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Luxembourg Tax Alert 2019-12

Luxembourg Tax Alert 2019-12



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2020 budget bill released — expiry of tax rulings issued before 2015

On 14 October 2019, the Luxembourg government presented the 2020 draft budget law (bill 7500, “the bill”).

The bill’s main tax measure relates to advance tax agreements (ATAs) that direct tax authorities issued before 1 January 2015. These agreements will no longer be valid after the 2019 tax year.

In 2015, the ATA procedure was updated and formalized in Luxembourg domestic law (the “New Procedure”), limiting the validity period to 5 years. The bill’s new measure should now complete the transition between the old ATA procedure and the new one.

While ATAs obtained before 2015 may no longer be useful to many taxpayers — for example, due to a change in the law or to transactions that have stopped being effective — the new measure could still impact some taxpayers, who may request new ATAs under the New Procedure to cover subsequent tax years — i.e. from the 2020 tax year onwards.

In a fast changing tax landscape, it’s more essential than ever that taxpayers monitor their structures, assess potential risks and identify opportunities. Our tax experts are on hand to help you with these important tasks.

The bill is still following the legislative process and may be amended before its vote in the Chamber of Deputies. Stay tuned!

Any tax advice in this communication is not intended or written by KPMG to be used, and cannot be used, by a client or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to another party any matters addressed herein.The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity.

Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

© 2021 KPMG Luxembourg, Société coopérative, a Luxembourg entity and a member firm of the KPMG network of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

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