Luxembourg: Revisions to transfer pricing circulars; intra-group financing transactions

Transfer pricing guidance in Luxembourg

The Luxembourg tax authorities on 27 December 2016—following approval of new article 56bis of the Luxembourg income tax law—published a new transfer pricing circular aimed at clarifying the transfer pricing rules for companies principally performing intra-group financing transactions.

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The new guidance is: Circulaire du directeur des contributions L.I.R. n° 56/1 – 56bis/1 du 27 décembre 2016

KPMG observation

With this new circular, Luxembourg is adapting its legal framework to take into account latest international and European developments. The new circular is being viewed as positive new developments regarding the application of the arm’s length principle.

 

Read a December 2016 report prepared by the KPMG  member firm in Luxembourg

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