• Service: Tax, Global Indirect Tax, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 11/15/2013

Luxembourg - VAT exemption for risk management services 

November 15: Guidance from the Luxembourg tax authorities specifies the scope of a value added tax (VAT) exemption applicable with respect to the management of investment funds.

The circular (7 November 2013)—

  • Confirms that services of risk management are part of fund management services and, as such, would be in principle exempt from VAT, and would apply equally concerning the management of alternative investment funds
  • Confirms that management services provided by a third party (outsourced services) generally form a “distinct whole” specific to and essential for the management of funds in order to qualify for the VAT exemption
  • Provides the VAT exemption does not apply to purely material or technical services
  • Clarifies that a single isolated type of service (un seul type isolé de services) supplied by a third party cannot benefit from the VAT exemption

Read a November 2013 report [PDF 127 KB] prepared by the KPMG member firm in Luxembourg: VAT exemption of risk management services

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