On 29 January 2025, the Luxembourg tax authorities published Circular L.I.R. n° 164/1 (Circular), which replaces the previous circular L.I.R. n° 164/1, dated 23 March 1998. The Circular updates the rules related to interest...more
Among other tax incentives for individual and corporations, the Luxembourg Parliament adopted on 11 December 2024 an amendment to the interest deduction limitation rule via the introduction of the concept of a single-entity...more
Welcome to the third edition of our Horizon Scan for 2024: key recent and expected funds, regulatory and tax developments to look out for. As before, we focus on the most important developments and changes that we expect...more
11/1/2024
/ Corporate Governance ,
Disclosure Requirements ,
Economic Sanctions ,
EU ,
Financial Crimes ,
Fund Managers ,
MiFID II ,
Packaged Retail And Insurance-Based Investment Products (PRIIPS) ,
Private Funds ,
Regulatory Requirements ,
SFDR ,
Sustainable Finance ,
UK
On August 22, 2024, Germany’s Federal Fiscal Court (Bundesfinanzhof) published a decision that refocuses attention on the complexities of cross-border taxation, particularly for Luxembourg-based funds investing in Germany....more
On 17 July 2024, the Luxembourg government introduced, under new Bill n° 8414, a comprehensive legislative package meant to modernise and enhance Luxembourg’s tax system. ...more
In a strategic move to support and breathe new life into the housing market, the Luxembourg government has enacted a sweeping set of measures in a law voted on by Luxembourg’s parliament on May 22, 2024. Aimed at both...more
On 12 June 2024, Luxembourg published a bill of law amending the law of 22 December 2023 (the Pillar Two Law[1]) implementing EU directive no. 2022/2523, largely known as the “EU Minimum Tax Directive” or “Pillar Two...more
Welcome to the second edition of our Horizon Scan for 2024: key recent and expected funds, regulatory, and tax developments to look out for. As before, we focus on the most important developments and changes that we expect to...more
5/24/2024
/ Climate Change ,
Cross-Border ,
Disclosure Requirements ,
EU ,
False Claims Act (FCA) ,
Fund Managers ,
Investment Funds ,
Private Funds ,
Private Investment Funds ,
Regulatory Standards ,
Reporting Requirements ,
SFDR ,
Sustainability ,
Sustainable Business Practices ,
Sustainable Finance ,
Transitional Arrangements ,
UK
On 10 November 2023, the Luxembourg Constitutional Court ruled that the current minimum net wealth tax regime, as applied to Luxembourg resident companies, partially violates the constitutional principle of equal treatment....more
At a first glance, it has to be recalled that in accordance with the Circular n° 781 dated 30 September 2016, the Luxembourg VAT authorities consider that the activity of a board member has an economic nature in relation to...more
On 4 August 2023, Luxembourg published a bill of law (the “Bill”) to transpose the EU directive no. 2022/2523 largely known as the “EU Minimum Tax Directive” or “Pillar Two Directive”, ensuring a minimum global Effective Tax...more
On 12 October 2022, the finance minister presented the Luxembourg budget bill for fiscal year 2023.
For corporate tax payers, and particularly for funds, there is a most welcomed clarification on the scope of the...more
The Luxembourg Tax Authorities have started to issue late filing penalties for a fixed amount of EUR 10,000 for the non-fulfillment of the reporting obligation regarding real estate levy.
In light of this action,...more
Further to the request of the European Parliament for concerted EU action, the European Commission issued on 22 December 2021 a proposal for a Council Directive laying down rules to prevent the misuse of shell entities...more
The EU Commission published a public consultation based on its initiative to introduce a common EU-wide system for withholding tax on dividend or interest payments, which includes a system for tax authorities to exchange...more
6/23/2022
/ Cross-Border ,
Cross-Border Transactions ,
Dividends ,
Double Taxation ,
EU ,
European Commission ,
Interest Payments ,
Investors ,
Member State ,
Public Consultations ,
Tax Authority ,
Tax Evasion ,
Tax Fraud ,
Tax Refunds ,
Withholding Tax
On 7 June 2022, a new Double Tax Treaty (the “DTT”) has been signed between Luxembourg and the United Kingdom (UK) to reflect the most recent OECD tax standard. An additional protocol will replace the tax treaty signed in...more
On March 31, 2022, the Luxembourg Administrative Court of Appeal ruled that, in order to determine the minimum acquisition value of a participation for the purposes of the Luxembourg parent-subsidiary exemption, the...more
On 22 December 2021, the European Commission presented a proposal for a new directive to fight against the misuses of shell entities for improper tax purposes. This proposal has been issued to ensure that entities in the...more
BACKGROUND -
On 22 December 2021, the European Commission presented a proposal for a new directive to fight against the misuses of shell entities for improper tax purposes.
This proposal has been issued to ensure that...more
On 17 June 2021, the Court of Justice of the European Union (CJEU) rendered two decisions about the application of the VAT exemption for management services provided in article 135 (1) (g) of the EU VAT Directive and...more
7/30/2021
/ Court of Justice of the European Union (CJEU) ,
EU ,
Exemptions ,
Fund Management Companies ,
Fund Managers ,
Income Taxes ,
Investment Funds ,
Investment Management ,
Investors ,
Luxembourg ,
Risk Management ,
Software ,
Tax Authority ,
Tax Litigation ,
Tax Returns ,
Third-Party Liability ,
Value-Added Tax (VAT)
On 4 and 5 June 2021, the Finance Ministers and Central Bank Governors of the G7, joined by the Heads of the International Monetary Fund, World Bank Group, Organisation for Economic Cooperation and Development, and Eurogroup,...more
6/10/2021
/ Corporate Taxes ,
Digital Services Tax ,
G7 ,
International Tax Issues ,
Investment Funds ,
Luxembourg ,
Multinationals ,
New Rules ,
Tax Haven ,
Tax Liability ,
Tax Rates ,
Tax Reform
On 6 November 2020, Luxembourg and Russia signed a Protocol amending the Luxembourg-Russian Double Tax Treaty.
This new Protocol provides new withholding tax rates and rules for the taxation of dividends and interest...more
Luxembourg has introduced new legislation disallowing the deduction of interest and royalties owed by Luxembourg corporate taxpayers to associated enterprises established in a jurisdiction included in Annex I of the European...more
On 11 March 2021, the Luxembourg Tax Authorities published a Circular providing guidance on the process for initiating the mutual agreement procedure (“MAP”) under bilateral income tax treaties and explaining the interaction...more
On 8 January 2021, the Luxembourg Tax Authorities published a Circular clarifying the interest limitation rules introduced in Luxembourg legislation in 2018, which implemented the European Union Anti-Tax Avoidance Directive...more
4/9/2021
/ Anti Tax Avoidance Directive (ATAD) ,
Borrowers ,
Corporate Taxes ,
Debt ,
EBITDA ,
Income Taxes ,
Interest Rates ,
Luxembourg ,
New Guidance ,
Tax Authority ,
Tax Deductions