Grow your business with our accounting and tax services

On 15 December 2022, the Luxembourg Parliament voted to approve the 2023 Budget. The 2023 Budget Law provides for an extension of the filing deadlines for certain direct tax returns. Corporate income tax and municipal business tax returns of a given year should now be filed by 31 December of the following year. For NWT, the return of a given year should be filed at the latest on 31 December of that year, since the return is based on the balance sheet as at 1 January of the tax year.

In practice, the Luxembourg Tax Authorities typically extended the filing deadline to 31 December without imposing late filing penalties. The Budget Law 2023 simply puts practice onto a statutory footing that will clearly provide more legal certainty to taxpayers.

The new filing deadlines are to be applicable to corporate income tax and municipal business tax returns related to 2022 and to net wealth tax returns for 2023.

Failure to submit a tax return may be subject to a penalty of 10% of the tax due and a fine up to EUR 25,000.

Tax advances payments are computed by the tax administration based on the previous liability assessed in the prior tax year. Tax advances are paid quarterly.

A written request needs to be submitted to the tax authority explaining the events leading to a decrease of the turnover of the Company as well as supporting documents, such as an interim financial situation showing a slowdown in activity or margin decreases etc.

As soon as the Company is incorporated by the notary and published in the LBR (“Luxembourg Business Register”) the respective tax authority from the Comune where the Company is registered issues the tax number which starts with the year of registration following by 7 digits (example: 2023 xxxx xxx)

To obtain a VAT number, a Company has to register for VAT. In order to register for VAT, the taxable person must submit an initial declaration or a declaration of option corresponding to their situation to VAT office (AED). The Company has to submit the following:

1. For a company:

• • name of the company;
  • legal form;
  • address of the registered office;
  • date of the constitutional documents and, for Luxembourg companies, if available, the number of the official journal (Mémorial C) or of the electronic compendium of companies and associations (Recueil électronique des sociétés et associations– RESA) in which they were published, otherwise indicate “Publication à venir” (publication will follow);
  • names and addresses of named partners listed in the constitutional documents and/or business managers/directors of the company;
  • for individuals:
    • surnames and first names of the taxable person;
    • civil status;
    • type and place of activity;
    • complete private contact details;
• a bank account or a postal checking account (CCP) number at a Luxembourg or foreign bank (IBAN + BIC);
• date of the start of the activity, which determines the first period for which a VAT declaration will have to be submitted;
• financial year;
• forecast or otherwise of intra-Community acquisitions and deliveries of goods or services;
• estimation of the anticipated annual turnover excl. tax. This estimate will be one of the elements used to determine the periodicity for filing declarations.

For tax compliance we work with fixed fees for companies and independent with an number of transactions lower than 200 per year:

• Corporate income tax return – EUR 400 per year
• Annual VAT return – EUR 400 per year
• Monthly VAT return – EUR 125 per month
• Quarterly VAT return – EUR 200 per quarter

However if you combine accounting services with tax compliance and VAT you can obtain a very good discounted deal from us. Don’t hesitate to contact us.

Generally the fees are built based on the number of transactions in your company. You can count one transaction as being 1 invoice, 1 payment, 1 salary accounting record or one accrual. Based on the estimated number of transactions we estimate a total number of hours to be spent (ie. for 200 transactions we take approximately 12 hours of work and our hourly rate is EUR 150 per hour without VAT). However depending on the volume of work, we are working with discounted hourly rate up to 30%. Than on top we consider compiling financial statements, for which we have a fixed fee of EUR 500 per year.

Outsourcing accounting services can provide several benefits, including reduced costs, increased accuracy, and improved financial reporting.

Accounting firms can help clients with financial reporting by preparing financial statements and providing guidance on how to interpret the financial information.

For accounts payable and accounts receivable, accounting firms can help manage invoices, payments, and collections.

For payroll services, accounting firms can help manage payroll processing, tax withholdings, and other related tasks.

Financial planning services in Luxembourg can include retirement planning, estate planning, investment management, and more.

Accounting firms can help clients create budgets by analyzing their financial statements and developing a plan for managing their income and expenses.

Together we will establish a fixed number of transaction and a fixed fee will be charged. At the end of the year based on the actual amount of work, based on a time sheet will be provided to you and if the number of transactions increased significantly and this is also supported by our timesheets we can agree and an additional charge.

Also if the number of transactions decreased and the time spent by our team is lower that initially budgeted, we will decrease our fees and do a regularization at the end of the year. Our goal is to create a flexible product that meets your requirements and remunerate our actual time spent with your Company.