How to optimise your tax declaration in Luxembourg

My money and my future

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 Baloise 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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