EU Inc is a proposed EU regulation, not law: the Council agreed its mandate on 23 October 2026 and Parliament has not voted. Once it applies, an EU Inc will register in one Member State and pay that state's tax. In 2026 the Netherlands taxes profit at 19% up to EUR 200,000 and 25.8% above, Luxembourg City at 23.87% combined, Belgium at 25% or 20% on the first EUR 100,000 for qualifying SMEs. The Netherlands suits modest profit and holdings from 5%, Luxembourg suits investor holdings, Belgium suits option-heavy teams based there. Choose the country now and form a national company that can convert.
An EU Inc is European on the label and national underneath
The European Commission wants a single company form, EU Inc, that founders could register online in any Member State and use across the Union. It promises no minimum capital, online share transfers and an EU employee stock option. It is still a proposal; our EU Inc hub tracks the file.
What the proposal does not do matters more for this note. An EU Inc is registered in one Member State. That state's accounting law, employee participation rules and, above all, its tax system apply. The proposal says plainly that it does not harmonise taxation. So the label is European, but an EU Inc in Luxembourg pays Luxembourg tax and an EU Inc in Rotterdam meets the Dutch works council.
So 'where should I register my EU Inc?' is the question founders already ask about a B.V., an S.à r.l. or an SRL. Pick the country now, form a national company there, and convert later.
19% / 25.8%
Corporate tax 2026, threshold EUR 200,000.
23.87%
Luxembourg City, combined, larger profits.
25% / 20%
20% on the first EUR 100,000 for SMEs.
Proposal
Council mandate 23 October 2026; Parliament has not voted.
One registration, national rules for the rest
The Commission published its proposal on 18 March 2026 as COM(2026) 321, a regulation based on Article 114 TFEU. On 23 October 2026 Coreper agreed the Council's mandate for talks with Parliament. Parliament's legal affairs committee postponed its vote on 8 October for lack of a majority on employee co-determination, and as of 11 November 2026 no committee or plenary vote has taken place. With application 12 or 21 months after entry into force, first registrations are a 2028 event at the earliest, on our reading.
An EU Inc acquires legal personality on registration in the register of the Member State of its registered office, and a designated national form fills the gaps. So the following depend on where you register.
| Matter | Decided by | What the texts say |
|---|---|---|
| Corporate tax and tax residence | National law | No harmonisation; Council keeps national residence, anti-abuse and exit tax rules |
| Annual accounts and audit | Registration state | Accounting law of the registered office state (Article 105) |
| Employee participation | Registration state | Commission: registration state; Council: host-state option for branches; Parliament draft: strictest regime |
| Formation checks | Registration state | Council allows refusal or delay on anti-money laundering and criminal grounds |
| Language of the articles | Registration state | Official language plus a language customary in international business |
| Gap filling | National form | The national form each state designates (Article 4) |
Two points give some freedom. The registered office and the central administration or principal place of business must be in the Union, but the text does not say in the same Member State. And directors must be natural persons, at least one living in the EU, not necessarily in the registration state. The Council adds a power against wholly artificial arrangements, and tax offices will test letterbox registrations.
Law and practice: COM(2026) 321 final, procedure 2026/0074(COD), Articles 4, 5, 7(4), 9, 12, 42(2), 105 and 109; Council mandate, document ST 14376/26 of 19 October 2026, Articles 12(2a) to (2d), 14(2), 79 and 103a; European Parliament Legislative Observatory, 2026/0074(COD).
Luxembourg, the Netherlands and Belgium in ten rows
The table applies today's national law to an EU Inc registered and managed in each country. It is how a B.V., S.à r.l. or SRL is treated now, and on the current texts how an EU Inc would be.
| Point | Netherlands | Luxembourg | Belgium |
|---|---|---|---|
| Corporate tax 2026 | 19% to EUR 200,000; 25.8% above | 23.87% combined in Luxembourg City on larger profits; lower bands below EUR 200,000 | 25%; 20% on the first EUR 100,000 for qualifying SMEs |
| Participation exemption | Dividends and gains, from 5%, no holding period | From 10% or EUR 1.2 million (EUR 6 million for gains), 12 months | 100% dividends-received deduction and exempt gains, from 10% or EUR 2.5 million, one year |
| Dividend withholding | 15%; 0% to EU and treaty parents from 5% | 15%; 0% to qualifying parents from 10% or EUR 1.2 million, 12 months | 30%; 0% to EU and treaty parents from 10%, one year; VVPRbis 18% from 1 July 2026 |
| Extra withholding | 25.8% conditional tax to affiliates in listed low-tax states | None comparable | None comparable |
| Net wealth tax | None | 0.5% of net wealth; minimum EUR 535 to EUR 4,815 | None on companies |
| Employee participation | Works council from 50; structure regime for large companies | Staff delegation from 15; board seats in an SA from 1,000 | CPPT from 50; works council from 100 |
| Employee options | Taxed when shares become tradable; 2027 start-up regime proposed | General wage tax rules | Warrants taxed at grant on a lump sum |
| Accounts filing | KvK, at the latest 12 months after year-end | RCS, 7 months after year-end | National Bank, at the latest 7 months after year-end |
| Language of administration | Dutch; English widely used by banks and advisers | French, German, Luxembourgish; English common in finance | Dutch, French or German by region |
| Bankability | Strict but predictable onboarding | Used to foreign owners; slow onboarding | Domestic banks focus on Belgian businesses |
No column wins every row. The Netherlands is cheapest on modest profit with the lowest holding threshold. Luxembourg knows foreign owners and investor structures best but adds a wealth tax floor. Belgium has the friendliest option timing and the latest works council, but the highest headline rates.
Law and practice: Netherlands: Corporate Income Tax Act 1969, Articles 13 and 22; Dividend Tax Act 1965, Article 4; Withholding Tax Act 2021. Luxembourg: Income Tax Law (LIR), Articles 147, 166 and 174; Net Wealth Tax Law, § 8. Belgium: Income Tax Code 1992, Articles 202 to 205, 215 and 269; Programme Law published 1 June 2026. Rates as used on our Benelux tax rates page.
What each country takes from your profit in 2026
Netherlands. Corporate income tax is 19% on the first EUR 200,000 of taxable profit and 25.8% above. The rates and the bracket did not change for 2026, and the 2027 tax plan keeps them.
Luxembourg. Corporate income tax is 16% on profit above EUR 200,000, plus a 7% solidarity surcharge on that tax and municipal business tax, 6.75% in Luxembourg City. Combined: 23.87%. Below EUR 175,000 the income tax rate is 14%, with a transition band up to EUR 200,000, and companies get a EUR 17,500 allowance for municipal business tax. A budget bill tabled on 7 October 2026 proposes a cut to 15%, 22.80% combined, from 2027. It still has to pass.
Belgium. The standard rate is 25%. A qualifying small company pays 20% on the first EUR 100,000. The company must be small, other companies may not hold half or more of its shares, and at least one director must receive a minimum remuneration, or the taxable profit if lower. The minimum rises from tax year 2027 and is indexed, so check the current amount. New companies are exempt from the pay condition for four financial years.
| Taxable profit | Netherlands | Luxembourg City (simplified 23.87%) | Belgium, SME rate | Belgium, standard |
|---|---|---|---|---|
| EUR 80,000 | EUR 15,200 | EUR 19,096 | EUR 16,000 | EUR 20,000 |
| EUR 250,000 | EUR 50,900 | EUR 59,675 | EUR 57,500 | EUR 62,500 |
| EUR 1,000,000 | EUR 244,400 | EUR 238,700 | EUR 245,000 | EUR 250,000 |
The Luxembourg column applies 23.87% to the whole profit to keep the comparison simple. With the lower bands and the municipal allowance the real figure is lower for smaller companies: about EUR 16,200 on EUR 80,000 and about EUR 58,500 on EUR 250,000. Other communes have different municipal rates.
Three founders expect taxable profit of EUR 250,000 in their third year. In the Netherlands the company pays 19% on EUR 200,000 and 25.8% on EUR 50,000: EUR 50,900, an effective 20.4%. In Luxembourg City it pays about EUR 58,500 once the allowance is counted. In Belgium, if it meets the SME conditions, EUR 20,000 on the first EUR 100,000 and EUR 37,500 on the rest: EUR 57,500.
Corporate tax alone rarely decides the country. From about EUR 700,000 of profit the order flips: Luxembourg's 23.87% beats the Dutch 25.8% at the margin, and from 2027 the gap could widen if the bill passes.
Law and practice: Corporate Income Tax Act 1969, Article 22; Belastingdienst, 'Veranderingen vennootschapsbelasting 2026'. LIR, Article 174; PwC Worldwide Tax Summaries, Luxembourg, corporate income taxes; Luxembourg budget bill no. 8800 of 7 October 2026. Income Tax Code 1992, Article 215 (reduced rate and director pay condition).
Participation exemption, withholding tax and the Luxembourg wealth tax
If the company will own subsidiaries or pay investors, the holding rules can matter more than the headline rate.
Netherlands. The participation exemption covers dividends and capital gains from a stake of 5% or more, with no minimum holding period. Outgoing dividends carry 15% withholding tax, reduced to nil for an EU, EEA or treaty-country parent holding at least 5%, if the structure is not abusive. Since 1 January 2024 a conditional withholding tax at the top corporate rate, 25.8% in 2026, applies to dividends paid to affiliated companies in jurisdictions on the Dutch low-tax list.
Luxembourg. Dividends and gains are exempt where the company holds at least 10%, or shares that cost EUR 1.2 million for dividends and EUR 6 million for gains, for 12 months, in an EU company covered by the Parent-Subsidiary Directive or a non-EU company taxed at a comparable rate. Withholding on outgoing dividends is 15%, and nil for a qualifying corporate owner in the EU or a treaty country under the same 10% and 12-month tests. Luxembourg also charges net wealth tax: 0.5% on net wealth up to EUR 500 million. Qualifying participations are generally exempt, so a pure holding usually pays only the minimum: EUR 535 for a balance sheet up to EUR 350,000, EUR 1,605 up to EUR 2 million and EUR 4,815 above, under the rules since 2025.
Belgium. A qualifying dividend is first included in profit and then deducted in full under the dividends-received deduction. The stake must be 10% or have an acquisition value of EUR 2.5 million, held for at least one year. Since 2025 a holding that is not small and relies on the EUR 2.5 million test must also hold the shares as financial fixed assets. Gains on qualifying shares held a year are exempt. Withholding on outgoing dividends is 30%, nil for an EU or treaty parent holding 10% for a year. For Belgian individual shareholders, VVPRbis shares carry 18% instead of 30% on dividends paid from 1 July 2026, up from 15%.
Founders in Spain want a holding owning 100% of a German GmbH that pays EUR 500,000 a year. In all three countries the dividend arrives exempt, provided the holding has real substance. Luxembourg adds the minimum net wealth tax, EUR 4,815 above a EUR 2 million balance sheet. The difference is the next step: dividends to the founders in Spain carry 15% withholding in the Netherlands and Luxembourg and 30% in Belgium, unless the treaty reduces it.
For investor structures, the Netherlands and Luxembourg have the more established holding practice and treaty networks; our Benelux comparison and participation exemption checker go further. On payments to foreign shareholders, see dividends to non-residents.
Law and practice: Corporate Income Tax Act 1969, Article 13; Dividend Tax Act 1965, Article 4; Withholding Tax Act 2021 (dividends from 1 January 2024). LIR, Articles 147 and 166; Net Wealth Tax Law, §§ 8 and 8a, as amended by the Law of 19 December 2024; PwC Worldwide Tax Summaries, Luxembourg, other taxes. Income Tax Code 1992, Articles 202 to 205 and 264/1; Programme Law of 18 July 2025; Programme Law published 1 June 2026 (VVPRbis); Directive 2011/96/EU.
Where staff rules bite, how options are taxed and what substance means
Employee participation. Under the Commission text an EU Inc follows the participation rules of its registration state. The thresholds differ by country:
| Body | Netherlands | Luxembourg | Belgium |
|---|---|---|---|
| First mandatory body | Works council from 50 employees | Staff delegation from 15 employees over a year | CPPT (health and safety committee) from 50 workers |
| Stronger rights | Structure regime: supervisory board powers where equity reaches EUR 16 million, a works council exists and 100 work in the Netherlands | Co-decision powers from 150 employees | Works council from 100 workers |
| Board seats | Supervisory board nominations under the structure regime | One third of SA board seats from 1,000 employees over three years | None in private companies |
Luxembourg starts earliest but lightest: a staff delegation is a consultation body. The Dutch works council, from 50, has consent and advice rights on major decisions. Whether Luxembourg's board seat rule reaches an EU Inc depends on which national form Luxembourg designates to fill the gaps; it applies today only to an SA.
Employee options. The EU-ESO in the proposal would tax employees only on sale, but the Council has narrowed it and most Member States reportedly opposed harmonisation. Until it is law, national rules apply. In the Netherlands options are wage, taxed when the shares become tradable or at exercise; the government has proposed that from 2027 employees of recognised start-ups and scale-ups be taxed on 65% of the benefit, and only at sale. See employee stock options in the Netherlands. Belgium taxes qualifying warrants at grant on a lump sum, after which gains are generally untaxed. Luxembourg has no dedicated start-up regime; equity is taxed under the general rules for employment income.
Substance. All three countries, and every treaty partner, test whether the company is really managed where it is registered: a board that decides there, books and a bank account there, staff and an office matching the business. Our substance checks for Luxembourg and the Netherlands list what tax offices and banks look at.
Accounts, banks and language. Dutch accounts are filed with the KvK at the latest twelve months after year-end; Luxembourg accounts go to the RCS within seven months; Belgian accounts go to the National Bank within 30 days of approval and at the latest seven months after year-end. EU Inc articles would be bilingual, but tax returns stay in the national languages.
Law and practice: Works Councils Act, Article 2; Dutch Civil Code, Articles 2:263 to 2:265a; Luxembourg Labour Code, Articles L.411-1 et seq. and L.426-1 et seq.; Guichet.lu, 'Establishment of the staff delegation'; Belgian Law of 20 September 1948 and Law of 4 August 1996; Wage Tax Act 1964; Belgian Law of 26 March 1999, Articles 41 et seq.; COM(2026) 321, Articles 12, 78 and 79. See Dutch and Luxembourg annual accounts.
Three profiles, three countries, one plan
Two founders in Amsterdam, one in Berlin, modest profit for three years, angels in four Member States, an option pool for 30 staff. Corporate tax is 19% on the first EUR 200,000 and the works council comes at 50. The weak point is option tax at tradability, which the 2027 proposal would ease. Answer: the Netherlands. Form a B.V. now with a clean share register.
Founders in Dubai and Singapore, with a US fund, want a European holding for subsidiaries in Germany and Poland. Luxembourg's holding practice and treaty network suit them; the minimum net wealth tax is a known cost. EU Inc would need one EU-resident director, and the holding needs local management anyway. Answer: Luxembourg, with resident directors. Form an S.à r.l. now.
Founders in Belgium, 60 staff within three years, broad equity for employees. Warrants are taxed at grant on a lump sum, and below 100 workers only a CPPT is required. Registering elsewhere would not remove Belgian tax on a company run from Brussels. Answer: Belgium. Form an SRL now.
The pattern: register where management really sits; for a pure holding, pick the regime that suits the investors and build substance there.
Form now, convert later. Under the Commission text a national company can convert into an EU Inc once it has been registered for two years or has two approved annual accounts. A company formed in late 2026 meets that test in late 2028, around the earliest date EU Inc could apply. Our form now, convert later note and the EU Inc-ready company service cover the mechanics. To hear when registration opens, join the EU Inc list.
Law and practice: COM(2026) 321, Articles 21(4) and (6) and 42(2); Council mandate, Article 109; Income Tax Code 1992, Article 215; Belgian Law of 26 March 1999; Net Wealth Tax Law, § 8.
EU Inc domicile picker: rank the three countries
Enter your expected profit and answer eight questions. The picker scores Luxembourg, the Netherlands and Belgium on tax, holding rules, staff thresholds, options, team location and language, weighted by your priority. It is an orientation on the texts as of November 2026, not advice on your structure.
EU Inc domicile picker
Eight questions about your profit, group, investors, staff and team. You get Luxembourg, the Netherlands and Belgium ranked for your case, three reasons for each, and the 2026 corporate tax on your profit in all three.
An EU Inc pays the tax of its country.
19% up to EUR 200,000.
Minimum wealth tax is the price.
Warrants taxed at grant.
Where to register an EU Inc: frequent questions
Can I register an EU Inc in Luxembourg, the Netherlands or Belgium today?
No. EU Inc is a proposal for an EU regulation, COM(2026) 321 of 18 March 2026. The Council agreed its negotiating mandate on 23 October 2026, but the European Parliament has not voted and the negotiations between the institutions have not started. The rules would apply 12 months after entry into force under the Commission text, or 21 months under the Council mandate.
Does the choice of registration state change the tax of an EU Inc?
Yes, because tax stays national. An EU Inc registered in the Netherlands would expect Dutch corporate tax, in Luxembourg Luxembourg tax and in Belgium Belgian tax, exactly like a B.V., S.à r.l. or SRL. The proposal does not harmonise corporate tax; its only tax rule concerns the timing of tax on the EU employee stock option.
Which country is cheapest for corporate tax in 2026?
On profit up to EUR 200,000 the Netherlands, at 19%. Belgium is close for qualifying small companies at 20% on the first EUR 100,000. Luxembourg City is 23.87% combined on larger profits, with lower bands below EUR 200,000, and a budget bill proposes 22.80% from 2027. Above about EUR 700,000 of profit Luxembourg City comes out lower in total, because the Dutch 25.8% applies to everything above EUR 200,000.
Can the directors of an EU Inc live outside the registration state?
The Commission text requires directors to be natural persons and at least one of them to live in the EU, not necessarily in the registration state. The registered office and the central administration must be in the Union. For tax, though, where the board really decides still matters: a company managed from another country can become tax resident there.
Would an EU Inc avoid works councils?
No. Under the Commission text employee participation follows the rules of the registration state. The Council adds an option for host states, and Parliament's draft would apply the strictest regime where employees work. Choosing a country for its participation thresholds only works where the staff are.
Should I wait for EU Inc before choosing a country?
No. The country decision is the same for a national company today. Form a B.V., S.à r.l. or SRL in the state you would pick for an EU Inc, and keep it ready to convert once the regulation applies and the company has two years or two approved accounts.