LUXEMBOURG
CORPORATE SERVICES
PERSONAL TAX AND SALARY SERVICES
Luxembourg tax law allows certain tax deductions for investments and costs incurred
during a fiscal year (1 January to 31 December) that can significantly reduce your
tax liability or result in a salary tax reimbursement. To claim the maximum deductions
you must have actually paid these amounts on or before 30 December of the tax year.
If
you have a taxable income above €100,000 (single) and €36,000 (both working) for
the year you should have handed in your 2011 tax return by 31 March 2012. The amount
of tax reimbursement resulting from your tax-deductible investments and costs will
naturally depend on your tax class (single, married and number of children) and your
annual declared income. The maximum reimbursement that could result from investing
in these products is in the region of 40%.
ALLOWABLE DEDUCTIONS FROM LUXEMBOURG TAXABLE INCOME
We will we complete your tax return for you and at the same time ensure that you get the most out of your allowable deductions, so contact us and we can help you to complete your tax return.
MORE INFORMATION ON THE TAX-DEDUCTIBLE INVESTMENTS AND EXPENSES
SAVINGS LIFE INSURANCE
You can deduct the premiums you pay for medical, any third party liability (RC personal and car but not comprehensive insurance) and life insurance policies. Lump sum pay-outs, on maturity, from life insurance policies are tax-free.
PENSION POLICY
You can deduct the premiums of between €1,500 and €3,200 (according to your age) that you pay into a Luxembourg supplementary pension policy for a period of at least 10 years and receive an annuity at the of 65 that will be taxed. If you employer offers a complementary pension scheme you can contribute another €1,200 per annum into this scheme, which is also tax deductible. Pay-outs from complimentary pension schemes are tax-free.
COMPANY COMPLIMENTARY PENSION
If you make personal contributions to an employer pension plan, you can deduct your personal contributions up to a maximum annual amount of EUR 1,200
INTEREST PAID ON PERSONAL LOANS
You can deduct the interest you pay on a credit card, overdraft on a current account or personal loan you take out with a bank or a relative, on buying a car, going on holiday, buying furniture for your house, gambling in the casino or paying your back taxes.
INTEREST PAID ON MORTGAGE LOANS
You can deduct the interest you pay on a loan you take out to buy your home (not a holiday home).
CHILD MINDER/CRÈCHE/CLEANER
You can deduct the costs of a child minder. If it is a recognised crèche you need
to supply the invoices you received and paid. If you employ a person at home to
mind the children or clean the house the person must be registered with the Luxembourg
social security.
There have been some exciting changes in our Personal Tax department which you can read about in one of our News items. Meanwhile, any contact link from this page will bring you to a new contact page and directly to Fiduciaire Jean-Marc Faber’s office where our expanded team of personal tax experts is waiting to help you.