Lüksemburg - emlak vergisi rehberi

Corporate income tax

The standard corporate income tax rate (CIT) is 29.63% for 2006 (previously 30.38%), including municipal business tax in Luxembourg City, and is payable by Luxembourg-resident entities and non-residents in respect of Luxembourg sourced income derived through a Luxembourg permanent establishment.

CIT is generally reportable on a calendar year basis.  However, Luxembourg tax authorities also accept tax returns prepared on an acounting year basis.

Regulated real estate ‘undertakings for collective investments’ (UCIs) are exempt from CIT in Luxembourg. However, they are subject to a fixed capital duty (EUR 1,250) and annual subscription tax.

Capital gains

Capital gains realised by Luxembourg residents and derived through a Luxembourg permanent establishment by non-resident entities on the sale of Luxembourg property are chargeable to CIT at the standard rate.

Property tax

Real estate tax (Impôt foncier), is charged by municipalities at varying rates (depending on the location and nature of the property) on the unitary value of the property as determined by the tax authorities.  The unitary value is generally 5% to 10% of the market value of the property.

Luxembourg companies are subject to annual net worth tax at 0.5% of the unitary value of the company as at 1 January each year.  The unitary value is, in principle, based on the market value of all the company’s assets as at 31 December each year (including cash and receivables) less the market value of the liabilities at the same date with some adjustments.

Property situated outside Luxembourg held directly by the company is not usually taken into consideration for the net worth taxable base, provided that the Double Tax Treaty between the Luxembourg and the relevant country provides that this country has the right to levy net worth tax on such assets. Luxembourg property is taken into account at the unitary value, which is based on the unitary value in 1941 and therefore usually minimal.

Registration duty

Transfer of ownership of property situated in Luxembourg is generally subject to 6% registration duty and 1% transcription tax.  Transfers of real estate situated outside of Luxembourg are outside the scope of registration duty and transcription tax.  The sale of property located in Luxembourg City is generally subject to 9% registration duty (including a municipal surcharge of 3%) and 1% transcription tax. Specific rules apply if there is an intention to resell the property within 2 or 4 years.

VAT

The sale of property is generally VAT exempt.  However, this exemption does not apply to commercial buildings sold prior to their completion.  In this case, VAT is charged at 15% on the proportion of the sale price which relates to the part of the building which is yet to be constructed.

The lease of unfurnished property is generally VAT exempt, whereas the lease of furnished property is always subject to VAT at 15%.

VAT exemptions can be waived in certain circumstances.


The above is for general information purposes only. It is not intended to be comprehensive or to provide any specific tax advice.

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