Articles

New protocol to France-Luxembourg Tax treaty

New protocol to France-Luxembourg Tax treaty

New protocol to France-Luxembourg Tax treaty

11.09.2014 LU law

The Luxembourg and French Finance Ministers signed a new protocol to the Luxembourg-France Tax Treaty on 5th September 2014.

What is the new protocol about?

This protocol adds a fourth paragraph to the Tax Treaty’s Article 3 on income and gains from immovable property allocating the exclusive right to tax capital gains realized on the disposal of stock, shares, and other corporate rights in a “real estate entity” to the Contracting State where the immovable property is located. 
The protocol states that the application of this new provision will not contravene with the application of the Merger Directive. 

What is a “real estate entity” according to the new protocol?

The “real estate entity” can be a company, a trust, a partnership, or any other type entity which (i) holds assets or property consisting of more than 50% of the value of immovable property or rights on immovable property situated in a Contracting State; or (ii) is deriving more than 50% of its value directly or indirectly from immovable property or rights on immovable property situated in a Contracting State. 

Immovable property used to conduct the entity’s business is not taken into account when assessing the real estate assets’ predominance.

When does the new protocol enter into force?

Even though the protocol has been signed, it has not entered into force yet.  Both countries still have to notify each other about the completion of the procedure required for amending its national legislation. It should, however, be noted that such protocol would enter into force the month following completion of the ratification process and would apply to taxes levied or withheld the year after its entry into force. 

All rights reserved. Care has been taken to ensure that the content of this e-bulletin is as accurate as possible. However the accuracy and completeness of the information in this e-bulletin, largely based upon third party sources, cannot be guaranteed. The materials contained in this e-bulletin have been prepared and provided by Stibbe for information purposes only. They do not constitute legal or other professional advice and readers should not act upon the information contained in this e-bulletin without consulting legal counsel. Consultation of this e-bulletin will not create an attorney-client relationship between Stibbe and the reader. The e-bulletin may be used only for personal use and all other uses are prohibited.

Related news

05.02.2019 NL law
Transitional rules announced for certain Dutch tax acts in case of no deal Brexit

Short Reads - On 4 February 2019, the Dutch State Secretary of Finance sent a letter to the Dutch Parliament announcing transitional rules for Dutch taxes (other than customs legislation) if there will not be a Brexit withdrawal agreement (i.e. a no deal Brexit). The letter includes an outline of the transitional rules.

Read more

28.01.2019 LU law
The Grand Duchy of Luxembourg implements the Register of Beneficial Owners Law

Articles - The Grand Duchy of Luxembourg has fulfilled its European obligations in the fight against money laundering and the financing of terrorism by transposing Directive 2015/849 of 20 May 2015 (also known as the 4th EU AML Directive) into national law with the brand new Law of 13 January 2019 (the RBE Law). Below is an overview of the important disclosure obligations that will soon apply to a wide range of Luxembourg entities.

Read more

13.12.2018 BE law
Bushalte zonder vergunning en veranda zonder architect: valt uw project ook onder de nieuwe regels?

Articles - De Vlaamse Regering voert aanpassingen door aan de vrijgestelde handelingen, handelingen van openbaar belang, vergunningsplichtige functiewijzigingen en handelingen vrijgesteld van de medewerking van een architect. Onder meer wat betreft vrijstellingen en medewerking van een architect, wijzigt er toch wel wat.

Read more

07.12.2018 BE law
Virtual Currency Regulation Law Review

Articles - The first edition of the Virtual Currency Regulation Law Review is intended to provide a practical, business-focused analysis of recent legal and regulatory changes and developments, and of their effects, and to look forward at expected trends in the area of virtual currencies on a country-by-country basis.

Read more

Our website uses cookies: third party analytics cookies to best adapt our website to your needs & cookies to enable social media functionalities. For more information on the use of cookies, please check our Privacy and Cookie Policy. Please note that you can change your cookie opt-ins at any time via your browser settings.

Privacy – en cookieverklaring