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Elodie Schmidt

Elodie Schmidt is a Tax KM Manager in Baker McKenzie's Luxembourg office.

On 28 January 2021, the Luxembourg Parliament (Chambre des Députés) adopted1 bill of law 7547 on the non-deductibility of interest and royalty payments made to related parties in non-cooperative jurisdictions (“Law”).

As explained in our tax alert dated 20 April 2020, the new provision amends Article 168 of the Luxembourg Income Tax Law (LITL), which lists non-deductible expenses for taxpayers subject to corporate income tax. The Law therefore completes the scope of non-deductible expenses by adding a rule of non-deductibility of interest or royalty expenses paid by a Luxembourg taxpayer to a related company established in a country or territory appearing on the list of the EU as a non-cooperative tax jurisdiction.

On 9 August 2019, the Luxembourg Parliament publicly released the bill of law 7465 implementing the European Union (EU) Directive 2018/822 of 25 May 2018 on mandatory disclosure requirements for intermediaries (DAC6 or the “Directive”). These new provisions, applicable only to direct taxes, will require intermediaries and, in certain situations, the taxpayer itself…