We want to inform you that as of January 1^st, 2015, some rules on VAT on Electronic Commerce (eTVA) are subject to a change, especially those stipulations concerning the place of service.

• What are the services involved?
  • Telecommunications Services,
  • Radio Broadcasting Services,
  • Televisions Services,
  • Electronic Services.

• What are the Persons involved?

Persons concerned are Companies subject to VAT established or not established in the European Union that provide the services mentioned above, to Persons Not Subject to VAT, having their domicile or usual residence in the territory of the European Union and in which the companies do not have a permanent establishment and VAT number.

From January 1^st, 2015, all of these services will be taxed in the Member State of residence of the Consumer.

• What are conséquences ?
  • Service Providers must report and pay VAT in each Member State of Consumers.
  • The services will be taxable at the rate of VAT applicable in the country where consumers have their Residence.

In order to avoid that Service Providers should not be subject to administrative procedures in each country of the European Union, the tax authorities in each country have agreed to create a platform named « Mini One Stop Shop – VATMOSS ».

VATMOSS allows Providers to indicate a Member State as a point of contact for electronic identification, declaration and payment of VAT. The selected state will link with other Member States.

• How to register with the VATMOSS?

Companies can already register on the platform and VATMOSS since 01st October 2014. To do this, Companies have to obtain a “LuxTrust Card”. If the Company does not have such a LuxTrust card, it will have to apply first for such card in advance because no application can be made without said card.

From the VATMOSS platform, the following services are offered:

• Appointment of an agent to manage your business;
• To follow the processing of declarations of the Company;
• To follow the payments and transfers between Member States;
• To access multiple views of statements (by country of consumption by country of establishment, …)

For recall, the Declaration through VATMOSS concern only e-services rendered to non-taxable persons established in a Member State of the European Union.

• How is functioning VATMOSS platform?

Companies must deposit a quarterly VAT return including all amounts of services mentioned above.

In the case where the Company did not have issued any invoice for a quarter, it will be obliged to file a “nil” return.

The deadlines for filing are:

• April 20
• July 20
• October 20
• January 20

In case of absence of such declaration within 30 days after the end of the quarter, a reminder will be automatically issued by the State Member Identification. The following reminders will be issued by each Member State on the basis of statements already introduced.
When the VAT return is filed on the platform, the Company must pay VAT due, at the latest, on the due date for filing the tax declaration.

• Exit VATMOSS :

The Company may leave the system VATMOSS on request. In this case, the Member State of identification will notify to the Company, the registration of its termination request and confirm this event with an expiration date.

The Member State of identification may also exclude a Company of VATMOSS system for repeated non-compliance with the rules in force.

Do not hesitate to come back to our office if your company is concerned by the new European Directive Application. We remain at your disposal for any further information requests made in writing.

C.G.E. Sàrl

Membre de l’Ordre des Experts Comptables

M.I. FLORANGE
W. VAN CAUTER
E. SNAUWAERT
Associés

Source : http://www.aed.public.lu/tva/commerce-electronique/index.html

We would like to inform you that rates of VAT in the Grand Duchy of Luxembourg will increase from January 1^st, 2015. A draft law (draft 6720 October 15, 2014) was introduced in Parliament and unless modifications on their part rates should have the following modifications:

• The standard rate will increase from 15% to 17%,
• The interim rate increase of 12% to 14%,
• The reduced rate will increase from 6% to 8%,
• The super-reduced rate unchanged at 3% except as it concerns:
  • Operations in the trade of alcoholic and “spirit” beverages,
  • The assignment of a house/appartement for a primary residence in the hands of a third party.

In such case, the rate increase from 3% to 17%.

A short summary (not exhaustive):

• The super-reduced rate is applicable to the great majority of consumer products, such as: beverage (excluding alcohol), food and catering, water supply, access to cinemas, sports facilities, or drug.
• The reduced rate is a marginal rate that applies only to some goods and services such as hairdressers, retouching services, shoemakers, companies window cleaning and cleaning in private households.
• The intermediate rate includes the following goods and services: heating oil, wine sales titrating 13 ° or less, custody and management of securities in banks, …
• The standard rate includes all the rest.

The VAT increase will applicable from January 1^st, 2015. Some questions were asked to the VAT Administration concerning Advances and Credit Notes.

The replies were as follows:

• Advances :

A special provision of the law provides for application of VAT at the moment of receipt. This means that when a person executes a payment in 2014, it will be subject to VAT at 15% and when the final payment will be made in 2015, the balance will be subject to 17% VAT.

• Credit Notes :

From the point of view of the law, a credit note is to be considered as an invoice. Therefore, the rules of application of VAT are in use. However, if an invoice is issued in 2014 at a rate of 15% and a credit note would cancel this invoice in 2015, it should be issued at a rate of 17%. However, the VAT Administration would accept that in such cases the credit note is issued at the rate initially charged. This implies that companies can still use the old rate for such cases.

For our clients and / or relations, for which the accounting service, is not organized by our office, we recommend you to contact your Accounting Software Provider as to make the necessary changes before the January 1^st, 2015.

C.G.E. Sàrl

Membre de l’Ordre des Experts Comptables

M.I. FLORANGE
W. VAN CAUTER
E. SNAUWAERT
Associés

Source : http://www.aed.public.lu/functions/faq/tva_2015/index.html

A few months ago, a proposition of law (No. 6625) was introduced by the Finance Minister in the Chamber of Deputies on October 3, 2013 concerning the Immobilization of Shares and Bearer Shares.

This project had as main objective for Luxembourg to adapt its legislation on transparency and exchange of information for tax purposes in the identification of holders of Shares and Bearer Shares. These requirements were increasingly sought by international organizations including the FAG (Financial Action Group) and / or the Global Forum on Transparency and Exchange of Information.
The Luxembourg Government has chosen an appropriate way to meet the needs of their partners on one side and to maintain confidentiality to the Shareholders on the other side. To this end, it created the role of “Professional Depositary”.
This Act was passed by Parliament and published in the Official Journal of the Grand Duchy of Luxembourg MEMORIAL year dated August 14, 2014 under A – No. 161.

1. 1.     What are Legal Persons involved :

Limited Companies, Partnerships Limited by shares and management companies of undertakings for collective investment established in the form of mutual funds that have issued Shares or Bearer Shares.

1. 2.     What actions result of this new Law ?

The Management of companies which have issued Shares and Bearer Shares is required to appoint a   “Professional Depositary” within six months the entry into force of the Law, on or before February 18, 2015.

This Depositary holds Shares in deposit on behalf of the shareholder who is the owner.

The Management will also be required to file with the Register of Commerce and publish the Memorial C, the extract on the Appointment and Termination of the « Professional Depositary ».

List of Professional Depositories designated in the Law published in the August 14, 2014 :

-       Chartered Accountants
-       Public Auditors and Certified Public Auditors
-       Credit Institutions
-       Professionals in the Financial Sector
-       Wealth Managers
-       Lawyers
-       Notaries

The Depositary shall be in no case a Shareholder of the issuing company.

1. 3.     How is organized the transfer of the Shares and Bearer Shares with the Depositary ?

The Owner gives its Shares and Bearer Shares within 18 months of the entry into force of the law on or before February 18, 2016, to the Depositary who shall proceed to the inscription  in the registry. At the written request of the Holder, the Depositary may give him a certificate confirming registration in the Register of Shares and Bearer Shares delivered by the Holder.

Included are also following informations :

-       The exact description of the Sharholder
-       The indication of the number of shares
-       The date of deposit
-       The confirmation of transfert or conversion into registered shares and the date

Each Owner of Bearer shares may only be aware of the  entries him concerning.

1. 4.     What happens to the voting rights attached to the Shares and Bearer Shares ?

If the Shares have not been converted in a period of 6 months from the entry into force of the law voting rights are suspended including rights to dividend, including their admission to general meetings.

1. 5.     What happens to Shares that haven’t been immobilized ?

If the shares were not converted in a period of 18 months from the entry into force of the law then there shares should be offset by a reduction in the subscribed capital by a corresponding amount.

1. 6.     On which conditions a Depositary can be dispossessed of listed shares on the books ?

The Depositary can not be dispossessed of the Shares except in the following cases where it must return the shares:

-       To his successor in the event of termination of services,
-       To the Company upon conversion of bearer shares into registered shares, upon redemption by the Company of its own shares in accordance with the law of 10 August 1915 on commercial companies,

Please note that the responsability of the Depositary is incurred if it derives its obligations set out in the law, the same rules, are as well applicable to the management body.

1. 7.     What other fines and penalties exist ?

The Management can be condamned to criminal sanctions if it does not meet the legal obligations of its responsibility, or a fine of 5,000.00 to 125,000.00 EUROS for:

-       The non-appointment of a the Depositary under the law passed ;
-       If it recognizes the rights attached to the Shares in violation of the provisions cited in the law passed;
-       If it does not annulate the shares which are not capitalized, as reflected in the law passed.

Dear Customers, Dear relations, in our capacity as Chartered Accountant, we can act as the Professionnal Depositary of Shares.

In case your company has issued Shares on Bearer Shares, we remain at your disposal to give you more information about what to do in your personal case.

C.G.E. Sàrl

Membre de l’Ordre des Experts Comptables

M.I. FLORANGE
W. VAN CAUTER
E. SNAUWAERT
Associés

The full text of the new law published in Mémorial A N ° 161 of 14 August 2014 “Property, Shares and Bearer Shares” can be accessed via our website:

Source : http://www.legilux.public.lu/leg/a/archives/2014/0161/index.html