ANNOUNCED AS TEMPORARYNo
On 31 December 2010, Luxembourg issued circular nr. 95/2 introducing tax exemptions for qualified expatriates seconded within international companies (i.e. established in at least two other countries).
Within the first five years from moving temporarily to Luxembourg, moving expenses, recurring expenses (annually up to 50'000 EUR for singles and 80'000 EUR for couples) and lump sum indemnities (annually up to 1'500 EUR for singles and 3'000 EUR for couples) will not be taxable for qualified expatriates. If these costs were incurred by the employer within the first five years of the employee relocating to Luxembourg, the expenses will also be deemed tax deductible.
The tax benefits may be applied only to Luxembourg entities hiring at least 20 employees. Furthermore, the qualified expatriates will have to earn annually at least 50'000 EUR to be eligible for the tax exemption.
The circular was amended on 21 May 2013 and is thus no longer classified as implemented (cf. Related Measures).
No affected trading partner has been mentioned, as, according to the Luxembourg Statistical Office, the migration inflow from any single country did not surpass 10'000 in 2009.
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