Strengthened cooperation between Luxembourg tax agencies

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Starting on 24 June 2024, the direct tax authorities (ACD) and the indirect tax authorities (AEDT) have enhanced their cooperation, marking a significant step forward in tackling tax fraud and increasing tax revenues.

The ACD and the AEDT have signed a memorandum containing instructions for implementing the amended law of 19 December 2008 on inter-administrative and judicial cooperation, as well as strengthening the capabilities of the tax authorities.

The 5 key features of this closer cooperation between the ACD and the AEDT are:
  • Improved communication between tax offices: tax office interactions will now involve not only heads but also their deputies.
  • Mandatory spontaneous communication above certain tax correction thresholds: the thresholds will be adjusted if needed, based on practical experience.
  • Spontaneous exchange of tax refund information: this will be done digitally to enable the other tax agency to issue third-party demands (sommation à tiers détenteur).
  • Simultaneous audits in cooperation with tax offices: centrally coordinated simultaneous audits will continue and all tax departments within tax offices will now be able to participate (beyond the current involvement of the ACD’s Review department (Service de révision) and the AEDT’s Anti-Fraud department).
  • Regular assessment of cooperation: the two tax agencies will regularly review the outcomes of their cooperation, using feedback for continuous improvement.

This initiative underscores the government’s commitment to enhancing both tax compliance and the efficiency of tax administration through strengthened inter-agency collaboration.

How we can help

The Tax Partners and your usual contacts at Arendt & Medernach are at your disposal to help you fully understand your situation and how it will impact your operations in Luxembourg.