Your First Luxembourg Tax Return: The Expat Guide (2026)

Luxembourg taxes most salaries at source, so plenty of newcomers assume the paperwork ends with their payslip. Often it doesn't, and often it shouldn't, because a voluntary filing is one of the few pieces of Luxembourg bureaucracy that can pay you money back.

Must you file, or should you file?

You are generally obliged to file a tax return (déclaration, form 100) if, among other cases, your taxable income exceeds €100,000, or you combine several salaries or pensions subject to withholding and your taxable income tops €36,000 (classes 1 and 2) or €30,000 (class 1a). Other triggers include significant income not taxed at source: rental income, foreign income, investment income above certain thresholds.

If none of that applies, you can still file voluntarily, either a full return or the lighter décompte annuel (annual adjustment, form 163). The point of both: the monthly withholding tables assume a smooth, full-year salary. Arrive in March, get a bonus, change jobs, or have deductible expenses, and you have probably overpaid. The tax office refunds the difference; it does not send it automatically.

Tax classes, quickly

Married residents are jointly taxed in class 2 by default but can elect individual taxation (pure or with income reallocation), occasionally better when incomes are very unequal or one spouse has foreign income. Note for the road ahead: the government announced in 2026 a reform towards a single tax class for everyone; it is a proposal, not yet law, so class 2 logic still applies today.

The deductions that matter

For the 2025 return you file in 2026:

• Mortgage interest on your main home: deductible up to €4,000 per household member per year for the first years of occupation (ceilings taper to €3,000 then €2,000); homes made available after 31 December 2023 currently enjoy uncapped deduction under the 2024 housing measures.
• Insurance premiums and personal loan interest: up to €672 per household member (a pending reform proposes raising this to €900, not yet in force).
• Pillar 3 pension (article 111bis): €3,200 deductible for 2025, and the ceiling jumps to €4,500 per taxpayer from tax year 2026, so next year's return gets more generous.
• Home-savings plans: €672/year per household member, doubled to €1,344 if you're 18–40.
• Childcare and domestic help: flat-rate deduction up to €6,000/year (raised from €5,400 in the 2026 tax reform; the ceiling covers childcare, domestic services and dependency care combined).
• Commuting: an automatic distance allowance, capped at €2,574/year, usually applied via your tax card.

What changed for 2026

The 2025 scale already baked in an adjustment worth 2.5 index tranches, cutting tax for all classes; the tax-free threshold sits around €13,230 and the top 42% rate starts above roughly €234,870 for class 1. From January 2026, the pillar 3 ceiling rises to €4,500, a new allowance rewards working past early-retirement age (up to €9,000), and automatic inflation-indexation of the scale is slated for 2028. Treat anything beyond enacted 2026 measures as subject to change.

Deadlines and filing

The deadline is 31 December of the year following the tax year, so the 2025 return is due 31 December 2026; MyGuichet opened for it on 7 April 2026. Filing for taxation by assessment is now done electronically via MyGuichet.lu, where the guided assistant pre-fills much of the data and processes straightforward returns automatically. You'll need a LuxTrust login or eID.

First year in Luxembourg: the part-year quirk

If you arrived mid-year, your employer withheld tax as if your Luxembourg salary ran all twelve months at that level, but resident taxation looks at your actual situation, and part-year arrivals are precisely the profile that tends to get a refund by filing. Non-residents and part-year cases may need to declare worldwide income to be treated as fully resident-equivalent; this is where rules get technical.

When to pay a fiduciaire

A salaried couple with a mortgage can usually self-file with MyGuichet or a tool like taxx.lu. Hire a fiduciaire (typically €150–€500 for a personal return) when you have rental property, stock options or RSUs, income in two countries, or a departure/arrival year straddling tax treaties. The fee is often recovered several times over.

This guide is general information, not personal tax advice: check your own situation with the ACD or a professional.