Luxembourg: Individual income tax; wage tax guidance - KPMG Global
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Luxembourg: Tax circulars on individual income tax; wage tax guidance

Luxembourg: Individual income tax; wage tax guidance

The Luxembourg tax authorities in August 2017 released four tax circulars with respect to individual income tax. These new tax circulars provide certain clarifications following enactment of the 2016 family allowance and the 2017 tax reform measures.


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The circulars address:

  • The family allowance and its effect on the “tax moderation” available for taxpayers with children
  • How to determine the number of tax moderations for children in the taxpayer’s household
  • The education allowance for children who are not part of the taxpayer’s household
  • How to compute the single parent tax credit

The Luxembourg tax authorities also in August 2017 released guidance in the form of a newsletter concerning specific wage or salary tax requirements. A new tax form is available to Luxembourg employers and to Luxembourg non-resident employees who do not fall under Luxembourg social security system. The form can be used to apply for a tax file number, enabling an employer to correctly process the Luxembourg wage tax and allowing local tax authorities to conduct the mandatory automatic exchange of salaried information.


Read an August 2017 report prepared by the KPMG member firm in Luxembourg

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