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Following the Court of Justice of European Union (CJEU) decision in case C-288/22 and the subsequent judgment of the Luxembourg District Court on 22 November 2024, the Luxembourg VAT authorities (AED) issued Circular N° 781-2 on 11 December 2024.

On March 11, 2025, The Council of the European Union officially adopted the VAT in the Digital Age (ViDA) Package! From now on and progressively until January 2035, a comprehensive set of measures aimed at simplifying and modernizing VAT rules for the Digital Age will follow.

On November 5, 2024 The Council of the European Union, after long negotiations, announced that the EU’s Taxation Council has reached an agreement on the VAT in the Digital Age (ViDA) package.

On 22 December, the Administration de l’enregistrement, des domaines et de la TVA (“AEDT”) has issued circular no 781-1 on VAT on directors’ fees.

Following the CJEU’s decision C-288/19, “QM” of January 20th, 2021, the VAT treatment of company cars granted by a company to its employees should be modified for most cases applied by Luxembourg companies. Following this “QM” case-law, in the event where a company provides company cars to its employees, and provided the below conditions are met, this supply corresponds to a VAT taxable activity on which VAT must be collected by the company and accordingly declared to the VAT Authorities

Further to our tax alert “European Union reaches an agreement on minimum corporate tax”, we would like to share information on the measure concerning Pillar 2. Learn more

Further to our tax alert “Luxembourg’s newly proposed tax measures”, we would like to share information on the measure concerning the decrease of Luxembourg VAT rates for year 2023. Learn more

In the case C-288/19, the Court of Justice of the European Union recently decided on the VAT treatment of company cars, which are put at the disposal of the company’s employees for private use. Read more

On 11 June 2018, a new circular (765-1) was issued by the Luxembourg VAT authorities (Administration de l’Enregistrement et des Domaines) in order to clarify the application of circular 765 issued on 15 May 2013 regarding the calculation of deductible input VAT for companies that have a partial VAT activity (i.e. an activity that is partially out of the scope of VAT). Our Grant Thornton Luxembourg Tax experts can help you.