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Generic Tax Name Social security contribution (Self- and Non-employed)
Tax name in the national language Contributions sociales
Tax name in English Social security contributions - Self- and Non-employed
Member State LU-Luxembourg
Tax in force since 2011/01/01
If abolished, date on which the tax ceases to apply
Business version date 2015/01/01
Version date 2015/02/17
This file was last updated on

Type of tax
Direct taxes Personal income tax
Corporate income tax
Other

Indirect taxes VAT
Excise duty (EU harmonised)
Alcoholic beverages
Energy products and electricity
Manufactured tobacco
Other

Social security contribution Employers
Employees
Other
 
Legal base

Health care, paid sick leave (Assurance maladie-maternité) and mutual insurance of the employers (mutualité des employeurs):

 

Financing: The scheme is financed by central government, employers and employees contributions. Regarding health care provisions in kind, a contribution of about 5% of gross wages is paid commonly by employers and employees. The central government participates with 37% of total contributions paid on salaries. Regarding replacement benefits in case of paid sick leave, a contribution of about 5% of gross wages is paid commonly by employers and employees for blue collar workers and about 0.2% for white collar workers. The central government participates with 10% of total contributions paid on salaries. Maternity benefits (in kind and in cash) are on charge of the central government. From 2011 onwards, the central government provides 40% of the total contribution paid on salaries. 

Until 2009, the continuation of remuneration in the event of disability over the first 15 weeks of sickness leave of white collar workers was at charge of the employer, estimated at about 1.3% of salaries in 2008. On the other hand, the health care and paid sick leave insurance covered the entirety of the sickness leave allowance of blue collar workers as of the first day of sickness leave. Of this fact two contribution rates were applicable until 2009: the employers' contribution rate applicable in 2008 was 2.35% for blue collar workers and 0.10% for white collar workers and identical shares were applicable for employees. On average an estimated global contribution rate applicable for employers in case of sickness leave insurance was about 0.8% in the year 2008. From 2009 onwards, the legislation on the single statute introduces the single statute of employee, gathering blue and white collar workers, and aligning the conditions of the financing the sickness leave. The employers' obligations cover from now on the first 13 weeks of disability for all the employees, and the employers are refunded to 80% by a mutual insurance company of the employers (contribution rate in 2009 close to 1.8%). Self-employed can opt to participate in the mutual insurance company. From the 14th week onwards, the allowances are at the charge of the sickness and maternity insurance (in 2009: employers' share of 0.25%, identical shares for employees). So due the introduction of the single statute, the share passes from 0.10% to 0.25% for the employers and employees of former statute “white collar” and from 2.35% to 0.25% for the employers and employees of former statute “blue collar”. Self-employed have to support employers and employees contribution rate.

 

Legal basis: Livre I du Code des Assurances Sociales : Assurance maladie

Web references: http://www.secu.lu/assurance-maladie/livre-i/

Web reference for applicable contribution rates:

http://www.ccss.lu/cotisations/parametres-sociaux/

 

Pension scheme (Assurance pension):

Financing: The scheme is financed by central government, employers and employees contributions. A contribution of 16% of gross wages is paid commonly by employers and employees. The central government participates with 8% of total contributions paid on salaries.

Legal basis: Livre III du Code des Assurances Sociales : Assurance pension

Web references: http://www.secu.lu/assurance-pension/

Web reference for applicable contribution rates:

http://www.ccss.lu/cotisations/parametres-sociaux

 

 

Occupational injury (Assurance accidents):

Financing: The scheme is mainly financed by contributions from employers and self employed.

Legal basis: Livre II du Code des Assurances Sociales : Assurance accidents.

Web references: http://www.secu.lu/assurance-accident/

Web reference for applicable contribution rates:

http://www.ccss.lu/cotisations/parametres-sociaux

 

Special pension scheme (Pensions statutaires):

Financing: The scheme is mainly financed by central and local government tax income. Civil servants participate with a contribution of 8% of gross salary.

Legal basis: 1998 : Loi du 3 août 1998 portant modification 1. de la loi modifiée du 26 mai 1954 réglant les pensions des fonctionnaires de l'Etat; 2. de la loi modifiée du 16 avril 1979 fixant le statut général des fonctionnaires de l'Etat; 3. de la loi modifiée du 22 juin 1963 fixant la valeur numérique des traitements des fonctionnaires de l'Etat ainsi que des modalités de mise en vigueur de la loi du 22 juin 1963 fixant le régime des traitements des fonctionnaires de l'Etat; 4. de la loi du 27 juillet 1992 relative a la participation du Grand-Duché de Luxembourg a des opérations pour le maintien de la paix (OMP) dans le cadre d'organisations internationales; 5. de la loi du 27 août 1977 concernant le statut des fonctionnaires entrés au service d'Institutions internationales; 6. de la loi modifiée du 22 juin 1963 fixant le régime des traitements des fonctionnaires de l'Etat; 7. de la loi du 8 janvier 1996 modifiant et complétant a) la loi modifiée du 22 juin 1963 fixant le régime des traitements des fonctionnaires de l'Etat; b) la loi modifiée du 22 juin 1963 fixant la valeur numérique des traitements des fonctionnaires de l'Etat ainsi que des modalités de mise en vigueur de la loi du 22 juin 1963 fixant le régime des traitements des fonctionnaires de l'Etat; c) la loi du 29 juillet 1988 portant modification et nouvelle coordination de la loi modifiée du 26 mai 1954 réglant les pensions des fonctionnaires de l'Etat; d) la loi du 23 décembre 1994 concernant le budget des recettes et des dépenses de l'Etat pour l'exercice 1995 - 1998 : Loi du 3 août 1998 instituant des régimes de pension spéciaux pour les fonctionnaires de l'Etat et des communes ainsi que pour les agents de la Société nationale des Chemins de Fer luxembourgeois.

Web references: http://www.legilux.public.lu/

 

Long term care (assurance dépendance):

Financing: The scheme is financed by a contribution on salaries, replacement revenue and investment income, by a special contribution from electricity tax revenue and 40% of 2013 (35% for 2012) of the scheme total expenses are covered by a contribution from the state budget. From 2007 up to 2011 the particiaption of the central administation was limited to 140 million EUR.

Legal basis 1998 : Loi du 19 juin 1998 portant introduction d'une assurance dépendance - Livre V du Code des Assurances Sociales : Assurance dépendance.

Web references: http://www.secu.lu/assurance-dependance

Web reference for applicable contribution rates:

http://www.ccss.lu/cotisations/parametres-sociaux

 

Unemployment:

Financing : The scheme is financed by a solidarity tax levied on gross personal income (2.5%) and company profits (4%), an excise duty on certain mineral products and direct budgetary allocations from the Ministry of Labour. In 2009 the respective amounts are 119.4 million euros for the solidarity tax, 140 million euros for the duty on mineral oils and 50 million euros corresponding to the direct budgetary allocation.

Legal basis 1996: Loi du 30 juin 1996 portant 1. création d'un fonds pour l'emploi; 2. réglementation de l'octroi des indemnités de chômage complet. The Law was substantially modified by the Law of 31 July 2006 on the Introduction of a Labour code ("Loi du 31 Juillet 2006 portant introduction d'un Code du Travail"). The latter also contains the relevant provisions on unemployment benefits paid to companies which close temporarily due to seasonal or structural problems ("chômage partiel de source conjoncturelle ou structurelle") and on unemployment caused by bad weather or for reasons which are out of the control of the company and its employees ("chômage involontaire dû aux intempéries et chômage accidentel et technique involontaire").

Web references: http://eli.legilux.public.lu/eli/etat/leg/loi/2006/07/31/n2

Web reference for applicable contribution rates:

http://www.impotsdirects.public.lu/az/f/fond_empl/index.html

 
Who sets
The tax rate is set by




The tax base is set by




The reliefs are set by




Comments
 
Beneficiary





Comments
 
Geographical Scope

Grand Duchy of Luxembourg.

 
Taxpayers
The base or rate of social security contributions paid by Employees on the income of employees and of blue collar workers Rates are identical
Bases are identical

Comments

Self-employed individuals pay approximately the same rates as the combined rates for an employer and an employee.

Rate = 25.10%


Domestic-source income of non-residents is Subject to SSCer
Not Subject to SSCer

Comments


Comments
 
Tax object and basis of assessment
Employees pay social security contributions for








Comments

Others = long term care


Base for all contributions listed here above is the same Yes No

As general rule, the income subject to Social Security Contributions of Employees includes























Comments

Net income as defined by Luxembourg income tax law up to a social security ceiling of an estimated amount of EUR 115,261.56 for calendar year 2014.


Income considered Domestic income
Worldwide income
Comments

Benefits in kind

The following benefits in kind are usually (partially or fully) subject to social security contributions paid by Employees












Comments


Comments

Income from self-employment : gross income, for contributions made to the health care scheme, the occupational injury scheme, the pension scheme, the long-term care scheme and the unemployment fund.

(For the non-employed) Contributions are made on the basis of a figure for gross income (only to the health care and pensions regimes for those who make voluntary contributions; those non-employed who make compulsory contributions also contribute to the unemployment fund and the occupational injury scheme).

 
Deductions, Allowances, Credits, Exemptions
Capped contributions No cap
Cap in monetary units: 9614.82  EUR/Natcur
Cap in % of the tax base:

Reduction

The reduction is
No reduction
A lump-sum amount
In percentage of base:
     
Based on salary
Capped
Comments

Allowances
The basic yearly allowance for an individual amounts to:
The basic yearly allowance for a couple amounts to:
Additional allowance for 1st child
Additional allowance for 2nd child
Additional allowance for 3rd child
Additional allowance for additional child
Additional allowance for old age dependents
Comments

Credits
The basic yearly credit for an individual amounts to:
The basic yearly credit for a couple amounts to:
Additional credit for 1st child
Additional credit for 2nd child
Additional credit for 3rd child
Additional credit for additional child
Additional credit for old age dependents

Social Security Contributions paid by Employees are tax deductible Yes No


Comments

Gross income below the minimum wage is exempted from social security contributions. The basis for assessment of social security contributions is capped at 5 times the minimum wage.

For the long term care scheme, an amount equal to 1/4 on the minimum wage is deductible from the basis for assessment and there is no cap on contributions.

 
Rate(s) Structure
The following rates apply to Social Security Contributions paid by Employees
Pensions
16.00 %  From  EUR/Natcur  To  EUR/Natcur

Health care
6.10 %  From  EUR/Natcur  To  EUR/Natcur

Unemployment

Child care

Work-related illnesses and/or accidents
1.10 %  From  EUR/Natcur  To  EUR/Natcur

Education leave

Maternity leave

Others

Comments

Self-employed persons contribute to the social security scheme at a rate of 25.10% (Care insurance included).

Long term care: 1.40%

Impôt d'équilibrage temporaire (IEBT): 0.5%


Special surcharges

There are special surcharges in the form of:
Surcharge 1 : Name:
A lump-sum amount:
A percentage of income:
A tax surcharge:
Comments



Comments

Health care and paid sick leave

until 2009: benefit in cash: 0.2% of gross self-employment income

upon 2009: benefit in cash: 0.5% of gross self-employment income

until 2011: benefit in kind: 5.4%

upon 2011: benefit in kind: 5.6% of gross self-employment income

 

Pension scheme

16% of gross self-employment income

 

Long term care

1.4% of gross self-employment income

occupational injury: 1.15% (2011)

                           1.15% (2012)

                           1.10% (2013)

                           1.10% (2014)

                           1.10% (2015)

On voluntary basis: mutuality of the employers average contribution rate:

                           1.48% (2011)

                           1.42% (2012)

                           1.33% (2013)

                           1.25% (2014)

                           1.32% (2015)

Impôt d'équilibrage budgétaire temporaire (IEBT):

0.5% (2015)

 
Tax due date

Tax is payable monthly.

 
Tax collector

Social security administrations (Centre Commun de la Sécruité Sociale).

 
Special features
 
Economic function







Comments
 
Environmental taxes



Comments
 
Tax revenue
ESA95 code d6113

Year
Annual tax revenue (millions)
Currency
Tax revenue as % of GDP
Tax revenue as % of total tax revenue
2012 607.90 EUR 1.40
2011 563.60 EUR 1.33
2010 506.33 EUR 1.28
2009 523.21 EUR 1.44
2008 478.39 EUR 1.27
2007 454.00 EUR 1.24
2006 411.80 EUR 1.23
2005 398.50 EUR 1.34
2004 438.20 EUR 1.58
2003 345.30 EUR 1.33
2002 312.10 EUR 1.26
2001 298.10 EUR 1.27
2000 275.90 EUR 1.19

Comments