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8.1.2. Other Taxes

The following table provides an overview of other taxes that may be imposed on a company doing business in the country.

Tax Type Rate(s) Notes
Capital Duty NIL There is no capital duty in Luxembourg.
Payroll Tax NIL There is no payroll tax separately due by companies on their total payroll expenditure. Employers are required to withhold income tax and social security premiums on behalf of their employees under the PAYE system.
Social Security Employer Contribution 12.465% to 15.295% Employer contributions range from 12.465% to 15.295% of employees gross salary and include contributions for pension at 8%, health insurance at 3.05% (2.8% for non-periodic remuneration and benefits-in-kind), accident insurance in the range of 0.675% to 1.125% effective 1 January 2020 (previously 0.72% to 1.2%), mutual health insurance in the range of 0.72% to 2.84% effective 1 January 2023 (previously 0.60% to 2.98%), and 0.14% effective 1 January 2021 (previously 0.11%) for health at work. Effective 1 January 2023, the standard monthly maximum and minimum limits for the social security contribution are EUR 11,936.98 and EUR 2,387.40, respectively (previously EUR 11,566.88 and EUR 2,313.38).
Social Security Employee Contribution 12.45% Employee contributions are approximately 12.45% of their gross salary and include contributions for pension at 8%, health insurance at 3.05% (2.8% for non-periodic remunerations and benefits-in-kind) and, dependency insurance at 1.4% of their gross income as reduced by EUR 564.28 per month effective 1 October 2021 (previously EUR 550.48 per month). Contributions are withheld and paid by the employer. Effective 1 January 2023, the standard monthly maximum and minimum social security contributions are EUR 11,936.98 and EUR 2,387.40, respectively (previously EUR 11,566.88 and EUR 2,313.38).
Property Tax 0.7% to 1% The annual property tax is levied at the municipal level at the rate of 0.7% to 1% on the unitary value of the property (which represents its estimated value in 1941). This is multiplied by coefficients ranging from 100% to 4,000% for the tax year 2023, which are set by each municipality and vary by type of property.
Transfer Tax 7%, 10% Sale or purchase of immovable property situated in Luxembourg is subject to a registration duty of 7% of the market value of the real estate. For non-residential properties located in Luxembourg City, the rate is 10%.
Stamp Duty NIL There is no stamp duty in Luxembourg.
Excise Taxes Various Excise taxes are imposed on mineral oils, alcoholic beverages, tobacco products, sugar, and electricity. Effective 1 January 2021, a CO2 tax is levied at varying rates as an additional excise tax on different fuels, natural gas, etc.
Customs Duty Various Customs duties are imposed on certain goods imported from outside the European Union.
Net Wealth Tax (NWT) 0.05% to 0.5% Resident companies and branches of non-resident companies in Luxembourg are subject to Net Wealth Tax (NWT) on their net wealth, based on prescribed valuation methods. The rates for NWT are as follows: • On the taxable base of up to EUR 500 million - 0.5%; and • On the taxable base exceeding EUR 500 million - EUR 2.5 million, plus 0.05% above EUR 500 million. A reduction of the net worth tax liability is possible by making an allocation to a special reserve before the closing of the tax year following the year for which the net worth tax reduction is claimed. However, a minimum NWT charge applies for all corporate entities having their statutory seat or central administration in Luxembourg. The fixed minimum NWT is EUR 4,815 for specific resident investment vehicles if financial assets exceed 90% of the total gross assets in a given year, and such assets exceed EUR 350,000. Other companies are subject to a minimum NWT charge ranging from EUR 535 to EUR 32,100, depending on the company’s total gross assets.
Insurance Tax 3% to 6% The insurance tax rate varies between 3% and 6%, depending on the nature of the insurance policies concerned. Life insurance premiums are tax-exempt.
Registration Tax 3.40% The total registration taxes on capital contributions of real estate assets to a civil or commercial company is 3.4% (increased from 1.1% effective 1 January 2021). However, the rate is 4.6% (increased from 1.4% effective 1 January 2021) applies for real estate in Luxembourg City.
Real Estate Levy 20% Effective 1 January 2021, a non-deductible real estate levy applies at the rate of 20% on all rental (excluding VAT) and capital gains income from real estate situated in Luxembourg held directly or indirectly by investment vehicles, including specialized investment funds (SIFs), reserved alternative investment funds (RAIFs), and undertakings for collective investment (UCI) part II funds, subject to certain conditions. Depending on direct or indirect ownership, the following income will be considered for levy: income from the rental of real estate in Luxembourg; capital gains from the alienation of real estate (immovable property) in Luxembourg; income from the alienation of shares deriving value from immovable property in Luxembourg considering the share price in proportion to the value of the property. See Sec. 13.3. for the due dates of filing the real estate levy declaration.