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Start of business
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Start of business


Forming a clear vision for the start of your business is perhaps the most important step to start with. The vision will help you decide which type of business entity is the most appropriate to choose from – pursuong self-employment or establishing a legal person. To facilitate the decision making, you might need to evaluate the following criteria:

  • Character of activity. The specific activities you plan to carry out, that is, the decision, depends on the complexity, size and other circumstances specifically related to the operational activities of your business.
  • The amount of available capital. To establish certain types of legal persons, the founder of the legal entity is required to meet the requirements set for a specific amount of authorized capital.
  • Tax implications. The amount of the taxes payable directly depends on the form of activity chosen by the person in question.
  • Degree of liability. If a person intends to limit his/her liability and chooses not to assume liability for the obligations in the case of business failures including own or family assets, he/she should choose a limited liability legal entity.
  • Number of founders. If there are several and more stakeholders wishing to engage in a particular activity together, business activities should be pursued by establishing a legal entity.
  • The complexity of business activities. Being self-employment is easier, that is, you do not need to create a legal person management structure, or go through other formalities essential for other legal entities.


If a decision has been made to establish a company, what type of company should it be?

If you decided to set up a company, first assess and choose the legal type of an undertaking which is the most appropriate to implement the identified goals.

According to the degree of liability of legal persons (LP), they are divided into those of limited and unlimited civil liability. The participant of a legal person undertakes unlimited civil liability obligations to the extent of his owned assets or assets held by the trust. If a legal person is established as a limited liability company, its   participant is not responsible for any obligations.

In relation to the pursued objective, legal persons may be grouped into public and private. Public and private legal persons usually differ according to their founders’ objectives (meeting public (not seeking benefit for themselves) or private (seeking material gain) interests, type of activity and use of profit (participants of private legal persons have the right to participate in the profit, whereas the profit of public legal persons may only be used for operational objectives).

The most popular types of company (forms of incorporation), having the status of a legal person, permitted to operate in the Republic of Lithuania:

  • A one-man company/sole proprietor enterprise (individual enterprise) (IE)
  • A public (limited liability) company (AB)
  • A private (limited liability) company (UAB)
  • Association
  • Charity fund
  • Public body/authority
  • Agricultural company (ZUB);
  • Limited partnership (KUB)
  • Collective/General partnership (TUB)
  • Local/public budgetary enterprise
  • Local/State enterprise
  • Housing cooperative
  • Small partnership


Procedures for starting a business

Business registration

To acquire a certificate of self-employment (individual activity), one should submit to the State Tax Inspectorate a completed application form to register the form REG812. Data and documents can be submitted to the tax authorities, on arriving at the tax office in person, by mail or e-mail.

A certificate of self-employment is issued within 10 working days of the application submission date.

This certificate is issued for an indefinite period of time. However, at the end of the tax period you are required to submit an annual income tax return to the county state tax inspectorate and pay personal income tax on the earnings from self-employment during a calendar year.

In order to acquire a business license, you first need to check whether your business certificate can be issued for the chosen activity. A list of activities  one can undertake under a business license is approved by the Government Resolution No 1797 ‘On the Rules concerning the Issuance of Business Licenses to Residents‘, approved by the Government of the Republic of Lithuania on November 19, 2002“ (in Lithuanian). The type and subtype of activities chosen can determine the amount of the fee to be paid for a business license. The amount payable depends on the duration of a business license as well.

The documents to be submitted to the territorial state tax inspectorate (appearing in person at the tax office in person, by mail or e-mail) are the following:

  • an application for a business license;
  • an identity document;
  • other documents required in individual cases (a document on the basis of which a smaller amount of income tax may be applied as established by a municipal council, a royalty-bearing license agreement concluded with the producers of audiovisual works and phonograms, etc.).

Business license is issued within 4 working days from the date of submitting an application. More detailed information about business licenses and self-employment certificates is available here.

Establishment of companies covers the process from the decision to establish a legal person of a certain legal form (hereinafter referred to as LP) to its registration in the LP register. One can distinguish several stages of business start-ups, characteristic of any legal form of LP):
Setting business performance goals and objectives;

  1. Identifying the most appropriate option of a legal form (type), based on the activities to be undertaken;
  2. Choosing office premises; getting the consent of the property owner to provide facilities to the LP office (notarised), if the owner of the premises is not the founder;
  3. Selecting the name of a legal person and registering it. You can submit a request to the Registrar of Legal Persons for a temporary inclusion of the name in the Register of Legal Person (JAR-5);
  4. Drawing up an incorporation document (Incorporation Act if the company is established by one person, Incorporation Agreement if if the company is established by more than one person);
  5. Opening of a savings account. The founders have the right to choose the bank. The persons authorized by the legal person, when opening of a bank account on behalf of the legal person, must have an identity document and an incorporation document (Incorporation Agreement or Incorporation Act). After the legal person has been registered, a savings account is converted into a current account (upon submission of a legal person’s registration certificate, a document certifying the appointment of the legal entity’s manager, the manager’s identity document and a stamp of the legal entity);
  6. The required payment of initial contributions (where provided for). Initial contributions shall be paid only in cash into the savings account;
  7. Drafting the Statutes (Articles of Association), which serves as a guidance document to the legal entity during its future activities;
  8. Convening the Constituent assembly, which approves the Statutes, elects management and supervisory bodies (head, board, council, etc.), grants authorisation to represent the legal entity in question in the Register of Legal Entities. If there is one founder, the only founder’s decision is drawn up. Constituent Assembly may not be convened if the Incorporation Agreement or Incorporation Act specifies the management bodies and the authorized persons representing the legal entity in question;
  1. Filling out the JAR forms necessary for the Register of Legal Entities (JAR-1, etc., depending on the legal form/type);
  2. Submission of documents to the notary and the Register of Legal Entities

Depending on the legal form of a company, the founder may only be a natural person having the legal capacity or both a natural person, and a legal person (JA).

Standard instruments for starting up sole proprietorships (individual enterprises), private companies, small  partnerships and other legal entities are available on the website of the Ministry of Economy of the Republic of Lithuania: (examples in Lithuanian) and more information in English here.

Information on starting up a business, the documents to be filled out and submitted to the notary public and Register of Legal Persons is also available on the website of the Public Institution Centre of Registers: On this website, you can also find and fill out all the JAR forms necessary for the Register of Legal Persons (Jar). (Phone number of the Advisory Service under the Register Centre is (+370) 5 268 8262, helpline 1637).

It is important to be aware of the following:

Company registration in the Taxpayers’ Register.  A legal person is automatically registered in the Taxpayers‘ Register, that is, the Register of Legal Persons forwards the information to Taxpayers‘ Register. This means that one need not appear in person at the State Tax Inspectorate in person. STI informs about the registration in the Taxpayers’ Register and requests to provide additional information (if necessary).

Registration as an insurance payer. A registered company automatically becomes the payer of state social insurance contributions (an insurance payer). When a company is registered as a taxpayer, it is automatically registered as an insurance payer, and the company-related data is communicated to the State Social Insurance Fund Board. This means that you need not appear in perseon at the local office of the State Social Insurance Fund Board in person.

Opening a company bank account. Legal acts do not provide for a specific period of time during which you have to open the company’s bank account. A savings account opened by public (AB) and private companies (UAB) during the incorporation of the companies having these legal forms, shall be the company’s bank account.

Licences and permits. Some economic commercial activities may be carried out only upon acquisition of the appropriate license or permit. If the legal acts covering your planned activities provide for this requirement, do not hesitate to contact the competent authorities empowered to grant licenses/permits or the Point of Single Contact for Services and Products  (PSC).

Work safety certificate. You have to prepare for Occupational Safety and Health (OSH) certification (in a training institution or on your own) and pass the examinations. Upon completion of certification pocedure you will be issued a work safety certificate, which is a mandatory requirement for company managers and some professionals.

Company stamp. Stamps are only mandatory for those authorities which are entrusted with state or local government functions. Documents of legal persons do not have to be stamped, unless the requirement to have a stamp is laid down in the incorporation documents or the legislation in force.


More detailed information about incorporation of a company, the first steps and the steps to be taken after the company has been established is available on the information portal of the Public enterprise Enterprise Lithuania’: and .

Information prepared on the basis of the Public enterprise Enterprise Lithuania’ material.

Reviewed: 2018-01-12

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