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COVID-19: Luxembourg tax measures

23 Mar 2020

The Luxembourg government announced a series of tax measures in order to deal with the effect of COVID-19.

Cancellation of advance payments and payment deadline

Legal persons and individuals who, amongst others, exercise a commercial activity or a liberal profession and who experience liquidity problems as a result of the COVID-19 pandemic, may apply for:

  • a cancellation of their quarterly advances of the corporate income tax and municipal business tax for the 1st and 2nd quarter of 2020. The relevant application template may be found here ("annulation avances")
  • an extension of the payment deadline for corporate income tax, municipal income tax and net wealth tax. The relevant application template may be found here ("délai de paiement")

The announcement status that such requests will automatically be accepted for eligible taxpayers.

Filing of income tax and VAT returns

In addition, the deadline for legal persons and individuals for submitting the 2019 income tax returns has been extended from 31 March 2020 to 30 June 2020. This decision also applies to taxpayers who wish to request, modify or revoke the selection of their individual tax scheme.

The Luxembourg Indirect Tax Authorities also announced that the late filing of VAT returns will not be subject to any penalties or fines until otherwise indicated by the administration.

Cross-border workers

French cross-border workers will be able to work from home without those days counting for towards the number of days worked remotely. Under normal circumstances, per the France-Luxembourg double tax treaty, French cross-border workers are entitled to work from France for up to 29 days per year without the related remuneration being taxed in France.

The same measure has been announced for the Belgian cross-border workers, who per the Belgium-Luxembourg double tax treaty are entitled to work from Belgium up to 24 days per year without the related remuneration being taxed in Belgium.

No official announcements have been made until now with respect to German cross-border workers.

Filing of annual accounts

An extension of four months is provided to companies for the filing of the annual accounts for 2019 without being subject to any late filing penalties or fines. It means that for a financial year ending, for example, on 31 December 2019, the filing of the annual accounts is extended from 31 July 2020 to 30 November 2020.

Authors

Andrew Knight Harneys front portrait image on a grey background

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