In this article, you will learn:

• what the start-up aid is actually intended for;

• which companies are eligible (and which are not);

• which criteria apply to the managing director and shareholders;

• which technical points are often misunderstood;

• how to submit the application correctly.

What is the aid really for?

“The start-up aid for first-time business creation is frequently misunderstood. It is neither a salary, nor a replacement allowance, nor compensatory income for the entrepreneur. It is financial support granted to the business, intended to cover operating and start-up costs during the first months of activity. The distinction is essential: this aid strengthens the economic structure of the new business; it does not replace personal income.”
— Guylaine Marchi Hanus, Founder of EIS, shares.

What does the aid consist of?

The aid is capped at a maximum of €12,000, paid in up to six monthly instalments of €2,000. It is granted to a newly established micro-enterprise in Luxembourg, subject to strict compliance with the conditions set out by law. The application must be submitted within six months from the date indicated on the business permit (autorisation d’établissement). This date is the sole official reference.

1) Conditions related to the business

Eligible activity

The business must carry out an activity covered by the right of establishment, within one of the following sectors:

• trade / commercial services;

• skilled crafts (artisan professions).

The business must:

• employ fewer than 10 persons;
• generate annual turnover or a total balance sheet not exceeding €2 million.

Newly established business

The business must:

• have been legally established for less than six months;

• not result from the takeover of an existing business activity.

Good to know: businesses created through a takeover are not eligible.

Dedicated business premises

This point is often underestimated.

Even if the business permit has been granted, the business must have operating premises suited to the nature of the activity. A simple registered office at the director’s private residence is not sufficient.

The business must have:

• either its own commercial premises with a valid lease agreement;

• or, either a fixed desk or a private office within a coworking space or business center, supported by a clear service agreement covering at least the entire duration of the aid period.

2) Conditions related to the managing director and shareholders

The criteria are strict.

The main managing director and their shareholders:

• must not have held a business permit in Luxembourg within the past 10 years:

  • neither in their own name;

  • nor as a company directors;

  • for the same activity or any other activity;

• And, must no have been acting as entrepreneurs in Luxembourg or abroad within the past 10 years;

In addition, they:

• must not hold more than 25% of shares in another company (in Luxembourg or abroad);

• must not receive any income other than that derived from the entrepreneurial activity.

This notably excludes: salary, retirement or disability pension, unemployment benefits, REVIS (social inclusion income), and any replacement income in Luxembourg or abroad.

Therefore, the activity must be carried out on a full-time basis. This scheme does not apply to side businesses.

Specific cases

Students receiving a study grant may in principle be eligible when creating their first business.

However, spin-offs from the University of Luxembourg Incubator are not eligible, as they already benefit from specific public support.

3) Business management training

An accelerated business management training course is required.

It is organized by training centres affiliated with the Chamber of Commerce and the Chamber of Skilled Trades and Crafts.

Both programmes follow the same official framework. To register, contact the House of Entrepreneurship (trade) or the Contact Entreprise (craft sector).

It should be noted that the ADEM “StartYourBusiness” programme, dedicated to future entrepreneurs registered with this employment agency, also grants access to the aid, based on a certificate of participation.

Possible exemptions:

• a university degree directly related to business management;

• a master craftsman diploma (which generally includes management modules).

If an exemption from the business management training requirement is requested, it is advisable to provide a copy of the relevant diploma and, where possible, a detailed description of the curriculum outlining the management-related courses completed.

4) Submission of the application and supporting documents

The application must be submitted online via the secure platform MyGuichet.lu, using a LuxTrust product (or another authentication method accepted by the platform, depending on availability).

The file must include all required supporting documents.

The detailed and updated list of documents to be provided is available on the official Guichet.lu page dedicated to the start-up aid for first-time business creation.

Applicants are advised to review the list of mandatory supporting documents carefully before submission to avoid processing delays or rejection.

5) Maintaining eligibility during the aid period

Throughout the entire aid period, the situation of the business, the managing director and the shareholders must remain unchanged.

In the event of a substantial modification (taking up salaried employment, change in shareholding structure, modification of activity, etc.) or false initial declaration, the Ministry of the Economy may request repayment of the aid.