VAT registration in Luxembourg
VAT registration is generally required when establishing a company in Luxembourg or starting an activity as a self-employed individual. This VAT registration is necessary to commence any activity subject to Value Added Tax (VAT). A taxable person is defined as anyone who independently and regularly carries out an economic activity1. The intention of starting a business or more precisely to engage in taxable activities may suffice to recognize the company as a taxable person2.
Enrolling in the register of taxable persons for VAT
To obtain a VAT number, any company or self-employed individual in Luxembourg must be registered in the register of taxable persons for VAT. This requires submitting an initial declaration to the VAT Authorities, the Administration de l’Enregistrement, des Domaines et de la TVA (AEDT) within 15 days following the start of the activity. The declaration must be accompanied by certain documents, such as the business license.
Modifying the register of taxable persons for VAT
Any significant change in the company's activity must be communicated to the AEDT promptly. This may include expanding the corporate purpose, changing the legal form, or any other modification that significantly affects the company's activity.
VAT deregistration
Upon cessation of activity, the taxable person (i.e. a company or a self-employed individual) must inform the AEDT within 15 days of the partial or total cessation of activity. The taxable person then has two months to submit an annual VAT return. In principle, expenses incurred after the cessation of activity, when directly and immediately linked to the previously present economic activity, can be considered as general expenses. They may therefore qualify for VAT deduction, as long as they are not associated with fraud or abuse3.
1. Article 4 of the amended law of 12 February 1979 concerning value added tax (LVL).
2. CJEU, Case C-110/94 dated 29 February 1996, "INZO".
3. CJEU, Case C-32/03 dated 3 March 2005, "Fini H".
