The Luxembourg Administration of Direct Tax has issued Circular L.I.R. n° A 21/1 of 21 October 2021, which updates and replaces Circular L.I.R. n° A 21/1 of 7 April 2021 regarding the tax allowance for rent reductions. The tax allowance was first granted in 2020 for the benefit of owners that reduce commercial rents in order to help businesses impacted by the COVID-19 pandemic and was subsequently extended for 2021 by the Law of 21 June 2021. The allowance is equal to twice the amount of re…