What the PCN 2020 requires, how it structures your accounts, who has to apply it, and how to set it up once and for all in your management tool.
In short. The standard chart of accounts, known as the PCN 2020, is the mandatory account structure for most Luxembourg companies. It is set by the Grand-Ducal Regulation of 12 September 2019 and applies to financial years opening from 1 January 2020. In practice, it imposes standardised account numbers, five digits long, organised into classes, so that the balance sheet, the profit and loss account and the filing with the trade register all speak the same language. Set up properly once, it runs on its own. Set up badly, it resurfaces at every close and every audit.
Many business owners first meet the standard chart of accounts the day their accountant mentions a "605 account" or a "class 4 discrepancy". Behind the jargon lies a simple logic and a precise legal obligation. Here is what the PCN 2020 is, how it structures your accounting, who must apply it, and how to avoid the setup mistakes that cost time at every year-end.
What is the standard chart of accounts (PCN 2020)?
The standard chart of accounts is the standardised list of accounts a Luxembourg company must use to keep its books. It sets the numbering, the label and the classification of each account, so that every company presents its figures the same way. The version in force, the PCN 2020, comes from the Grand-Ducal Regulation of 12 September 2019 and replaces the chart from the 2009 regulation. It applies to financial years opening from 1 January 2020, hence the nickname.
Its point is not paperwork for its own sake. A standardised chart makes accounts comparable from one company to the next, feeds the filing forms directly and makes audits smoother. It is also what structures the FAIA export requested by the Registration Duties Authority during a check. In other words, the PCN is not an isolated constraint: it is the foundation under the balance sheet, the tax return and the audit file.
How is the PCN structured?
The chart follows a decimal classification. Each account carries a five-digit code, and the first digit signals its class. Balance sheet items sit in classes 1 to 5, profit and loss items in classes 6 and 7, with class 8 holding result accounts and special accounts. Here is the overall logic.
| Class | Content | Where it appears |
|---|---|---|
| Class 1 | Capital, provisions and financial liabilities | Balance sheet, liabilities |
| Class 2 | Formation costs and fixed assets | Balance sheet, assets |
| Class 3 | Inventory | Balance sheet, assets |
| Class 4 | Third-party accounts (customers, suppliers, State, staff) | Balance sheet, assets and liabilities |
| Class 5 | Financial accounts (banks, cash) | Balance sheet, assets |
| Class 6 | Expenses | Profit and loss account |
| Class 7 | Income | Profit and loss account |
| Class 8 | Result accounts and special accounts | Result and off-balance-sheet |
An example makes the mechanics concrete. A sale of goods feeds an income account in class 7, the matching receivable a customer account in class 4, and the payment a bank account in class 5. At the close, the difference between classes 6 and 7 forms the result, which then feeds equity in class 1. Nothing is left to guesswork: the account to use is prescribed by the chart.
Who must apply the PCN in Luxembourg?
The standard chart of accounts applies to the large majority of commercial companies required to keep double-entry books and to file annual accounts with the trade register, as the Guichet.lu portal confirms. In practice, a Sàrl, an SA or a Sàrl-S falls within this scope from incorporation. Very small structures and certain specific forms follow lighter rules, but as soon as annual accounts are filed, the PCN is the reference.
The point to remember: your software does not decide the structure, the law does. A tool set up with an in-house chart or one imported from another country will produce accounts that fit neither the Luxembourg filing nor the FAIA. It is one of the first things we fix when we take over a file kept abroad.
Not sure your chart of accounts is genuinely PCN 2020 compliant? We check it with you, no jargon.
Have my chart of accounts checkedPCN and annual accounts: the direct link
The chart of accounts is not an end in itself, it is what makes filing possible. The annual accounts filed with the trade register take the chart's balances, aggregated under standardised headings. If your books are kept cleanly under the PCN throughout the year, the close means checking and aggregating, not rebuilding everything. If the chart has drifted, the close becomes a project, with the risk of missing the filing deadlines and late fees.
The same chart also feeds your VAT returns on eCDF and the calculation of your tax on profits, which we cover in our article on corporate tax in Luxembourg. A well-kept chart is a chain that runs without a snag from the first entry to the filing.
The setup mistakes that come up most often
Most trouble comes not from the chart itself, which is stable, but from how it is wired into the tool. Four mistakes recur on the files we take over. First, a chart imported from another country: a French or Belgian chart dropped into Luxembourg as-is forces a full remap at filing time. Then accounts created on the fly, outside the standard numbering, which make the headings unreadable. A neglected reconciliation in class 4, leaving customer and supplier balances hanging without justification. And VAT poorly linked to the accounts, which distorts the eCDF return before anyone notices.
None of these mistakes is serious on its own. Together, they turn every close into an investigation. The good news is that a clean setup from the start removes almost all of them.
Setting up the PCN once and for all
At Advena, we do not keep your books next to your operations: we keep them inside the Odoo we configure for Luxembourg, with the standard chart of accounts, Luxembourg VAT and the FAIA export set up from day one. We describe that foundation in our guide to setting up Luxembourg accounting in Odoo. The benefit is twofold: the chart is compliant from the first entry, and your bank feeds and vendor bills sort themselves into the right accounts automatically, with no re-keying.
That is where our difference lies. A traditional accounting firm does not touch your management tool and collects your documents at period-end; an integrator installs the tool but does not keep your books. We do both in the same system, which removes double entry and gives you accounts that are current, not a snapshot of last year. The full picture of this model is set out in our guide to accounting firms in Luxembourg.
Want books that are PCN 2020 compliant and up to date all year, without thinking about it? Let's talk.
Talk about my accountingFrequently asked questions
What is the PCN 2020 in Luxembourg?
The PCN 2020 is the standard chart of accounts in force, set by the Grand-Ducal Regulation of 12 September 2019 and applicable to financial years opening from 1 January 2020. It imposes a standardised list of five-digit accounts that most Luxembourg companies must use.
Do all Luxembourg companies have to use it?
The large majority of commercial companies required to keep double-entry books and to file annual accounts apply the PCN. Some very small structures follow lighter rules, but as soon as accounts are filed with the trade register, the standard chart is the reference.
What is the difference between the PCN 2020 and the old chart?
The PCN 2020 comes from the Grand-Ducal Regulation of 12 September 2019, which replaced the chart from the 2009 regulation. The overall class structure stays close, but accounts were added, clarified or reorganised to fit companies' current needs better.
Can a French or Belgian chart of accounts be used in Luxembourg?
Not for filing: the annual accounts and the FAIA export expect the Luxembourg PCN structure. A foreign chart dropped in as-is forces a remap at every close. It is better to start on a compliant chart directly.
Is the PCN linked to VAT and the FAIA?
Yes. The chart's balances feed the VAT return on eCDF and the FAIA file. A poorly set up chart distorts both chains, often without anyone noticing before an audit or a close.
Further reading
- Setting up Luxembourg accounting in Odoo: PCN, FAIA and eCDF
- Accounting firm in Luxembourg: the complete guide for an SME
- Filing annual accounts in Luxembourg: deadlines and late fees
- The FAIA audit file in Luxembourg: generating it from Odoo
- Corporate tax in Luxembourg: CIT, municipal business tax and net wealth tax
Why Advena?
We are the only Luxembourg accounting firm that keeps your books inside the management tool it deployed for you. The standard chart of accounts, VAT and the FAIA are configured from the start, your books stay current all year, and the fixed monthly fee starts from 325 € per month, all in. We inform you about the rules, we do not replace tailored advice, and we tell you plainly when our model is not the right fit.
Tell us where you stand, we tell you what it costs. No phantom quote.
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