This is the one check whose omission can cost you money directly — not because a partner fails to pay you, but because of what they fail to pay the state.
What it is
The Luxembourg tax administration maintains a public register of unreliable VAT payers — businesses that have seriously breached their tax obligations. It is public and updated continuously.
What matters is the consequence for you: if you receive a taxable supply from an unreliable payer, you become liable for the VAT they fail to remit on it. The tax office can come to you for it. You end up paying that VAT twice — once to the supplier inside the invoice, and again to the state under the guarantee.
When to check
What counts is the status at the moment the taxable supply takes place, not when you first vetted the supplier. A company can be listed at any time.
So: before the first payment to a new supplier, and periodically for a regular one. For large supplies, before every payment — the lookup takes seconds.
What to do if a supplier is listed
The simplest defence is the special method of securing the tax: pay the VAT portion of the invoice directly to the tax office's account and remit only the net amount to the supplier. That extinguishes the liability. It is a procedure the law provides for, not a workaround.
One related trap: pay to a published bank account. Paying to an account the supplier has not notified to the tax administration creates the same liability on its own, whether or not they are listed as unreliable.
Why this article exists
Most foreign company-checking tools do not have this check, because no equivalent exists in their country. In Luxembourg it is the most concrete financial risk you can read straight out of public data.