How should I use the funds in my home savings contract when it comes to maturity?
The funds in your home savings contract must be used for one of the following purposes in order to qualify for tax deductions:
The construction, acquisition, maintenance, repair or conversion of a flat or house that you personally use as your principal residence;
The acquisition of land to build a flat or house for your own personal use;
The financing of a photovoltaic or thermal solar installation integrated into a flat or house used as your own home;
Repayment of loans or bonds taken out for the purposes mentioned in points 1 to 3.
These provisions apply both to properties located in the Grand Duchy of Luxembourg and to those located abroad.
Please note: failure to use the funds for tax-efficient purposes will result in the loss of tax deductions.
Non-allocation occurs when you use the funds received on maturity of the home savings contract for purposes other than those described above.
For example, using these funds to buy a car, furniture, or the construction or acquisition, in whole or in part, of a property for professional or rental use does not constitute an allocation that complies with the tax conditions.
Similarly, a non-allocation is when you return the funds borrowed from the home savings scheme because the initial property project cannot be completed in the end. In such cases, you lose the right to benefit from tax deductions relating to the home savings contract in the future.
The construction, acquisition, maintenance, repair or conversion of a flat or house that you personally use as your principal residence;
The acquisition of land to build a flat or house for your own personal use;
The financing of a photovoltaic or thermal solar installation integrated into a flat or house used as your own home;
Repayment of loans or bonds taken out for the purposes mentioned in points 1 to 3.
These provisions apply both to properties located in the Grand Duchy of Luxembourg and to those located abroad.
Please note: failure to use the funds for tax-efficient purposes will result in the loss of tax deductions.
Non-allocation occurs when you use the funds received on maturity of the home savings contract for purposes other than those described above.
For example, using these funds to buy a car, furniture, or the construction or acquisition, in whole or in part, of a property for professional or rental use does not constitute an allocation that complies with the tax conditions.
Similarly, a non-allocation is when you return the funds borrowed from the home savings scheme because the initial property project cannot be completed in the end. In such cases, you lose the right to benefit from tax deductions relating to the home savings contract in the future.
Updated on: 05/06/2025
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