Hybrid mismatch rules in Luxembourg: Analysing the impact on Alternative Investments (Private Equity, Real Estate, …)


We’re taking our ATOZ Briefings on-line!

ATOZ Briefings are seminars offered by ATOZ to ensure that our clients are ahead of the curve on specific topics which may affect their areas of business.

In these extraordinary times, we stand by our clients and adapt to a new reality, keeping everybody informed through a series of hybrid briefings on current tax topics: you will be able to choose between attending physically (following COVID-19 health and safety regulations) and watching the live streaming from your home or office.

Oliver R. Hoor will therefore be hosting a series of Briefings, over the next few weeks, partnering with Legitech.

This webinar, taking place on 12 November 2020 at 10:30AM CET, is entitled Hybrid mismatch rules in Luxembourg: Analysing the impact on Alternative Investments (Private Equity, Real Estate, …)”.


Hybrid mismatches typically originate from a different tax treatment of an entity, a permanent establishment or a financial instrument under the laws of two or more jurisdictions and may result in deduction without inclusion or double deduction outcomes. In general, the hybrid mismatch rules target hybrid mismatches between associated enterprises, structured arrangements between third parties, imported hybrid mismatches and tax residency mismatches.

At the same time, the hybrid mismatch rules should not create economic double taxation. This is ensured through a number of carve-outs and limitations that discharge the application of the hybrid mismatch rules (for example, timing differences, inclusion of the payment at the level of any payee, tax exempt status of the investor, transfer pricing adjustments).

The hybrid mismatch rules are characterised by an extreme complexity that demands not only deep knowledge of Luxembourg tax law but also a good understanding of the tax laws of all foreign jurisdictions involved, ATAD 2 and the Final Report on BEPS Action 2 which is explicitly mentioned as a source of interpretation.

This briefing (which will be simultaneously streamed online) aims at providing participants with a clear overview of the new hybrid mismatch rules, analysing how these rules may impact Alternative Investments and multinational groups in Luxembourg and considering opportunities to manage the impact of the hybrid mismatch rules.



  • Introduction
  • Typical investment structures
  • Impact of the hybrid mismatch rules on investments
  • Related party test (associated enterprises, acting together and de minimis rule)
  • Considerations regarding Luxembourg and foreign funds
  • Solutions for managing the impact of the hybrid mismatch rules
  • Limits of the hybrid mismatch rules
  • How to deal with the hybrid mismatch rules in practice
  • Considering potential imported hybrid mismatches in the EU investment jurisdictions
  • Practical case studies
  • The reverse hybrid mismatch rule (as from fiscal year 2022)


Please note that space is limited due to COVID-19 but you can attend this event from your home/office thanks to a live streaming.

For more information and registration, please contact events@atoz.lu.

ATOZ Speaker