Europe · Tax guide
Luxembourg
Luxembourg taxes company profits at 16% before surcharges and municipal business tax — about 23.9% in Luxembourg City in total — levies a net wealth tax on companies, charges VAT at 17%, the lowest standard rate in the EU, and applies the global minimum tax. Direct taxes are administered by the ACD and VAT by the AED.
At a glance
- Corporate income tax
- 16%
- Net wealth tax
- 0.5%
- VAT
- 17%
- Dividend withholding
- 15%
- Property duties
- about 7%
- Global minimum tax
- 15%
about 23.9% in Luxembourg City with surcharge and municipal business tax
On companies' net assets
Reduced rates 14%, 8% and 3%
Before exemptions and treaties
Registration and transcription
Groups with revenue of €750 million or more
Corporate taxes
Companies pay corporate income tax (IRC) at 16%, plus a solidarity surcharge and the municipal business tax, for about 23.9% in Luxembourg City. Companies also pay an annual net wealth tax of 0.5% on their net assets, with lower rates on very large bases and a minimum charge.
VAT
VAT is charged at 17%, with reduced rates of 14%, 8% and 3%. Small businesses with turnover up to €50,000 can be exempt. Returns are monthly, quarterly or annual depending on turnover.
Withholding tax
Dividends carry 15% withholding tax, removed under the participation exemption for qualifying parent companies and often reduced by treaty. Interest and royalties paid to non-residents are generally not subject to withholding tax.
Transfer pricing and the global minimum tax
Related-party transactions must be at arm's length, with documentation available on request. Groups with revenue of €750 million or more are subject to the global minimum tax at 15%.
Property
Buyers pay registration and transcription duties of about 7% of the price, with relief for a first home.
Key dates
- Monthly, quarterly or annuallyVAT returns, depending on turnover
- QuarterlyAdvance payments of corporate income tax and municipal business tax
- By 31 December of the following yearAnnual corporate tax returns
Figures and sources
10 figures- Corporate income tax (IRC) rate16%Checked against the official source
- Combined corporate income tax, solidarity surcharge and municipal business taxabout 23.9% in Luxembourg CityChecked against the official source
- VAT standard rate17%Checked against the official source
- Net wealth tax on companies (on net assets up to €500 million)0.5%Under professional review
- VAT reduced rates14%, 8% and 3%Checked against the official source
- Withholding tax on dividends (before treaty or participation exemption)15%Under professional review
- Registration and transcription duties on property purchasesabout 7%Under professional review
- Global minimum tax rate15%Under professional review
- Group revenue for the global minimum tax€750 millionUnder professional review
- Turnover limit for the small business VAT exemption€50,000Under professional review
Indicative only. This assessment is a high-level overview of tax obligations in Luxembourg based on the information you provided and rules in force for 2026. It is not tax or legal advice. Consult a Luxembourg tax adviser before making compliance decisions.