Taxation of Investment Funds in Luxembourg

As a significant financial hub on an international plan, Luxembourg is very much appreciated for the investment industry and the possibilities offered to foreign entrepreneurs. There are several types of investment funds with preferential taxes and permissive regulatory framework. We invite you to get in touch with our team of company formation representatives in Luxembourg and benefit from complete information and assistance in matters of company registration or investment funds set up.

 

 

 Alternative investment funds, hedge funds, retail funds, undertakings for collective investments (UCIs), and real estate investment funds are the types of investment funds you can consider when deciding for business in Luxembourg. 

 

 

SIF or the Specialized Investment Funds are part of the undertakings for collective investments and are subject to several tax exemptions, like:

 

• there is no wealth tax, no income tax and no capital gains imposed;

• management fees are not subject to VAT in the case of SIFs;

• there is no stamp duty, but an annual subscription tax;

• SIFs benefit from the provisions of the double taxation treaties.

 

Foreign investors in Luxembourg can benefit from a series of tax reliefs, but for a proper understanding of the taxation regime in this country, you can talk to one of our company incorporation specialists in Luxembourg.

 

 

The hedge funds established an investment company with variable capital (SICAV) or as an investment company with fixed capital (SICAF) are exempt from taxation under the rules of the double taxation agreements signed by Luxembourg. Just like in the case of SIFs, the hedge funds are not subject to an income tax or a wealth tax. Detailed information about how you can set up an investment fund in Luxembourg can be provided by our team of advisors.

 

 

The annual subscription tax applies for hedge funds, SIFs and UCIs and it is set at a rate ranging between 0.01% and 0.05%. The funds’ net assets are levied with the subscription tax on a yearly basis.

 

 

Please feel free to contact our team of company formation agents in Luxembourg and find out information about how the investment funds are taxed in Luxembourg.