Luxembourg has concluded more than 70 double tax treaties
and nearly 20 such agreements are pending for approval. A Convention for the avoidance of double taxation
is advantageous for foreign investors
from that country who want to open a business in Luxembourg or vice versa.
The provisions of a double tax treaty
The model used for the double tax avoidance agreements is in line with the provisions of the Organization of Economic Cooperation and Development. The most important goal of a double taxation treaty is to eliminate double taxation for the same individual or same legal entity. This implies that the Contracting States decide which one will levy a certain tax on the income produced therein.
The withholding taxes on dividends, royalties and capital gains are targeted in all double tax treaties
. While both countries impose a normal rate for these types of income, under an agreement of this type the rate will be reduced and in some cases will be even eliminated completely. The types of taxes
usually covered by a double tax treaty include the corporate tax, the income tax, the wealth tax, the communal business tax and others.
Special provisions within these treaties allow for the prevention of tax discrimination and also for the prevention of tax evasion. Special rules are in place for the exchange of information between the Contracting States.
Double tax treaties signed by Luxembourg
Luxembourg has signed double tax treaties with the following countries: Armenia, Austria, Azerbaijan, Bahrain, Barbados, Belgium, Brazil, Bulgaria, Canada, china, the Czech Republic, Denmark, Estonia, Finland, France
, Georgia, Germany, Greece, Guernsey, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Isle of Man, Israel, Italy, Japan, Jersey, Kazakhstan Laos, Latvia, Liechtenstein, Lithuania, Macedonia, Malaysia, Malta, Mauritius, Mexico, Moldova, Monaco, Morocco, the Netherlands, Norway, Panama, Portugal, Qatar, Romania, Russia, San Marino, Saudi Arabia, Seychelles, Singapore, Slovakia, Slovenia, South Africa, South Korea, Spain, Sri Lanka, Sweden, Switzerland
, Taiwan, Tajikistan, Thailand, Trinidad & Tobago, Tunisia, Turkey, United Kingdom, United Arab Emirates
, Uzbekistan, Vietnam.
Luxembourg has pending double tax treaties with the following countries: Albania, Andorra, Argentina, Botswana, Brunei, Croatia, Cyprus, Egypt, Kyrgyzstan, Kuwait, Lebanon, New Zealand, Oman, Pakistan, Senegal, Serbia, Syria, Ukraine, Uruguay.
Investors who are interested in doing business in other European countries, such as Italy
etc. may find out information about double tax treaties signed by these countries from our local representatives.