What corporate support schemes does Luxembourg offer?

Looking to upgrade your equipment, hire more staff, export your products, digitalise your company – or perhaps invest in reducing your environmental footprint? Luxembourg offers a range of financial support measures designed to help businesses achieve their goals. Here we explore just some of the forms of assistance available.

The Grand Duchy provides a pro-business environment; as well as economic dynamism and an international outlook, the country offers targeted financial assistance for businesses. This support is granted subject to conditions and – normally – upon request. It comes in different forms (loans, guarantees, subsidies, etc.) and varies depending on the size of the business, activity, and type of project in mind.

Help with launching a business

Launching a business can be a costly affair, depending on the nature of its activities. As well as taking advantage of bank loans, entrepreneurs can apply for a loan from the Société Nationale de Credit et d’Investissement (SNCI): this might be for launching or acquiring a business, investment, innovation, etc. Start-ups can also turn to the Mutualité de Cautionnement, the SME Mutualité, or microfinance institutions to obtain support or bank guarantees.

Another interesting alternative is to seek funding from external investors such as business angels or investment funds. The support available to fledgling firms is explored in greater depth in the article Funding your start-up in Luxembourg.

Small and medium-sized enterprises based in Luxembourg are entitled to special assistance designed to help them boost their competitiveness and enhance their performance.

Assistance for SMEs

Small and medium-sized enterprises (SMEs) based in Luxembourg are entitled to special government assistance designed to help them boost their competitiveness and enhance their performance. Provided it meets the eligibility conditions, the business may receive a loan, capital grant, subsidy, repayable advance or interest relief.

Financial assistance can include payment of a portion of the costs of investing in the creation or expansion of a production process, upgrading of equipment, etc. It may cover a portion of the costs related to the use of a service provided by external consultants, or incurred as a result of attending a trade fair for the first time. Government will also intervene to remedy the damages caused by natural disasters. Read myLIFE for information about the main types of assistance available for SMEs in Luxembourg.

Help with hiring

Businesses wanting to expand their team can also benefit from government financial assistance. This applies when hiring a job-seeker who has been out of work for a long time, an unemployed person over the age of 45 or under 30, a person who is retraining, a disabled person, etc.

Depending on the situation, the employer will receive a tax credit, reimbursement of a portion of the gross salary of the person they have hired, exemption from employer social security contributions, or, in the case of disabled employees, reimbursement of a portion of the cost of specific expenses such as training fees, workstation adaptation.

To find out more about existing support and eligibility conditions, visit the ADEM website.

Useful info: When hiring a highly qualified, specialised worker, an employer who has paid the cost of that person’s relocation, accommodation or travel can deduct these costs and claim them as operating expenses (subject to conditions).

Assistance with training costs

Companies can benefit from the co-funding of their annual investment in continual vocational training for their employees, including language, IT and management training. The contribution amounts to 15% of the cost of investment and applications should be submitted to the INFPC (national institute for the development of continuing vocational training). In addition, the Ministry of Labour, Employment and the Social Economy provides subsidies for company employees who learn the Luxembourgish language.

Also, ADEM provides financial incentives to employers who take on an adult apprentice. Depending on the situation, this will take the form of a reimbursement of the additional compensation, of a portion of the apprenticeship allowance, or of the employer’s social security contributions.

Luxinnovation’s Fit4 programmes are aimed at boosting the innovative capacity and competitiveness of companies by providing them with finance and advice focusing on digitalisation, innovation and sustainability.

Support for research, development and innovation

Companies working in the field of research, development and innovation can likewise obtain specific assistance with the following: technical feasibility studies, research and development programmes (experimental development, fundamental and industrial research, etc.), investment in innovative start-ups or SMEs, research infrastructures, centres of innovation, etc.

This can take the form of subsidies, recoverable advances, interest rebates, the provision of equity, guarantees, as well as loans.

Assistance for protecting the environment

Environmental protection is encouraged by the Ministry of the Economy, which provides investment assistance in the field of environmental technology and environmentally friendly processes such as expenditure on energy efficiency measures, the promotion of renewable energy, recycling and waste reuse.

The amount of assistance available ranges from 10% to 100% of the investment and takes the form of capital subsidies, recoverable advances, interest rebates, guarantees and loans. A guide to assistance with environmental protection is available on the government website.

Useful info: Companies wishing to invest in electric vehicle charging infrastructures may be entitled to help with covering a portion of the installation costs.

Businesses looking to expand internationally can obtain export subsidies from the Office du Ducroire Luxembourg (ODL).

Assistance with internationalisation

Businesses looking to expand internationally can obtain export subsidies from the Office du Ducroire Luxembourg (ODL). The ODL provides financial contributions to international marketing and exhibition costs, including graphic design and translation of marketing material, exhibiting at trade fairs, events and conferences abroad, brand registration costs, patenting and certification, traditional advertising, digital marketing, legal and tax consulting services, as well as market research. Subsidies vary between 10% and 50% of the expenses incurred. For more information on subsidies and eligibility conditions, visit the ODL website.

Assistance with investment at regional level

Businesses wishing to invest in a project in the communes of Dudelange, Bettembourg, Wiltz, Winseler or Kiischpelt can also benefit from subsidies. Projects must be shown to have a specific regional interest, have an impact on the economic development of the region, or contribute to greater geographical distribution of economic activity. This support will be granted for investments in tangible or intangible assets, but also for salary costs related to job creation.

It is important to note that the eligibility conditions for this financial support can vary depending on the field of activity, size of company, and proposed plans. Before proceeding, businesses must obtain information from the organisations concerned to ensure they meet all mandatory criteria.

More information is available at Guichet.lu or by using the search tool provided on the Chamber of Trades website. Good luck with achieving your goals!