Luxembourg: Payment service providers VAT legal package

Draft law 8207 unanimously adopted in a first vote

Draft law 8207 unanimously adopted in a first vote

Draft law 8207—implementing the new reporting obligations for payment services providers (PSPs)—was unanimously adopted in a first vote on 19 July 2023.

The EU legal package is constituted by a directive amending the value added tax (VAT) directive and an (updated) regulation.

As part of the PSP legal package, a new European reporting entity is created: the “Central Electronic System of Payment” (CESOP). As the regulation did not require any national implementation measure, only the directive was translated into national terms by the release of draft law 8207 on 5 May 2023.

Next steps

PSPs falling within the scope of the directive/law are required to collect and report the data information for the payment transactions (above 25) as from 1 January 2024 to their national tax authorities.

The first obligation requirements on PSPs will therefore cover the payment transactions occurring from January to March 2024.

Further, once the data has been collected by the member states’ national tax authorities, the latter will transmit the file to the CESOP by the 10th day of the second month following the end of the reporting period (i.e., by 10 May 2024). 

Additional information

The European Commission on 23 June 2023 published a draft “questions and answers” regarding the CESOP reporting frequently asked questions (FAQs).

The document aims to provide practical information and explanations on the reporting and to answer a certain number of questions asked by the member states. The European Commission also indicated that this document is still a draft and will evolve before finalization.

It also refers to an updated version of the XSD user-guide to be used when filling in the reporting document (released by the national competent tax authorities).

Finally, the Luxembourg VAT authorities have also set up a CESOP-related page on their website that gathers all CESOP information available and that will be used for Luxembourg-specific communications.

The VAT authorities are also expected to have information sessions during the fourth quarter 2023.

Read a July 2023 report prepared by the KPMG member firm in Luxembourg



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