Taxes in Luxembourg are balanced to ensure a combination of high living standards and social responsibility. The tax policy of the state is very effective in covering the main items of expenses, as well as the ability to provide favourable conditions for the development of entrepreneurship and attracting foreign capital to the country.
With non-resident companies, they pay taxes to the treasury only on profits that have been received from economic activities in Luxembourg – excluding foreign income.
This includes income from SARL limited liability companies, SA public limited liability companies, and registered partnerships.
Companies based here pay corporate tax on profits anywhere in the world, while companies based outside Luxembourg pay on profits generated domestically.
Freelancers, sole proprietors, and those with a share in an unincorporated partnership often pay income tax instead of corporate tax.
Foreigners in Luxembourg must pay corporate taxes on any business income that is not subject to personal income tax.
This includes income from SARL limited liability companies, SA public limited liability companies, and registered partnerships.
Companies based here pay corporate tax on profits anywhere in the world, while companies based outside Luxembourg pay on profits generated domestically.
Freelancers, sole proprietors, and those with a share in an unincorporated partnership often pay income tax instead of corporate tax.
Mortgage loans in Luxembourg are very popular. However, it is very difficult for a foreign citizen to obtain a mortgage, it is available for residents of the country and persons with a residence permit.
Mortgage interest rates are quite low, with a fixed rate of about 6% and a floating rate of 4%.
It is paid by companies subject to corporate income tax in Luxembourg, as well as sole proprietors and partnerships that receive operating income.
For individual entrepreneurs and partnerships, there is an income limit of 40,000 euros, below which they are not paid. Reduced to 17,500 euros in cases where corporate income is paid.
The municipal business tax rate in Luxembourg is 8.25% in Esch / Alzette and 9% in Troisvierges.
The combined corporate and utility business tax rate for limited liability companies is 29.25% in Ash / Alzette and 30% in Troisvierges.
The tax is levied on net assets. The rate is 0.5% for assets up to 500 million euros and 0.05% for assets over 500 million euros.
With non-resident companies, they pay taxes to the treasury only on profits that have been received from economic activities in Luxembourg – excluding foreign income.
Corporate income tax
Foreigners in Luxembourg must pay corporate taxes on any business income that is not subject to personal income tax.This includes income from SARL limited liability companies, SA public limited liability companies, and registered partnerships.
Companies based here pay corporate tax on profits anywhere in the world, while companies based outside Luxembourg pay on profits generated domestically.
Freelancers, sole proprietors, and those with a share in an unincorporated partnership often pay income tax instead of corporate tax.
Withholding tax
Concerning Withholding tax is 15% withholding tax is levied on dividends paid by resident companies to other resident companies. An exemption from withholding tax is granted under the same conditions that apply to the participation exemption for corporate income tax purposes. Liquidation payments are not subject to withholding tax. Dividends paid by exempt Luxembourg holding companies and investment funds are exempt from withholding tax.Foreigners in Luxembourg must pay corporate taxes on any business income that is not subject to personal income tax.
This includes income from SARL limited liability companies, SA public limited liability companies, and registered partnerships.
Companies based here pay corporate tax on profits anywhere in the world, while companies based outside Luxembourg pay on profits generated domestically.
Freelancers, sole proprietors, and those with a share in an unincorporated partnership often pay income tax instead of corporate tax.
Property tax
Costs associated with the purchase process:- 7% – real estate tax
- 15% VAT – payable when purchasing a new home
- 7-10% – notary services
- € 3000 – property registration
- € 3000 – loan processing
Mortgage loans in Luxembourg are very popular. However, it is very difficult for a foreign citizen to obtain a mortgage, it is available for residents of the country and persons with a residence permit.
Mortgage interest rates are quite low, with a fixed rate of about 6% and a floating rate of 4%.
Communal business tax
A municipal fee that is supposed to help municipalities finance their expenses.It is paid by companies subject to corporate income tax in Luxembourg, as well as sole proprietors and partnerships that receive operating income.
For individual entrepreneurs and partnerships, there is an income limit of 40,000 euros, below which they are not paid. Reduced to 17,500 euros in cases where corporate income is paid.
The municipal business tax rate in Luxembourg is 8.25% in Esch / Alzette and 9% in Troisvierges.
The combined corporate and utility business tax rate for limited liability companies is 29.25% in Ash / Alzette and 30% in Troisvierges.
Net wealth tax
The fee applies to limited liability companies as well as to limited partnerships if one of the shareholders is the first type of company.The tax is levied on net assets. The rate is 0.5% for assets up to 500 million euros and 0.05% for assets over 500 million euros.
