An Overview of the Future Luxembourg Intellectual Property Tax Regime

Abstract

On 4 August 2017, the Luxembourg Finance Minister introduced a draft bill setting out a new Intellectual Property tax regime for Luxembourg, intended to enter into force as from the 2018 tax year. The bill introduces a new article 50ter within the Luxembourg Income Tax Law. Based on this draft legislation, net income derived from eligible IP assets will (subject to a “nexus ratio” restriction) enjoy an 80% exemption for corporate income tax and municipal business tax purposes. The eligible IP assets will also benefit from a full net wealth tax exemption.