REGULATORY CLIENT UPDATE / REAL ESTATE LEVY FILING
On 20 January 2022, the Luxembourg tax authorities (LTA) released a new Circular regarding the real estate levy introduced by the Luxembourg law of 19 December 2020. Luxembourg investment vehicles which directly or indirectly own or invest in Luxembourg real estate will have to submit their real estate levy return before 31 May 2022, and those vehicles which do not own or invest in Luxembourg real estate will have to report this fact. Failure to comply may result in a fine imposed by the LTA.
The aim of the Circular is to provide investment vehicles with guidance in respect of the Luxembourg law of 19 December 2020 which introduced a 20% real estate levy on certain Luxembourg investment vehicles that own real estate assets located in Luxembourg. Note that the assets can be owned either directly by the vehicle or indirectly through a Luxembourg tax transparent entity (e.g., SCS, SCSp, SCI and SNC), a Fond Commun de Placement (FCP) or any other foreign transparent entity. The investment vehicles in scope are:
The real estate levy only applies to the above vehicles that have a corporate legal form. It does not apply to investment vehicles incorporated as partnerships (such as a Luxembourg SCS/SCSp), incorporated as contractual agreements (such as a Luxembourg FCP), or foreign-established vehicles.
All investment vehicles in scope which hold Luxembourg real estate assets either directly or indirectly through tax transparent entities or FCPs must: (i) file a return declaring their qualifying income; and (ii) notify the ownership.
In addition, investment vehicles in scope owning no Luxembourg real estate assets as well as investment vehicles that would have qualified as In-Scope Funds if they had not changed their corporate form in 2020 or 2021 must notify the Luxembourg tax authorities by 31 May 2022. The reporting must be performed via the MyGuichet platform.
For further information, please contact:
m: +352 691 111 931
Disclaimer: This regulatory update has been prepared for clients of ONE group solutions and its subsidiaries for informational purposes and is not intended to be relied upon as professional advice. Please visit: https://www.one-gs.com/
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