Transfer Pricing Recruitment: Spotlight Series: Luxembourg
10 November 2016

Luxembourg, despite its size, is a truly cosmopolitan country with 46% of the population consisting of foreign residents. With a diverse range of nationalities and 100,000 people living centrally in Luxembourg City, multilingualism is an important part of Luxembourg life. French and German is of course prevalent, however English still remains extremely dominant within the professional services and in-house sectors.

Living in Luxembourg holds a number of attractions for expats. With one of the lowest unemployment rates in Europe, the country has the second-highest GDP per capita in the world at an astounding $102,900 USD. Despite the Global Financial Crisis, public debt remains lower than most EU countries and transfer pricing professionals can enjoy unique tax exemptions. Additionally, if you’ve enjoyed a short or medium term experience so much that you don’t want to leave, the application for citizenship has been recently simplified to ensure a much more straightforward process for expats.

Luxembourg transfer pricing overview

As part of the BEPS Project, the OECD Transfer Pricing Guidelines have been substantially rewritten over the last 3 years. On 25 May 2016, the European Council adopted a Directive that amends Directive 2011/16/EU with regard to mandatory automatic exchanges of information in the field of taxation. Among other changes, the Council introduced country-by-country (“CbC”) reporting to European Union law following the recommendations made by the OECD under Action 13 Base Erosion and Profit Shifting Action Plan (“BEPS Action Plan”).

The obligation of preparing a CbC report will apply to sizeable multinational enterprises for which the total consolidated group revenue exceeds €750 million. The CbC reporting concerns both MNE groups headquartered in EU Member States and those headquartered outside the EU. If the parent entity is headquartered outside the EU, one of the subsidiaries or branches established within the EU and appointed by the parent entity will be in charge of the CbC report on behalf of the parent2.

This amendment to the Directive does not address the public disclosure of income tax information by certain MNE groups as proposed by the European Commission on 12 April 2016.

Transfer Pricing careers in Luxembourg

Whilst Luxembourg is home to the world’s largest steelmaker - automotive, financial services, manufacturing and the technology sectors have developed significantly over the last decade. Both Skype and Amazon have European headquarters in Luxembourg, which has further assisted in promoting the city as a leading technology hub. What does this mean for transfer pricing professionals? The diversity and complexity of Luxembourg’s industry sectors ensures an extremely strong advisory focus to your projects.

With teams rapidly expanding, particularly in the Financial Services space – professionals can enjoy a generalist role whilst developing knowledge of Investment Banking, Asset Management, Private Equity and financial transactions. From a career development perspective this will allow you to specialise more deeply in financial services at a later stage or indeed, position yourself strongly for a high profile in-house regional role.

Unlike some EU countries that can have a heavy transfer pricing focus on documentation and compliance, projects are much more advisory led in Luxembourg.

These include:

  • Tax optimised corporate structures, cross-border financing and supply chain re-engineering.
  • Structured finance (private equity, hedge funds and sovereign funds).
  • Asset management and private banking/wealth management in addition to financial transactions.
  • Developing your understanding of the regulatory industry including AIFM/UCITS Directives, BEPS and double tax treaties/international tax and economic analysis.                  

TP International is currently working on a number of exclusive mandates for Transfer Pricing professionals with 3–8 years experience.  Whilst French or German language capabilities are highly advantageous, individuals with strong English language skills will be of high interest.

For a confidential discussion about opportunities in Luxembourg or more broadly within EMEIA, please contact Liz Tookey at lt@tpi-search.com