Luxembourg Provides Guidance on Application of Pillar 1 Amount B

The Luxembourg Administration of Direct Tax has issued Circular L.I.R. No. 56/2 - 56bis/2 of 13 April 2026. The Circular sets out the terms and conditions for the application of the OECD Report on Amount B, which was developed as part of Pillar 1 of the Two-Pillar Solution to simplify and standardize the application of the arm's length principle for baseline marketing and distribution activities.

While Luxembourg has not adopted the Amount B approach, the Circular provides that Luxembourg …