Latest Newsletters & Newsflashes
Oct 05, 2022The denial of input VAT deduction right shall be subject to the principles of neutrality and proportionality
On 3 June 2022, following a preliminary ruling requested by the Hungarian Supreme Court ( Kúria), the European Court of Justice (“ ECJ”) decided on case C-188/21 concerning the proportionality of a national measure denying a taxable person’s right to input VAT deduction. More specifically, the main
Oct 05, 2022Obligation to levy VAT on transport services on the Moselle condominium between Luxembourg and Germany
On 1 August 2022, the European Court of Justice (“ ECJ”) ruled in its case C-294/21 that Luxembourg and Germany are obliged to levy VAT on passenger transport services which take place on a section of the Moselle river which constitutes a common territory under the joint sovereignty of both Member
Aug 24, 2022Newsflash | Report of the Committee on Economic and Monetary Affairs on the European Commission’s proposed ATAD 3 Directive
On 12 May 2022, the Committee on Economic and Monetary Affairs within the European Parliament (hereafter the “ Committee”) issued a draft report (the ” Draft Report”) suggesting certain amendments to the European Commission’s proposal for a Council directive laying down rules to prevent the misuse
Jul 20, 2022Higher Administrative Court | Clarifications on the calculation of time limits applicable to administrative remedies
Overview In a judgment dated 9 June 2022, the Luxembourg Higher Administrative Court ( Cour administrative) recalled that for the purposes of computing the three-month statute of limitation applicable in the case of an appeal filed against an administrative decision issued by the Director of the
Jul 18, 2022New Double Tax Treaty signed between Luxembourg and the United Kingdom
On June 7 2022, the Luxembourg government announced the signing of a new Double Tax Treaty (“ DTT”) and a Protocol with the United Kingdom that will replace the existing DTT concluded in 1967. The new DTT introduces a number of significant changes, including an exemption from dividend withholding
Jul 13, 2022Account 115 not taken into account for the Luxembourg participation exemption
On 31 March 2022, the Higher Administrative Court ( Cour administrative) ruled that shareholder contributions to a subsidiary’s account 115 are not taken into account for computation of the acquisition price of the shareholding under the Luxembourg participation exemption regime. Background The
Jul 13, 2022DAC6 | Updated guidance from direct tax administration
Background The EU Directive 2018/822 on the mandatory automatic exchange of information in relation to reportable cross-border arrangements was transposed into Luxembourg domestic law by the law of 25 March 2020 (the " DAC 6 Law"). As a reminder, the DAC 6 Law applies to cross-border tax
Jul 13, 2022End of the exceptional measure regarding teleworking for cross-border workers
As previously detailed in our newsflash dated 19 March 2020 (as updated ), the Luxembourg Government had agreed on an “exceptional measure” with the Belgian, French and German Governments regarding the taxation of Belgian, French and German cross-border commuters normally working in Luxembourg and
Jul 13, 2022Higher administrative court confirms that DTA is disallowed to control SPF companies
By a decision of 17 May 2022, the Higher Administrative Court ( Cour administrative) confirmed judgments of the Lower Administrative Court ( Tribunal administratif) of 15 September 2021 that overturned a decision rendered by the Director of the Direct Tax Administration ( Administration des
Jun 29, 2022New circular on defensive measures against non-cooperative jurisdictions
On 31 May, 2022, the Luxembourg tax authorities (“ LTA”) issued a new circular (the “ Circular”) on defensive measures against non-cooperative jurisdictions. This Circular replaces a previous circular (dated 2018) on the same subject and follows the introduction, in 2021, of Article 168 (5) of the
May 25, 2022Newsflash | EU Commission: draft Directive on tax incentive to reduce debt-equity bias
On 11 May 2022, the European Commission (hereafter the “ Commission”) published a proposal to create a level playing field for debt and equity from a tax perspective. The Commission proposes to introduce a debt-equity bias reduction allowance (hereafter “ DEBRA”) and a further limitation of the tax
Apr 13, 2022Decision of the Court of Cassation on the deductibility of VAT incurred on general expenses
In a recent decision, the Luxembourg Supreme Court ( Cour de cassation) rejected an appeal ( pourvoi en cassation) lodged by Luxembourg VAT authorities ( Administration de l’enregistrement, des domaines et de la TVA, “ AEDT”) against a decision of the Court of Appeal ( Cour d’appel). The case