Directors are subject to VAT in Luxembourg
Luxembourgish Directors acting independently and providing services to another company must charge VAT in Luxembourg on these supplies.
New guidelines for all directors in Luxembourg
The tax authorities have published guidelines on the VAT treatment of these supplies where they clarified that Directors who are not employed by the company to whom they are providing services must register for VAT and charge VAT on these supplies.
What if the supply is provided from a director outside Luxembourg?
Should the supply be made from a Director outside Luxembourg, the company receiving the service must account for VAT under the reverse charge mechanism. According to the new circular, it is now clear that Directors should register and account for Luxembourg VAT when supplying services to another company. Please do not hesitate to contact us in case you need help with your VAT registration and VAT returns in Luxembourg.