Income tax in Luxembourg 2026: tariff from 0% to 42%, tax classes and residence

The Administration des contributions directes (ACD) separates two statuses in a few lines. You are a resident taxpayer if you have your tax domicile or habitual abode in the Grand Duchy, and you are then taxed on worldwide income, domestic and foreign. You are a non-resident if you have neither but do have income taxable in Luxembourg, and only that domestic income is then taxed. A tax domicile is the place where you hold a dwelling under conditions suggesting you will keep it and use it. A habitual abode is the place where you stay in circumstances showing you are there on more than a merely passing basis. None of these pages puts a figure on days. The ACD makes two points of use to newcomers: someone whose centre of vital interests is abroad is in principle non-resident, whatever their address, and a residence permit does not automatically mean tax residence.

The basic tariff, band by band

Basic tariff, applicable from tax year 2025: the latest adjustment the authority showed when we read it on 3 November 2026. It applies directly to tax class 1.

Its progression is very tight: from 8% to 38% in under €41,000 of income, then 39% across a long band of more than €63,000, up to €117,450. The highest rate, 42%, only arrives above €234,870. The ACD presents this tariff as applying from tax year 2025, and its scales page said, when we read it on 3 November 2026, that the latest adjustment was the one of 1 January 2025. So it had announced no other tariff for 2026 on those pages, but we cannot rule out a more recent text: the page dates from 2025, and the Legilux online collection did not display in our reading tool.

Your tax class changes the result

This table is the direct calculation only for class 1, as the ACD itself says. Resident taxpayers are sorted into three classes for applying the tariff, and the pages we read do not give the formula for classes 1a and 2; for the exact amount, the ACD points to its scales and online calculation.

Non-residents are sorted in their own way, which the ACD deals with separately, and can ask to be treated as residents (article 157 ter of the income tax law). This is open if at least 90% of your worldwide income is taxable in Luxembourg, a limit assessed each year for each spouse, or if your net income not subject to Luxembourg tax stays under €13,000. For that 90%, a salary taxable elsewhere under a treaty counts as Luxembourg income for up to 50 working days. A Belgian resident can also ask if more than 50% of the household's professional income is taxable in Luxembourg. The request goes through form 100. In exchange, you get the same deductions and credits as a resident, but your foreign income enters the calculation of your rate.

No day threshold: what a counter is for here

Here the counter will never tell you "resident". It records your presence, because a stay on more than a "merely passing" basis gets shown through facts, and a run of dates is one of them. The preloaded example, May to July and then November and December, adds up days with no automatic conclusion: a repeated assignment may look passing, or not, depending on the rest of your life. Look instead at what weighs in the ACD's texts: a dwelling kept and used, where your centre of vital interests lies, and not the address alone. A comparison with countries that do count helps you see where a threshold might catch you. The same 120-day stay, starting on 1 January and in one country:

Living on one side of the border, working on the other

For a life shared between two countries, the ACD's page points to the bilateral treaties, which it says all follow the OECD model, aim to eliminate double taxation by exemption or credit, and generally define a resident of a contracting state in article 4. We have not reread each treaty here. For an employee, the question then comes in two stages: domestic law says whether you are resident in Luxembourg, then the treaty says which state taxes that income. Our page on dual tax residency follows the usual tie-breaker tree, and the France, Belgium and Germany pages give the neighbour's rule, so you can check both sides.

Papers that make the difference

A lease or deed showing a dwelling at your disposal, with its real use, counts towards tax domicile. Registration with a commune does not appear as a criterion on the pages we read: do not treat it as proof by itself, nor deregistration as an exit. The residence permit is expressly ruled out as automatic proof. Also keep what places your family and economic life, since the centre of vital interests can overturn everything. Your dates, finally, are easy to lose: the Taxlag app stores them as the year goes on, which saves rebuilding them from tickets when someone asks. For an overview, see the country table. For your own case, the ACD is the one to answer: this site is not tax advice.