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We are all navigating unchartered waters as business and society faces up to the impact of COVID-19. We very much hope you and your loved ones remain in good health.
Please be assured that Fieldfisher is continuing to work with clients to navigate COVID-19 related issues and on business as usual needs. Do get in touch with us if you would like to chat anything through.
On 30 March 2020 The Luxembourg Government filed a new bill (7547) to the effect of denying, as from 1st January 2021, the deduction of interests and royalties payable to "collective entities" established in one of the (currently 12) "non-cooperative" jurisdictions listed by the EU, including American Samoa, Cayman Islands, Fiji, Guam, Oman, Palau, Panama, Samoa, Seychelles, Trinidad and Tobago, US Virgin Islands and Vanuatu. Such list is to be updated on a regular basis, probably in October 2020.
Last but not least, the new provision (article 168 LITL) would not be applicable, and therefore full deductibility ensured (subject to general rules) in case the transaction giving rise to interests or royalties is used for valid commercial reasons reflecting the economic reality - to be demonstrated by the taxpayer. The new provision is due to enter into force as from 1st January 2021.
For further details, please contact jean-luc.dascotte@fieldfisher.com or your usual contact at Fieldfisher.