Ch. 11BEGINNER ~15 mins

Expenses & Taxation

Taxe d'abonnement, TER, VAT and withholding taxes

Formation expenses are the costs to establish a UCI (or a new compartment) and get it ready to operate. They are separate from initial capital requirements. Normally borne by the fund unless the ManCo/GP agrees to absorb them. Under Lux GAAP, they can be amortized over up to 5 years.

▸Notary fees — for incorporation, constitutional documents, official filings
▸Legal fees — structuring advice, regulatory review, subscription documents
▸Advisory fees for initial structuring
▸Printing the prospectus/offering document
▸CSSF initial authorization fee: single compartment UCI — €4,650
▸CSSF initial authorization fee: multiple compartment UCI — €9,250
▸CSSF initial authorization fee: self-managed UCITS / internally managed UCI (single or multiple) — €17,500

CSSF Lump Sum Fee	Amount
Initial authorization — single compartment UCI	€4,650
Initial authorization — multiple compartment UCI	€9,250
Initial authorization — self-managed UCITS / internally managed UCI	€17,500
New compartment added to existing umbrella	€1,100
ELTIF compartment in certain AIF set-ups	€1,100

Amortization Under Lux GAAP

Luxembourg GAAP permits formation expenses to be amortized over up to 5 years. This means a fund does not need to expense all set-up costs in Year 1 — they can be spread over the early life of the fund. The amortization policy must be disclosed in the fund accounts. Funds that are wound up before the amortization period ends must write off the remaining balance immediately.