On 15 December 2022, the Luxembourg Parliament approved the budget law 2023. There is no major tax reform or an increase in the tax rate in the draft budget law. Most of the measures will apply from 1 January 2023. The budget law sets out the following main tax measures:
Extension of deadline for tax returns
The deadline for filing tax returns will be postponed to 31 December of each year from 2023. The extension will apply to corporate tax returns, individual, and municipal business tax from the tax year 2022, and net wealth tax returns from the tax year 2023.
Reverse hybrid entity rule
The budget law amends Article 168 quater of the Luxembourg Income Tax Law (LITL) regarding reverse hybrid entity rule in line with the ATAD 2 directive applicable from 1 January 2022.
