The Luxembourg Family Wealth Management Company (SPF or société de gestion de patrimoine familial) is a form of investment vehicle. The purpose of this company is to buy, hold, sell and manage financial assets of its investors. It helps in performing effective private wealth management.
Luxembourg private wealth management company
The SPF may have its bank account in another bank of the European area. It may be incorporated under the shape of Public limited company or limited liability company.
Damalion may help you to incorporate a Luxembourg family wealth management company or SPF for your asset protection and wealth preservation. Please contact your Damalion experts now.
Luxembourg family wealth management company
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.
Luxembourg family wealth management company (SPF) in 2025 – purpose, eligible investors, permitted activities, tax rules, governance basics and control checks for long-term private wealth planning.
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Last updated:What is a Luxembourg SPF in 2025?
The Luxembourg family wealth management company (SPF – société de gestion de patrimoine familial) is a private wealth vehicle governed by the law of 11 May 2007, as amended. Its object is to hold and manage financial assets for eligible investors on a passive basis. It is not an operating company. It is used for asset protection, portfolio centralisation, inter-generational planning and long-term wealth structuring.
The SPF is exempt from Luxembourg corporate income tax, municipal business tax and net wealth tax. It pays a yearly subscription tax (taxe d’abonnement) on a defined base. The regime is subject to strict rules on eligible investors, permitted activities and documentation. From 2025, updated rules strengthen transparency, sanctions and administration.
Key decisions and documents before you create an SPF
- Confirm that all shareholders are eligible investors (private individuals, certain private wealth entities, or intermediaries acting for them).
- Define the expected asset mix (listed securities, fund units, private company shares, cash, structured products).
- Select the legal form: public limited company (SA), private limited company (Sàrl), partnership limited by shares (SCA) or cooperative company organised as an SA.
- Draft articles of association that limit the purpose to the passive acquisition, holding, management and disposal of financial assets, and exclude commercial activities and direct real estate.
- Prepare shareholder agreements and internal rules on voting, profit distribution and exits where needed.
- Gather identification and KYC documents for shareholders, directors and beneficial owners according to AML rules.
- Choose a registered office and, where relevant, a domiciliation agent in Luxembourg.
- Plan the initial capital and any shareholder loans, keeping in mind the debt-to-equity ratio that affects the subscription tax base.
- Coordinate with a bank for the capital payment account and future custody of financial assets.
- Obtain written tax and legal advice on the SPF regime and on the situation of the investors in their country of residence.
SPF and other holding companies at a glance
| Topic | Luxembourg SPF | Ordinary Luxembourg holding (SOPARFI) |
|---|---|---|
| Main purpose | Private wealth management for eligible investors, passive holding of financial assets. | General holding and financing of participations, often used for business and investment structures. |
| Investors | Individuals managing their private wealth, private wealth entities acting for such individuals, and intermediaries acting on their behalf. | Broad range of shareholders, including companies and institutional investors without specific eligibility rules. |
| Activities | Acquisition, holding, management and disposal of financial assets; no commercial activity; no direct real estate; no active management of participations. | Holding and financing of participations, including active involvement in subsidiaries’ management, subject to corporate and tax rules. |
| Tax treatment | Exempt from corporate income tax, municipal business tax and net wealth tax. Subject to 0.25% subscription tax with a legal minimum and maximum. | Subject to ordinary corporate income taxes with access to participation exemption and double tax treaties if conditions are met. |
| Treaty access | Does not normally benefit from double tax treaties or EU directives. | May access double tax treaties and EU directives when conditions are fulfilled. |
| Regulation | Not a regulated fund. Supervision is mainly by the tax administration for the SPF law and by company law for corporate matters. | Not a fund either, but fully subject to general tax and company law rules. |
Main steps to create and operate a Luxembourg SPF
- Structuring and eligibility check. Confirm that the SPF fits the family or investor profile. Check eligibility of investors and assets under the SPF law.
- Design of legal form and documentation. Choose SA, Sàrl, SCA or cooperative SA. Draft articles, shareholder agreements and internal rules that reflect the SPF restrictions.
- Incorporation and capital contribution. Execute the notarial deed, pay in the share capital, register the company and obtain identification numbers.
- Opening of bank and custody accounts. Set up bank accounts and, where relevant, custody accounts for financial assets. Align KYC and AML documentation with SPF investors and structure.
- Ongoing governance and compliance. Hold meetings, keep accounting records, file the subscription tax returns and required certificates, and monitor that activities stay within the SPF perimeter.
Costs, taxes and timing
- Incorporation costs. Notary fees, legal drafting, registration costs and any advisory fees for the initial design.
- Annual subscription tax. 0.25% on a defined base (paid-up capital, share premium and certain excess debt), subject to a legal minimum and maximum amount per year.
- Service provider fees. Domiciliation, accounting, directorship, audit (where required) and tax compliance services.
- Bank and custody fees. Account maintenance, custody, transaction and portfolio management fees as agreed with the chosen institutions.
- Typical timing. With complete information, incorporation and first account opening can often be achieved in a few weeks. Timing always depends on KYC, complexity of the structure and the response time of external parties.
Related reading
- The private wealth management company SPF in Luxembourg
- Contributing Shares to a Luxembourg SPF in 2025 – Updated Guide for Family Offices & Investors
- Manage your family wealth with Luxembourg SPF (Private wealth management company)
- Investing in ETFs: How Luxembourg Private Wealth Management Companies support your wealth growth
Frequently asked questions
What is a Luxembourg family wealth management company (SPF)?
A Luxembourg SPF is a company governed by the law of 11 May 2007, as amended, whose exclusive purpose is to acquire, hold, manage and realise financial assets for eligible investors, on a passive basis and without commercial activity.
Who may invest in an SPF in 2025?
Eligible investors are private individuals managing their own wealth, private wealth management entities that act only for one or more individuals, and intermediaries acting on behalf of such investors. The SPF cannot be marketed to the public.
Which legal forms can an SPF take?
An SPF can be set up as a public limited company (SA), a private limited company (Sàrl), a partnership limited by shares (SCA) or a cooperative company organised as a public limited company. General partnership and ordinary limited partnership forms are not used for SPFs.
What activities are permitted for an SPF?
The SPF may acquire, hold, manage and sell financial assets such as shares, bonds, fund units, money market instruments and cash. Its role must remain that of a passive investor and not that of a trading or service company.
Is an SPF allowed to carry out commercial activities?
No. The SPF may not carry out any commercial or industrial activity. If it performs activities that fall outside passive asset holding, it risks losing its SPF status and being taxed under the ordinary corporate regime.
Can an SPF hold real estate directly?
Direct ownership of real estate is not allowed for an SPF. Exposure to real estate is only possible through holdings in companies or funds that themselves own property, subject to the applicable tax and legal rules.
May an SPF grant loans or guarantees?
The SPF may not carry out lending activities as a business. It may, on an ancillary and unpaid basis, grant guarantees or short-term cash advances to entities in which it holds a participation, provided this support remains incidental to its passive holding activity.
How is an SPF taxed in Luxembourg in 2025?
An SPF that complies with the law is exempt from corporate income tax, municipal business tax and net wealth tax. It is subject to an annual subscription tax at a rate of 0.25% on a defined base. The tax is due even in the absence of profit.
What is the subscription tax base and the minimum amount?
The subscription tax base is the sum of paid-up share capital, share premium and the portion of debt that exceeds eight times the amount of equity. From 2025, the law provides for a minimum annual subscription tax amount and a maximum cap per year.
Does an SPF have access to double tax treaties or EU directives?
Because an SPF is not fully taxable on its income, it generally does not benefit from Luxembourg double tax treaties or from certain EU directives such as the Parent-Subsidiary Directive. Withholding taxes abroad may therefore not be reduced.
Can an SPF obtain a tax residence certificate?
Under specific conditions, the tax administration may issue a residence certificate that confirms the SPF is resident in Luxembourg. This does not, however, override the legal exclusions from double tax treaty and directive benefits applicable to SPFs.
Are there special rules for the company name of an SPF?
Companies that benefit from the SPF regime must include the words “société de gestion de patrimoine familial” or “SPF” in their name. Failure to comply with this requirement may give rise to administrative fines.
Is an SPF supervised by the financial regulator?
The SPF is not an authorised or regulated investment fund and is not supervised by the CSSF as such. It is, however, subject to the SPF law, to company law and to tax and AML rules, with oversight by the competent authorities.
Which accounting and reporting obligations apply?
The SPF must keep accounts, approve annual financial statements and comply with filing obligations under company law. It must also file the subscription tax return and provide the annual certificate required by the SPF law.
Does an SPF need audited financial statements?
Audit requirements depend on the legal form and on size criteria under Luxembourg company law. A larger SPF may be subject to statutory audit, while a small SPF may be exempt, subject to the thresholds in force.
What are the sanctions for non-compliance with the SPF law?
From 2025, the law allows the tax administration to impose administrative fines for failures such as missing filings, late payment of subscription tax, use of an incorrect name or breach of eligibility and activity rules. Fines can increase in serious cases.
Can SPF status be withdrawn?
If an SPF breaches the law and does not remedy the situation within the period granted by the tax administration, the SPF status may be withdrawn. In that case, the company may become fully taxable under the ordinary regime, possibly with retroactive effect.
How does AML and KYC apply to an SPF?
Although the SPF itself is not a regulated fund, the professionals who incorporate, administer, advise or bank the SPF must apply anti-money laundering and know-your-customer rules. Investors should be ready to provide full identification and source-of-funds evidence.
Can an SPF list its shares or raise money from the public?
No. The SPF cannot list its shares on a stock exchange or carry out public offerings. Its shareholders must remain within the eligible investor categories and the placement of its shares must stay private.
Is independent advice recommended before using an SPF?
Yes. Because the SPF is subject to specific legal and tax conditions and interacts with the personal tax situation of the investors, independent legal and tax advice is strongly recommended before creation and for any major transaction.
Major Banks in Luxembourg
- Banque et Caisse d’Épargne de l’État (Spuerkeess)
- BGL BNP Paribas
- Banque Internationale à Luxembourg (BIL)
- Banque de Luxembourg
- ING Luxembourg
- Banque Raiffeisen
- Société Générale Luxembourg
- Intesa Sanpaolo Bank Luxembourg
- Deutsche bank Luxembourg
- HSBC Luxembourg
Hotels in Luxembourg City
- Hotel Le Royal Luxembourg
- Sofitel Luxembourg Le Grand Ducal
- Sofitel Luxembourg Europe
- Novotel Luxembourg Centre
- Parc Hotel Alvisse
- Hotel Le Place d’Armes
- Meliá Luxembourg
- Hotel Parc Belair
- DoubleTree by Hilton Luxembourg
- Park Inn by Radisson Luxembourg City
