LUXEMBOURG Law and Practice Contributed by: Frédéric Feyten, Alejandro Dominguez Becerra, Gérard Maîtrejean and Pawel Hermeliński, CMS
this information with the concerned tax authorities. This automatic exchange of information is designed to combat tax evasion and ensure tax compliance on a global scale. • DAC6 – Luxembourg has also implemented the EU’s Directive on Administrative Cooperation (DAC), including DAC6, which imposes mandatory disclosure requirements on intermediaries and, in some cases, taxpayers themselves. Any cross- border arrangement that meets certain hallmarks indicating potential tax avoidance or evasion must be reported to the Luxembourg tax authorities, who then share this information with other EU member states. This has increased the level of scrutiny on cross-border tax planning and has led to greater caution and transparency in structuring arrangements for clients. • Beneficial ownership registers – Luxembourg maintains a dual-register system for beneficial ownership in line with EU anti-money laundering directives. The register of beneficial owners (RBO) applies to corporate entities and other legal struc - tures, while a separate register covers trusts and foundations. Although public access to the RBO was suspended in November 2022 following a rul - ing by the Court of Justice of the European Union (Joined Cases C-37/20 and C-601/20), access remains available to professionals subject to anti- money laundering obligations and to the entities concerned. • Luxembourg national identification number – since March 2022, all individuals listed in the Luxem - bourg Trade and Companies Register (RCS) – such as shareholders, directors, managers, and auditors – must provide their Luxembourg national identifi - cation number (LNIN), enhancing traceability and regulatory oversight. • Digital assets and future obligations – looking ahead, Luxembourg is preparing for new EU tax transparency obligations concerning digital assets within the framework of the adopted EU Coun - cil Directive (EU) 2023/2226 of 17 October 2023 amending Directive 2011/16/EU on administrative co-operation in the field of taxation, which should be transposed into Luxembourg legislation by the end of 2025 (DAC8). DAC8 is aligned with the OECD’s Crypto-Asset Reporting Framework and
introduces reporting duties for crypto-asset service providers as of 1 January 2026. While Luxembourg remains an attractive and stable jurisdiction for private wealth, clients must approach planning with a focus on transparency, compliance, and adaptability to ongoing regulatory developments. 2. Succession 2.1 Cultural Considerations in Succession Planning In Luxembourg, succession begins on the date of death and is governed by the law of the country of habitual residence of the deceased, regardless of their nationality. Inheritance tax applying to the estate of a deceased Luxembourg resident are, in principle, payable on the value of movable and immovable property located in Luxembourg. This is known as the “ masse successo- rale ” (inheritance estate), which consists of: • the assets of the estate, consisting of assets exist - ing at the time of death, namely: (a) movable property such as furniture, cars, shares, money, paintings, etc, located in Lux - embourg or abroad if they are not subject to an inheritance tax due to the nationality of the deceased; and (b) immovable property located in Luxembourg, less: • the liabilities of the estate, consisting of existing debts (private or professional) on the day of death (and the related interest), taxes still to be paid, and funeral expenses. All the assets of the deceased are in principle valued according to their market value on the day of death. If the deceased was married on the day of death, the estate includes his/her own property and share of common property. It will be necessary to refer to the matrimonial regime of the spouses in order to deter -
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