My money and my future

How to optimise your tax declaration in Luxembourg

November 30, 2021
How to pay less tax? Everyone knows that it’s possible to deduct certain expenses from their tax return, such as interest on a mortgage, or the costs of child care or housekeeping. The premiums paid for many insurance products are also deductible.

What are the possible tax deductions?

Many insurance payments or premiums are considered as special expenses and may therefore be deducted from your tax return. These include premiums paid in respect of life, death, accident, disability, sickness, or third-party liability insurance policies, in accordance with Article 111.

What deductions are possible within the meaning of Article 111?

Article 111-L.I.R.

The maximum deduction possible for premiums paid in respect of insurance policies covering life, death, accident, disability, sickness, or third-party liability are as follows:

  Without a spouse With a spouse
Without a child EUR 672 EUR 1,344
With 1 child EUR 1,344 EUR 2,016
With 2 children EUR 2,016 EUR 2,688
With 3 children EUR 2,688 EUR 3,360
With 4 children EUR 3,360 EUR 4,032
+ for each additional child EUR +672 EUR +672

 

Article 111-L.I.R. for single premium “Outstanding Balance” insurance

In the case of outstanding balance insurance (which covers the purchase of the main home) paid in a single premium, the deductible amounts are increased and specified in the table below.

  Up to 30 years of age Increased, for each completed year from age 31 to 49 For age 50 and above
Without a child EUR 6,000 EUR 480 EUR 15,600
With 1 child EUR 7,200 EUR 576 EUR 18,720
With 2 children EUR 8,400 EUR 672 EUR 21,840
With 3 children EUR 9,600 EUR 768 EUR 24,960
With 4 children EUR 10,800 EUR 864 EUR 28,080

 

Article 111-bis for pension scheme

Article 111-bis provides a maximum deduction of EUR 3,200 per year and per taxpayer, for premiums paid into a ‘retirement pension’ type of policy. 

Which Bâloise Assurances’ products are eligible for tax deductions?

All premiums paid for the following products may be deducted for tax purposes, up to the maximum amounts indicated above, depending on each taxpayer’s personal situation.         

  Article 111 LIR Article 111bis LIR
Drive public liability                                 
Private Life public liability                                 
B Safe                                 
Temporary death benefits                                 
Outstanding Balance insurance                                 
Life Plan (1)                                 
Kid’s Plan (1)                                 
Pension Plan                                 

 

(1) Minimum period of 10 years and additional death cover are essential.

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Have you used enough of your available tax relief for this year?

Contact one of our agents before 31 December in order to optimise your tax declaration again for this year.