A SICAV SIF is not subject to Luxembourg taxes on capital gains or income and there is no liability to Withholding Tax on distributions, including the redemption of shares.  Distributions made by a SICAV SIF or capital gains realised from the sale, refund or repurchase of the shares in a SICAV should be out of the scope of the EU Savings Directive since it is not subject to ‘UCITS’ rules.  (It is recommended that tax advice is obtained).

Additionally, Luxembourg has concluded around 50 double taxation treaties and it should be possible to structure a SICAV SIF to benefit from the majority of these.  Double Tax Treaties

A SICAV SIF is, however, subject to capital duty, levied at the time of creation or subsequently – in particular when new contributions are made or when a fund is converted or merged. It is charged at a fixed rate of EURO 1,250 per operation.

An annual subscription tax of 0.01% is levied, based on the quarterly net asset value.

Certain exemptions apply:

• Assets of investment funds which have already been subject to the subscription tax.
  
  
• Investment funds and sub-funds of umbrella funds whose exclusive object is the collective investment in money market instruments and the placing of deposits with credit institutions, and whose weighted residual portfolio maturity does not exceed 90 days, and that have obtained the highest possible rating from a recognised rating agency.
  
  
• Investment funds whose securities are reserved for (i) institutions for occupational retirement provision, or similar investment vehicles, created on the initiative of a same group for the benefit of its employees and (ii) undertakings of this same group investing funds they hold to provide retirement benefits to their employees.

N.B. Specialist Tax advice should be sought.