Do you have to file a tax return in Luxembourg?

Have you just moved to Luxembourg, or have you been a resident there for a short time? Filing a tax return isn’t automatic for all taxpayers, but it may be required, recommended, or beneficial depending on your situation.

In Luxembourg, income tax is generally withheld at the source by your employer. However, this does not necessarily mean that your tax situation is always fully in order. Additional income, foreign income, family status, deductible expenses, or a change in circumstances may make filing a tax return necessary.

With advice from Séverine, a tax expert at Neofisc, here are the key points you need to know to understand whether you must file a tax return in Luxembourg, by when, and what supporting documents are required.

Withholding Tax: Why a Tax Return May Still Be Necessary

Luxembourg applies a withholding tax on wages. In practice, a portion of the tax is withheld each month by the employer before the net wage is paid.

This system simplifies the process for employees, but it does not always take into account the taxpayer’s full tax situation. Withholding tax is based, in particular, on the information listed on the tax withholding form: tax bracket , family status, applicable rate, and any tax allowances.

As Séverine, a tax expert at Neofisc, points out , “withholding tax is always provisional.” It may therefore need to be adjusted if you receive other income, if your family situation changes, or if you wish to claim certain deductible expenses.

To better understand how the tax system in Luxembourg works overall, see our practical guide to taxation in Luxembourg for expatriates and newcomers.

Who is required to file a tax return in Luxembourg?

Contrary to what one might think, filing an annual tax return in Luxembourg is not automatically required for all taxpayers.

However, many residents are required to file a tax return or may wish to do so voluntarily in order to regularize their tax status or request a tax refund.

Situation	Is Filing Mandatory?	Procedure
Employee with a single source of income in Luxembourg	Not always	Check whether a voluntary declaration might be advantageous.
Additional income	Often yes	Report the relevant income according to its type.
Rental income in Luxembourg or abroad	Yes, in many situations	Report real estate income and keep supporting documents.
Foreign income	Depending on the situation	Report it to correctly determine your tax rate.
Deductible expenses or costs	Not always	Filing a tax return may reduce your tax liability or result in a refund.
Request from the Direct Tax Administration	Yes	Comply with the request and the specified deadline.

When is filing a tax return optional but beneficial?

Even when it is not required, filing a tax return can be beneficial. It allows you to claim certain expenses, correct an error, or request a refund of an overpayment.

This applies in particular to taxpayers who have incurred deductible expenses, experienced a change in their family or employment status , received variable income, or gone through a period of unemployment, illness, or parental leave.

Filing a tax return can also be useful for claiming specific expenses such as certain types of insurance, child support, loan interest, childcare costs, or other expenses recognized by the tax authorities.

To identify the relevant expenses, consult our guide to tax deductions in Luxembourg.

What types of income must be reported in Luxembourg?

Your tax return is not limited to the salary you earn in Luxembourg. Depending on your situation, other types of income must be reported so that the tax authorities can correctly calculate your tax liability.

Income Earned in Luxembourg

Income earned in Luxembourg may include, among other things, wages, pensions, self-employment income, rental income, investment income, or taxable capital gains.

If you have multiple sources of income, a specific family situation, or a side job, it is important to verify your reporting obligations.

Income Earned Abroad

Expatriates living in Luxembourg may continue to receive income from their country of origin or another country, such as rental income from real estate, bank interest, dividends, retirement pensions, or other investment income.

This income may need to be reported on the Luxembourg tax return, even if it has already been taxed abroad. As Séverineexplains , “It is included in a notional tax base to calculate an average tax rate.”

The principle is not to tax the same income twice, but to take the taxpayer’s overall situation into account when determining the tax rate applicable to income taxable in Luxembourg.

What supporting documents should you keep for your tax return?

The tax authorities do not always request all supporting documents when you file your tax return. This does not mean they are unnecessary.

You must be able to provide them if asked for additional information, particularly if you are claiming tax deductions or reporting a special circumstance.

Type of document	Examples	Why keep them?
Income	Pay stubs, pensions, rental income, foreign income	To substantiate the amounts reported.
Deductible Expenses	Insurance, retirement savings, loan interest, childcare expenses	Claim the deductions to which you are entitled.
Family status	Marriage, domestic partnership, dependent children, child support	Ensure your tax situation is properly taken into account.
Foreign assets or income	Foreign tax assessments, real estate income, dividends, interest	Avoid inconsistencies or requests for additional information.

“If the tax authorities request documents and you don’t provide them, they won’t take your deductions into account,” Séverine points out. It is therefore recommended that you prepare a complete tax return every year.

What is the deadline for filing your tax return?

In Luxembourg, the income tax return must generally be filed no later than December 31 of the year following the relevant tax year.

For example, the return covering income for year N must be filed by December 31 of year N+1.

This deadline allows time to gather the necessary documents, but you shouldn’t wait until the last few weeks to prepare your return. As Séverine recommends, “We have a year to prepare our return, so let’s fill it out without rushing.”

How do you file your tax return in Luxembourg?

The return can be filed using the designated form—specifically Form 100 for individuals—or online via MyGuichet.lu when the taxpayer’s circumstances allow.

Filing online allows you to complete the return with step-by-step guidance and submit the documents to the tax authorities. However, certain special circumstances may require the use of a paper form or assistance from a professional.

To understand the steps involved in filing your return, see our practical guide to filing income tax returns in Luxembourg.

What are the consequences of an oversight or delay?

Failure to comply with tax obligations may result in late payment interest, financial penalties, or additional requests from the tax authorities.

Failure to pay taxes by the due date may result in late payment interest. If the tax authorities send you a request or set quarterly estimated tax payments, it is important to respond by the deadline.

“You should always comply with requests from the tax authorities, even if you plan to contest them: pay first, then contest,” advises Séverine. This cautious approach helps prevent a dispute from escalating or additional fees from being imposed.

Tax guides to consult based on your situation

• Would you like to understand how the tax system in Luxembourg generally works?
• Do you need to file your tax return?
• Do you want to understand withholding tax and your tax form?
• Do you want to know about the main tax deductions available?
• Would you like to better understand personal income taxes in Luxembourg?
• Do you want to know the tax implications of marriage or a civil partnership?

Find more information on the Guichet.lu website about personal income tax.

FAQ: Filing a Tax Return in Luxembourg