Luxembourg - Amendments to Direct Taxation with Retroactive Effect are Presented

Local tax news

Luxembourg - Amendments to Direct Taxation with Retroactive Effect are Presented
On 5 March 2019, the Budget 2019 was presented by the Minister of Finance to the parliament. The amendments which will apply retroactively from 1 January 2019, are summarized below.
 
(i) The standard corporate income tax rate will be reduced from 18% to 17%. As a result the combined corporate income tax rate including the surcharge for the employment fund and the municipal business tax will be reduced from 26.01% to 24.94%.
 
(ii) From 1 January 2019, Luxembourg has implemented the interest deduction limitation of the EU ATAD 1. The maximum deduction is equal to 30% of the EBITDA or EUR 3 million.

(iii) The Bill clarifies the possibility to reduce the tax liability at fiscal unity level by making losses and accruing tax credits before or during the period of tax consolidation.

If these subjects are something which you find interesting and would like to discuss further we are happy to be at your service. Contact us at [email protected].