Pillar Two: Luxembourg Implements Additional OECD Guidance

On 19 December 2024, Parliament has approved the bill of law implementing additional elements of the 2023 and 2024 OECD guidance pieces regarding Pillar Two rules (global minimum taxation). This additional law provides greater legal certainty to taxpayers as regards several elements of the guidance.

Once the law is published, these amendments will apply to tax years starting on or after 31 December 2023, i.e., from the initial application date of the Pillar Two rules already implemented. Additional guidance will be implemented, to the extent legislative action is required, by means of additional laws.

Background

The initial Pillar Two law of 22 December 2023 did not explicitly incorporate certain elements of the agreed OECD administrative guidance adopted respectively in February and July 2023, and it did not at all incorporate guidance released by the OECD in December 2023 and in June 2024. Therefore, the government had already announced plans to revisit the