What is the tax impact of marriage in Luxembourg?
What is the tax impact of marriage in Luxembourg?
For married couples, the situation is not exactly the same, depending on whether you are a resident of Luxembourg or a non-resident. There is a difference in terms of the withholding tax levied on your monthly salaries:
On your monthly salary slips, one spouse will be taxed at tax class 2 and the other at the flat rate of 15%.
When you prepare your tax return, tax class 2 will be applied to all household income.
On your monthly payslips, a fixed rate of tax will be allocated to both spouses.
When your tax return is drawn up, tax class 2 will be applied to all household income.
The benefit of tax class 2, reduces the overall tax rate on their combined income.
Double the maximum amount deductible for certain expenses (e.g. insurance, interest on personal loans, etc.).
Possibility of an allowance known as the "extra-professional allowance" for both partners in employment.
For married couples, the situation is not exactly the same, depending on whether you are a resident of Luxembourg or a non-resident. There is a difference in terms of the withholding tax levied on your monthly salaries:
Residents
On your monthly salary slips, one spouse will be taxed at tax class 2 and the other at the flat rate of 15%.
When you prepare your tax return, tax class 2 will be applied to all household income.
Non-residents
On your monthly payslips, a fixed rate of tax will be allocated to both spouses.
When your tax return is drawn up, tax class 2 will be applied to all household income.
Residents and non-residents: what are the advantages of collective taxation?
The benefit of tax class 2, reduces the overall tax rate on their combined income.
Double the maximum amount deductible for certain expenses (e.g. insurance, interest on personal loans, etc.).
Possibility of an allowance known as the "extra-professional allowance" for both partners in employment.
Updated on: 20/02/2024
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