Publié le 07 March 2025

Luxembourg taxes 2024: Key changes for residents and cross-border workers

Luxembourg tax changes 2024: updated rates, new deduction limits, form updates, capital gains adjustments, and mandatory TIN for cross-border workers.

1. Updated tax scale brackets

Luxembourg's tax rate brackets have been adjusted for the 2024 tax year. These updates reflect economic developments, including inflation and new budgetary priorities.

2. Deductible interest limits for primary residences

Starting in 2024, the availability date of a primary residence will determine the maximum deductible mortgage interest, replacing the previous rule based on the occupancy date.

Here are the new deduction limits based on when the property became available:

After 31/12/2022: Full deduction of mortgage interest.
Between 31/12/2018 and 01/01/2023: Deduction capped at €4,000 per person.
Between 31/12/2013 and 01/01/2019: Deduction capped at €3,000 per person.
Before 01/01/2014: Deduction capped at €2,000 per person.

These limits apply per household member (spouse and children).

Example:
A family of four (two parents and two children) with a home available in 2020 can deduct up to €16,000 in mortgage interest (€4,000 per person).

3. Rental income: Merged forms (190 and 210), depreciation updates, and tax exemptions for social housing

From 2024, Forms 190 and 210 have been merged into a single document, with Form 190 undergoing a complete revision.

Additionally, real estate depreciation rates have been updated to align with different property types.

A 90% tax exemption now applies to rental income from social housing management, up from 75% in 2023.

4. Form 700 - Capital gains: Transfer mechanism, revaluation coefficients, and quarter of the global tax rate

Revaluation coefficients for capital gains on real estate have been updated to reflect inflation and economic conditions, adjusting the original purchase price accordingly.

From 2024, capital gains tax deferral is possible under strict conditions when reinvesting in a replacement property.

Additionally, capital gains tax is now calculated at a quarter of the global tax rate, instead of the previous half-rate applied in 2023.

5. Mandatory tax identification number (TIN) for cross-border workers

As of 2024, all cross-border workers (tax residents outside Luxembourg who work in the country) must provide their TIN (Tax Identification Number) when filing their Luxembourg tax return.

6. New tax credits - overtime and tax bracket

Eligible taxpayers can now request a new tax credit for overtime work and a tax bracket credit. These tax benefits aim to reduce the overall tax burden based on income and individual circumstances.