SARL Manager in Luxembourg: Obligations and Liabilities

Civil and criminal liability

The manager is liable to the company and third parties for the management misconduct they commit in the exercise of their duties. This liability is personal and may put their private assets at risk. The most common cases include: continuing a loss-making activity without taking the necessary measures, non-compliance with legal obligations (annual accounts, tax returns, CCSS), distribution of fictitious dividends, and undeclared conflict of interest. In the event of bankruptcy, the manager may be ordered to cover the corporate liabilities if management misconduct contributing to the shortfall of assets is proven.

Accounting and tax obligations

• Keep the company's accounts in accordance with the Luxembourg PCN
• Prepare the annual accounts within 6 months of the end of the financial year
• Convene the annual general meeting for approval of the accounts
• File the annual accounts with the RCS via eCDF within 7 months
• Ensure payment of taxes (IRC, ICC, VAT) and social contributions (CCSS) on time
• Update the Register of Beneficial Owners in case of change

Manager remuneration

The remuneration of the SARL manager can take several forms: salary (if employment contract with subordination link), tantièmes (share of profit allocated by the general meeting) or a combination of the two. The majority shareholder manager is registered with the CCSS as self-employed (contributions ~25% of income), unless they demonstrate a subordination link with the company. The salaried manager benefits from the employee social security regime. The remuneration must be reasonable and justified by the responsibilities exercised, at the risk of tax requalification.