LUXEMBOURG: “DAC 2” LEGISLATION INTRODUCED; CRS-LIKE REGIME
A bill submitted to the Luxembourg Parliament in November 2015 would transpose, into Luxembourg domestic law, an EU directive amending a 2011 directive for administrative cooperation and concerning the exchange of information on request. The directive (2011/16/EU) as amended, is referred to as “DAC 2” (the updated “directive on administrative cooperation”).
BACKGROUND
The EU Council in December 2014 adopted DAC 2 to amend Directive 2011/16/EU on administrative cooperation in the field of taxation—a step towards the adoption of a FATCA-like automatic exchange of information mechanism throughout the European Union. Under the amended directive, beginning in 2017, information related to fiscal years, measured from 1 January 2016, will be exchanged on an automatic basis between EU Member States.
The EC published lists of “excluded accounts” and “non-reporting financial institutions.” For Luxembourg purposes, three categories of accounts are considered to be “excluded accounts”—
- Personal pension contracts (Comptes ouverts en vertu d’un contrat prévoyance-vieillesse visé par l’article 111bis de la loi modifiée du 4 décembre 1967 concernant l’impôt sur le revenu)
- Housing savings contracts (Comptes ouverts en vertu d’un contrat d’épargne-logement visé par l’article 111 alinéa 1er de la loi modifiée du 4 décembre 1967 concernant l’impôt sur le revenu)
- Occupational pension schemes (Comptes ouverts en vertu d’un régime complémentaire de pension visé par l’article 110 de la loi modifiée du 4 décembre 1967 concernant l’impôt sur le revenu)
For Luxembourg, no entity is included in the list of “non-reporting financial institutions.
WHAT’S NEXT?
The next steps for enactment of DAC 2 and the common reporting standard (CRS) in Luxembourg would be:
- Voting by the Parliament on the bill of law transposing the DAC 2 into Luxembourg domestic law
- Publication of the Luxembourg lists of participating jurisdictions and reportable jurisdictions
Both of these actions are expected to happen before the end of 2015.
Read a November 2015 report [PDF 103 KB] prepared by the KPMG member firm in Luxembourg: DAC 2 – New Developments
