Tax Haven Luxembourg


The European country of Luxembourg is situated in Western Europe and is bordered by Germany, France and Belgium. The official languages spoken in the Grand Duchy of Luxembourg are French, German and Luxembourgish. The country has an estimated population of a little over 500,000 people. Luxembourg has become one of the more popular tax havens located on the European continent. Luxembourg is a tax haven and has a vibrant banking sector. Luxembourg also offers offshore insurance, investment fund management and the registration of ships and vessels.


The tax havens of the world are classified as countries or territories which provide services to a client based mostly made up of non residents. The tax havens have very low or no taxes at all in place and are very efficient at providing privacy and confidentiality for clients.


The tax haven of Luxembourg is one of Europe’s leading financial centers. In fact the tax haven of Luxembourg is considered to be the second largest banking centre on the European continent. Offshore banking in the tax haven of Luxembourg gained momentum in the 1970’s. Today as banking center tax haven Luxembourg has branches for most of the world’s leading financial institutions. The tax haven of Luxembourg has at least one hundred and fifty (150) banks offering services to both residents and non residents of the tax haven.


As a tax haven Luxembourg does not tax the interest gained by offshore bank accounts. Offshore bank accounts in the tax haven of Luxembourg are a guaranteed means of increasing capitals whilst at the same time receiving quality asset protection. In the tax haven of Luxembourg offshore bank accounts are very easy to establish and maintain.


In the world of offshore banking, banking secrecy has become a cornerstone. In many tax havens of the world banking secrecy is a key feature. In Luxembourg the privacy of offshore bank account holders is highly regarded. Banking Secrecy has kept the tax haven of Luxembourg very popular as a tax haven since more and more people are trying to find tax havens which will protect them and their investments. All information in offshore bank accounts in the tax haven of Luxembourg is regarded as confidential and cannot be given out without the written authorization of the offshore bank account holder.


Since offshore banking is very important in the tax haven of Luxembourg the offshore banks in the tax havens go to great lengths to ensure that quality products and services are received by all their clients. Offshore banks in the tax haven of Luxembourg are well known for providing quality and sophisticated banking services. Some of the bank services available for offshore bank clients in the offshore tax haven of Luxembourg include international credit cards, debit cards, internet banking, bank accounts in multi currency, banking via the telephone and issuing bank drafts among other services.


The tax haven of Luxembourg does not incorporate offshore companies but there are certain forms of Luxembourg companies which can take advantage of tax exemptions in the tax haven. A Luxembourg Holding Company or SOPARFI is a resident company in the tax haven of Luxembourg which operates subsidiaries. The Luxembourg holding company is permitted to carry out offshore activities. This company is exempted from paying taxes on dividends if it holds for the least 10% of a subsidiary for a period of one (1) year or more. A Luxembourg holding company will also be exempted from paying taxes on dividends if the company has already been charged corporate taxed of a at a rate of 11 % or more.


Holding companies incorporated in the tax haven of Luxembourg can get exempted from paying withholding taxes if the beneficiary is another Luxembourg holding company or a Company incorporated in the European Union. In the tax haven of Luxembourg a holding company can be exempted from paying capital gains tax.


When incorporating a holding company in the tax haven of Luxembourg there is no need to declare to the authority who the beneficial owners of the company are. A holding company in tax haven Luxembourg can be incorporated using one (1) director and one (1) shareholder. The director can be a natural person or a corporation.


The tax haven of Luxembourg continues to be the tax haven of choice for many persons around the world. The country is very stable both economically and politically. Luxembourg as a tax haven has been able to provide clients with safe asset protection. Luxembourg has been able to provide offshore bank account holders with banking secrecy and privacy for decades and will continue to do so well into the future as the government authorities of Luxembourg are very supportive of the country’s offshore banking sector and are constantly putting measures in place which will improve on the tax haven competitiveness.


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