The proposed measures are generally in line with the provisions of ATAD II and should apply as from 1 January 2020 except for the rules on reverse hybrids which should apply as from 1 January 2022.
The new measures are expected to have a significant impact on Luxembourg corporate taxpayers having cross-border operations. Specific measures have however been introduced to address unintended consequences for investment funds. In particular, the acting together concept should not apply to an investor that holds directly or indirectly less than 10% in the interest of the fund and which is entitled to less than 10% of the profits of this fund. In addition, most collective investment funds should be excluded from the reverse hybrid rule. Please click on the link below to read the entire Newsflash.
You will find content about:
Hybrid mismatches covered by the new Article 168ter LITL
Associated enterprises & Acting together
Application of the rules
Reverse hybrids (new article 168quater ITL applying as from 1 January 2022)
Burden of proof
Our concluding remarks