A double taxation agreement was signed with Israel in March 2005. The Luxembourg government recently approved tax agreements to avoid double taxation with Guernsey, Jersey, the Isle of Man, Saudi Arabia and the Czech Republic. Overall, tax treaties provide for the taxation of entities in the country where they reside (contracts contain “Tiebreaker” clauses to resolve cases where both countries are domiciled), except that when a unit established in one country has a stable establishment in another country, the revenues from that permanent representation are taxed in the second country. Individual taxation also follows residence, but in cases where income could be taxed twice, there is either a “Tiebreaker” clause or a provision that, in one country, rewards a tax with that due on the same income in the other, while the contract with the United States contains “savings” and “prescription benefits” clauses that may, in certain circumstances, nullify the purpose of the contract. The specific provisions for border workers are contained in the following double taxation agreements: – 20 March 2018. Luxembourg and France signed a new double taxation agreement (the DTTs and replaced the double taxation agreement signed on 1 April 1958. The DTT will incorporate, among other things, the OECD`s most recent approach (as contained in the OECD Model Tax Convention 2017 and the Multilateral Agreement on the Implementation of Tax Treaty Measures). In this context, the DTT introduces new rules for the taxation of cross-border payments (such as dividends, interest and royalties), significant changes to the taxation of real estate investments made by Luxembourg companies using special French investment vehicles and redefines what is a stable institution for the purposes of the DTT. The DTT will enter into force as soon as the Luxembourg and French governments have completed the ratification process.
It is considered that the provisions of the DTT could apply as of January 1, 2019. In accordance with paragraph 1 of the Protocol, the competent authorities of the contracting states exchange information “which is foreseeable for the application of the provisions of this Convention or for the administration or enforcement of national legislation relating to all taxes and descriptions that are collected on behalf of the States Parties or their political subdivisions or their local authorities, provided that the tax regime is not contrary to the convention.” Previous updates are available on the Archives: www.wildgen.lu/our-insights/article/luxembourg-double-tax-treaties-network-archives In November 2005, officials from the United Arab Emirates and Luxembourg reached a new agreement to avoid double taxation, which aims to boost bilateral trade and bilateral investment between the two states. 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. List of Luxembourg double taxation conventions on the Direct Contributions Administration website. 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. July 12, 2019. Act of 12 July 2019 on the implementation of a new double tax treaty with France, a dual tax treaty with Kosovo and two protocols on tax treaties with Belgium and Uzbekistan has been published (Memorial A 495, 12 July 2019) The new protocol updates the exchange of information from the existing double taxation convention to bring it in line with current OECD standards.