,

Luxembourg Online IPT Filings – One Year On

Beverleigh Gunner
April 13, 2022

Insurance Premium Tax (IPT) in Luxembourg moved to online filing from the first quarter 2021 submission. Alongside this, they also changed the authority deadline to the 15th of the month following the quarter. This change caused some upheaval as many insurance companies were already pulling data from the underwriting systems, reviewing the information (sometimes manually), and ensuring the declarations would be correct for other territories also due by the 15th.

More European tax authorities going digital

Luxembourg wasn’t the first or last territory to move to an online platform. Germany and Ireland followed within a year of Luxembourg’s implementation. In contrast, French authorities have delayed implementing their online filing process until 2023. Additionally, more tax authorities require accounts for Direct Debit set up rather than the usual SEPA or priority payments being made with specific references.

Why is tax filing moving online?

It’s clear why tax authorities are moving to online platforms. Having a digital filing process is an easier and more efficient process for what could be thousands of declarations being submitted by various sources. Plus, online filing gives tax authorities greater visibility, meaning they have more opportunities for analysis. What puzzles us, is why so many tax authorities choose to have their deadlines on or around the 15th? This deadline only provides a short timeframe for insurance companies to close the month, pull the data and make the declarations.

IPT changes in Luxembourg

Apart from these updates, Luxembourg hasn’t implemented many changes in the past, regarding IPT. The most recent that we can recall is the introduction of the Tax for Rescue Services on Motor Class 10 policies, which came into effect on 1 October 2016.  As the tax rates are relatively low compared to other territories, it’s entirely plausible that we could see a future increase.

IPT is a niche tax that isn’t always at the forefront of the business radar. It wasn’t until we began to look at the actual process of filing the online declarations did we realize that the process is an adaption of what is used for VAT and other taxes or designed around domestic insurers rather than freedom of services. At least that’s what it seems for Luxembourg.

Over the past year, we have found that the online filing system has become quicker and easier to navigate, with the delays between authentication of a declaration taking seconds rather than minutes. The declaration is still similar to what was submitted on the paper form, breaking down the liabilities per class of business, entering the premiums and then an automatic application of the percentage rate.

Is this the end of territories moving to an online filing solution? Probably not. Will there be more digitization from tax authorities to bring IPT in line with most other tax reporting? We think so.

Take Action

Need to understand Luxembourg’s IPT requirements? Get in touch with our experts and keep up to date with ever-changing European IPT rules by following us on LinkedIn and Twitter.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.

Author

Beverleigh Gunner

As a director, compliance services for IPT, Bev leads the compliance function to fulfil its obligations to customers. Since joining the company in 2007, she has a wealth of dedicated IPT experience working across process management, business analysis, as well as continuing to drive our program of digitization.
Share This Post

E-Invoicing Compliance Latin America
December 6, 2022
E-invoicing in Guatemala

With the entry into force of resolutions SAT-DSI-1240-2021 and SAT-DSI-1350-2022, most taxpayers in the country are now obliged to issue electronic invoices under the Online Electronic Invoice System (Regimen de Factura Electronica en Linea – FEL). The latest taxpayers to join the mandatory electronic billing system are include taxpayers incorporated into the General Value Added […]

EMEA VAT & Fiscal Reporting
November 29, 2022
Expert Series Part V: New Roles for IT in the Wake of Expanding Global Mandates

Part V of V – Christiaan Van Der Valk, vice president, strategy and regulatory, Sovos  Click here to read part IV of the series.   Government-mandated e-invoicing laws are making their way across nearly every region of the globe, bringing more stringent mandates and expectations on businesses. Inserted into every aspect of your operation, governments are […]

EMEA IPT
November 23, 2022
Fire Brigade Tax in Slovenia

Problems encountered with Fire Brigade Tax rate increase in Slovenia Slovenia’s Fire Brigade Tax (FBT) has changed. The rate increased from 5% to 9%. This came into effect on 1 October 2022. The first submission deadline followed on 15 November 2022. Unfortunately, the transition has been plagued by problems. We discuss some issues and how […]

E-Invoicing Compliance EMEA
November 22, 2022
E-invoicing and Fiscal Digitization in Africa

African countries are following e-invoicing and continuous transaction control trends implemented rapidly by many countries around the globe. Each country in the continent is developing their variation of a tax digitization system. This means there is currently no standardisation with compliance requirements differing in each jurisdiction. A common transaction reporting feature among African countries is […]

EMEA VAT & Fiscal Reporting
November 22, 2022
Expert Series Part IV: New Roles for IT in the Wake of Expanding Global Mandates

Part IV of V – Ryan Ostilly, vice president of product and GTM strategy EMEA & APAC, Sovos Click here to read part III of the series.   Government-mandated e-invoicing laws are making their way across nearly every region of the globe, bringing more stringent mandates and expectations on businesses. Inserted into every aspect of your […]