Select Page

April 20, 2018. On 17 April, the law transposing the double taxation convention with Cyprus (including the provisions of the OECD tax treaty) was published (Memorial A 267, 20 April 2018). The Double Taxation Convention will come into force on January 1, 2019, but no official publication has yet been published. Luxembourg signed a new tax cooperation agreement with France in June 2009, changing its 50-year-old tax treaty to allow the exchange of tax information. In November 2007, Hong Kong and Luxembourg signed a comprehensive agreement to avoid double taxation. In June 2008, it was announced that the governments of India and Luxembourg have signed an agreement to avoid double taxation and prevent tax evasion on income and capital taxes. December 5, 2017. Luxembourg and Belgium have signed a protocol to amend the existing tax treaty on the taxation of border workers, including the reciprocal agreement reached on 16 March 2015. On 27 July 2009, the Principality of Monaco signed an agreement with Luxembourg to avoid double taxation and tax evasion. A new double taxation agreement was signed with Germany on 23 April 2012. The new agreement complies with OECD standards and replaces the current treaty, signed in 1958. Also in November 2009, Luxembourg Finance Minister Luc Frieden and his Spanish counterpart Elena Salgado Mendez signed an amendment to the existing bilateral double taxation (DBA) agreement between the two countries on the sidelines of a meeting of the European Council of Finance Ministers (Ecofin). The Grand Duchy`s contractual partners are among the most industrialized countries, including Cyprus, the United States, Japan, Brazil, China, Mexico, Hong Kong and Russia, Canada.

Luxembourg`s tax treaties, because most bilateral agreements are designed and balanced to address a specific economic context. Because of their nature, tax treaties are constantly negotiated and updated to the latest international standards. On 2 July 2009, a protocol amending the Convention on the Prevention of Double Taxation between the United Kingdom and Luxembourg was signed in London to facilitate the exchange of information for tax purposes between the two governments. Luxembourg has signed 82 DTTs, most of which contain provisions of Article 26.5 of the Organisation for Economic Cooperation and Cooperation (OECD) convention model on the exchange of information between tax authorities. Luxembourg is part of the European Union (EU) Regulations 1408/71 and 883/2004 (amended) on the coordination of social security systems. In addition, Luxembourg has 39 bilateral social security agreements. On 6 November 1993, an amendment to the agreement between the Grand Duchy of Luxembourg and the Russian Federation on the prevention of double taxation and the prevention of tax evasion in relation to income and capital taxes was signed. In accordance with the OECD standard, the revised DBA provides, on request, for information to be exchanged between the relevant tax authorities in some cases. It came into force on January 1, 2011. On 22 May 2009, the Luxembourg and Liechtenstein governments announced their intention to open negotiations for a model OECD convention on the prevention of double taxation. The agreement was signed before the end of the year.

The Grand Duchy of Luxembourg is located at the crossroads of Europe and is based on a dynamic and open economy that actively promotes the development of cross-border trade and investment. Its important role in international trade in the banking and finance, investment fund and holding sectors has had the effect of developing a strong network of double taxation agreements over the years. To this end, Luxembourg has concluded more than 80 global double taxation agreements, based on the OECD`s model tax treaty on income and capital, to reduce the risk of double taxation for businesses.