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Luxembourg Income Tax

Individual income tax is levied on the worldwide income of individuals residing in Luxembourg, as well as on Luxembourg-source income of non-residents.

Luxembourg income tax liability is based on the individual’s personal situation (e.g. family status). For this purpose, individuals are granted a tax class. Three tax classes have been defined – Class 1 for single persons, Class 2 for married persons as well as civil partners (under certain conditions) and Class 1a for single persons with children as well as single taxpayers aged at least 65 on 1 January of the tax year.

Married non-resident taxpayers who are not separated are granted tax class 2, if they are taxable in Luxembourg on more than 50% of the professional income of their household. In such a case where both spouses derive professional income taxable in Luxembourg, the application of tax class 2 leads to a combined assessment. However, unseparated married non-resident taxpayers who do not comply with the above 50% condition are granted the tax class 1 or 1a.

Non-resident civil partners may a benefit from tax class 2 under certain conditions as well.

Tax is calculated in accordance with a progressive table, ranging from 8% on taxable income in excess of 11,265 euros (EUR) to 40% on income in excess of EUR 100,000 for 2016 and a solidarity tax of 7% of taxes (9% for taxpayers earning more than EUR 150,000 in tax class 1 and 1a or more than EUR 300,000 in tax class 2) must be paid as well.

Tax Changes in 2017

Tax Reform had passed in Luxembourg for 2017. New law brought some proposed changes of adding two more categories of taxable income brackets as below:

Taxable income in Brackets Tax rate
150,000€ – 200,004€ 41%
200,004€ + 42%

Source

Calculate your net income:

Please note, that this calculation took into a consideration just a very basic pieces of information of yours and the result might vary significantly. Contact us for detailed and precise calculation or let us know by filling a form and will call you back. Contact us for an exact calculation.

Single taxpayer (Class 1/Class 1a)

Taxable salaried income (EUR) Income tax (including solidarity tax) (EUR)
Class 1 Class 1a
20,000 1,087 0
38,700 6,279 4,946
58,000 14,275 13,207
77,400 22,371 21,510
96,700 30,425 29,770
116,000 38,650 38,031
135,500 46,996 46,377
155,000 55,382 54,763

Married taxpayer (Class 2)

Taxable salaried income (EUR) Income tax (including solidarity tax) (EUR)
Class 2
20,000 0
38,700 1,951
58,000 6,192
77,400 12,560
96,700 20,497
116,000 28,551
135,500 36,689
155,000 44,826

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Contracting in Luxembourg
Contracting in Luxembourg
 Capital  Grand Duchy of Luxembourg
 Population  0.56 million
 Language  Luxembourgish (Lëtzebuergesch)
 Currency  1 Euro (EUR) = 100 cents
 Government  Constitutional Monarchy under a system of Parliamentary Democracy