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Generic Tax Name Personal income tax - Withholding tax on income from capital
Tax name in the national language Retenue d'impôt sur les revenus de capitaux (Special method of collection of personal income tax)
Tax name in English Withholding tax on income from capital
Member State LU-Luxembourg
Tax in force since 1967/12/04
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

Law of 4 December 1967 on income tax, Title I, Articles 146-151 (Mémorial A, 1967, pp. 1271-1273), as amended by successive laws and implementing regulations, the most recent of which are:

Law of 22 December 1993 designed to revive investment in the interests of economic development (Mémorial A, 1993, p. 2020);

Law of 23 December 1997 (Mémorial A, 1997, p. 3330);

Law of 21 December 2001 (Mémorial A, 2001, p. 3312);

Budget Law of 20 December 2002 (Mémorial A, 2002, p. 3235);

Law of 15 June 2004 (Mémorial A, 2004, p. 1568);

Law of 21 June 2005 (Mémorial A, 2005, p. 1547);

Budget Law of 22 December 2006 (Mémorial A, 2006, p. 4315).

 
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
Domestic-source income of non-residents is Taxed
Not Taxed
Comments

Employment incomes of married couples are Taxed jointly
Taxed separately
Comments


Comments

Individuals who receive dividends from a Luxemburg-based corporation (debtor).

 
Tax object and basis of assessment
As general rule, taxable income under personal income tax includes























Comments

Income considered Domestic income
Worldwide income (subject to double-tax relief)
Comments

Benefits in kind
The following benefits in kind are usually (partially or fully) taxable












Comments


Comments

Income (dividends).

 

Basis of assessment:

  • Dividends, profit shares and other proceeds allocated by joint-stock companies.
  • Profit shares which a fund provider, paid in proportion to the profits, receives from his investment in a company.
 
Deductions, Allowances, Credits, Exemptions
Deduction for professional expenses.
The deduction is:





Comments

Deductions from the tax base
The following items are usually (partially or fully) deductible

















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
There are tax credits for:

















Comments

Losses
Losses can be
Carried-forward for Indefinite
 Years
Carried-back for Indefinite
 Years
Transferred to spouse or partner
Comments

Exemptions
The following income is exempted from income tax























Comments


Comments

Dividends are subject to a withholding tax of 15% unless if distributed to a corporate shareholder meeting under certain conditions (concerning notably a minimum size of the participation and a minimum of holding period) or unless induced under any relevant tax treaty.

 
Rate(s) Structure
The following personal income tax rates apply to aggregate annual income (allowances not included)
Bracket 1 From   EUR/Natcur
To   EUR/Natcur
Rate: 15.00 %
Comments

Regional taxes
Regional taxes are (rate in capital region) A lump-sum amount:
A percentage of income:
A tax surcharge:
Comments

Local/municipal taxes
Local taxes are (rate in capital city) A lump-sum amount:
A percentage of income:
A tax surcharge:
Comments

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

Separate taxation
Separate taxation applies to the following items: Employment income
Income from business or self-employed activities
Income from sport and entertainment activities
Benefits in kind (company car, meal cheques, etc)
Pension income
Owner-occupied immovable property
Dividends
Interests from government bonds
Interests from corporate bonds
Interests from special saving accounts
Interests from deposits
Royalties
Income from renting immovable property
Income from renting movable property
Capital gains on immovable property
Capital gains on movable property
Inheritance
Annuities from life insurance
Prizes and awards
Scholarships
Income from occasional activities
Revenues from donations and gifts
Revenues from lotteries and games activities
Comments

Withholding taxes
The tax is withheld when paid to residents on: Dividends:
Final Creditable
Interests from governments bonds:
Final Creditable
Interests from corporate bonds:
Final Creditable
Interests from special saving accounts:
Final Creditable
Interests from deposits:
Final Creditable
Comments


Comments

15 % of gross dividends (or 17.65% if the debtor pays the tax).

 
Tax due date

Tax is withheld by the company at the moment of payment of the dividends.

 
Tax collector

Administration of direct taxes (Administration des contributions directes).

 
Special features

 
Economic function







Comments
 
Environmental taxes



Comments
 
Tax revenue
ESA95 code d51m (d51ae)

Year
Annual tax revenue (millions)
Currency
Tax revenue as % of GDP
Tax revenue as % of total tax revenue
2012 315.00 EUR 0.72
2011 271.00 EUR 0.64
2010 315.00 EUR 0.80
2009 271.00 EUR 0.75
2008 280.00 EUR 0.74
2007 188.00 EUR 0.51
2006 363.50 EUR 1.09
2005 221.30 EUR 0.74
2004 123.00 EUR 0.45
2003 141.90 EUR 0.55
2002 104.10 EUR 0.42
2001 88.00 EUR 0.37
2000 88.10 EUR 0.38

Comments