Tax return in Luxembourg: who must file, and who should

Filing becomes mandatory for a resident when any of these applies: taxable income above €100,000 a year, even with a single withholding card; several concurrent salaries or pensions (two employers, or salary plus pension) once taxable income exceeds €36,000 in tax classes 1 and 2, or €30,000 in class 1a; more than €600 a year of net income not subject to withholding — rental income, freelance side income, foreign income; or more than €1,500 of Luxembourg investment income subject to withholding (dividends, directors' fees).

Non-residents face broadly the same triggers on their Luxembourg income: the €100,000 threshold, the multi-card thresholds, or any Luxembourg income that escaped withholding — a rental property in the country, for instance. Self-employed workers generally file too, once their income exceeds the taxable threshold, as does anyone who opted for individual taxation or cross-border assimilation. If you have just set up a company in Luxembourg, expect a personal filing obligation alongside the corporate one.

Two documents get confused constantly. Form 100 is the full tax return — every income category, every deduction, and a final assessment that can go either way. Form 163, the "annual statement", is not a return at all: it simply regularises the withholding on salaries and pensions for people neither required nor otherwise eligible to file. It is the right tool for an incomplete year — first job, graduation, mid-year arrival or departure — or highly variable monthly pay; it results in a refund of excess withholding, and additional tax is in principle not collected through it.

One catch for non-residents: the annual statement is only open after 9 continuous months of salaried work in Luxembourg during the tax year, or if at least 75% of your gross annual salary comes from Luxembourg. The decision rule is simple: if any mandatory-filing trigger applies to you, it is Form 100; otherwise Form 163 is a free option that can only work in your favour.

Since the 2022 tax year, Luxembourg applies a single, generous deadline: the return on 2025 income can be filed until December 31, 2026 — the old March 31 date no longer exists. The 2026 campaign opened on April 7, when the forms and the MyGuichet electronic assistant went live for the 2025 tax year.

Three ways to file: the MyGuichet.lu electronic assistant — guided step by step, available in English, with a tax pre-calculation and faster automated processing (a LuxTrust product or Luxembourg eID is required), though it excludes a few situations, notably a change of country of residence during the year; the official PDF of Form 100 submitted through MyGuichet; or plain paper to your tax office — electronic filing is not mandatory for individuals. Note for expats: the official PDF forms exist in French and German only (the ACD publishes an English translation for information purposes), which is where an English-speaking fiduciaire typically steps in — for instance in an arrival or departure year, when the assistant cannot be used.

Filing late exposes you to a surcharge of up to 10% of the tax due, penalty payments, and ultimately an ex-officio assessment on estimated — rarely favourable — figures.

Your withholding and final tax depend first on your tax class: class 1 for single taxpayers, class 1a for single parents, widowed persons and taxpayers over 64 at the start of the year, class 2 for jointly-taxed married couples — with income splitting, a substantial advantage when spouses earn unequal amounts. Since 2018, married non-residents default to class 1 unless they opt in.

That opt-in is tax assimilation (article 157ter): a non-resident whose household income is essentially Luxembourg-taxed (90% of worldwide income, or non-Luxembourg income below €13,000 — Belgian residents have an alternative 50% test) can elect to be treated as a resident, unlocking class 2, splitting and the full deduction catalogue. It requires filing a return, and the arithmetic deserves care: a spouse's home-country income can tip the balance either way. Our French-language cross-border tax guide covers the traps in depth.

Refunds come from deductions the monthly withholding ignores. The most used: pension savings (article 111bis) — €3,200 deductible per subscriber for 2025 income, and raised to €4,500 from 2026 income; insurance premiums and debit interest — €672 per household member per year; home-savings plans — €672, doubled to €1,344 when the subscriber is 18 to 40; mortgage interest on the main home (fully deductible the year of moving in and the next, then €4,000 / €3,000 / €2,000 per person as the years pass); charitable donations of €120 or more a year; and domestic help or childcare up to €5,400 a year.

The commuting-expense deduction (up to €2,574 a year) and the €540 professional-expense minimum are applied automatically. Tax credits — up to €600 for employees (phased out between €40,000 and €80,000 of gross pay, nil above), up to €3,504 for single parents, and the CO2 credit (€192 for 2025, €216 from 2026) — are usually settled through payroll, but a return catches anything missed. Typical refund cases: an incomplete year, unclaimed deductions, or a cross-border worker switching to assimilation — a first optimised return frequently recovers several hundred euros.

For a standard employee or cross-border filing, fiduciaires typically charge a few hundred euros — often less than the refund a first optimised return produces. Situations that genuinely warrant help: income in two countries, stock options, rental property, an arrival or departure year, or the choice between individual and joint taxation. Of the 555 OEC-certified firms in our directory, around 295 work in English — see our guide to choosing an accountant in Luxembourg for how to vet them.