, German, English, Luxembourgish) facilitating relations with families of any origin, and direct access to European capital markets. The setup cost of a single family office ranges between €50,000 and €200,000, with annual operating costs of €100,000 to €500,000.