Luxembourg – Property Taxes

• Property tax in Luxembourg is known as “taxe foncière” and is based on the value of the property.
• The tax rate varies depending on the commune (municipality) in which the property is located, with rates generally ranging from 0.30% to 1.20% of the property’s value.

Capital Gains Tax (CGT)

• CGT is imposed on the sale of property in Luxembourg, and the rate is 20%.
• CGT is calculated on the difference between the acquisition price and the selling price, after deducting the expenses related to the sale.
• If the property was held for more than six years, the rate of CGT is reduced to 12.5%.

Inheritance Tax

• Inheritance tax in Luxembourg is based on the value of the property and the relationship between the deceased and the heir.
• The tax rate can vary from 0% to 40%, depending on the circumstances.

Gift Tax

• Gift tax in Luxembourg is based on the value of the property and the relationship between the giver and the receiver.
• The tax rate can vary from 0% to 40%, depending on the circumstances.

Tax on Property Income

• Income earned from renting out property in Luxembourg is subject to income tax.
• The tax rate can vary depending on the type of property and the income earned.

Tax Advantages

• There are tax advantages for certain types of property purchases in Luxembourg, such as for first-time buyers or for properties used for professional activities.
• Additionally, properties in certain designated areas may also be eligible for tax incentives.
• Furthermore, Luxembourg has a system of tax allowances which can be used to reduce the overall amount of taxes due on a property.