How can I deduct insurance premiums from my taxes in Luxembourg?

In Luxembourg, several types of insurance allow you to reduce your tax bill by deducting premiums from your taxable income, in accordance with article 111 L.I.R. (Loi sur l'impôt sur le revenu). Which insurances are concerned? How can you deduct these amounts from your tax return?

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1 - Tax-deductible insurance in Luxembourg 2 - Conditions and limits for deducting insurance premiums 3 - How to declare insurance premiums as special expenses (DS)?

1. Tax-deductible insurance in Luxembourg

When insurance premiums are linked to the person or the person's civil liability, they can be deducted from taxes. These include :

• Life insurance

• Disability, bodily injury, accident and illness insurance

• Civil liability insurance (RC): home, vehicle, private life

• Death insurance for remaining balance: taken out to guarantee repayment of a loan in the event of death, paid as a single premium or on a periodic basis

• Contributions to mutual aid societies: supplementary health, hospitalization, etc.

2. Conditions and deduction limits for insurance premiums

Some deductions for insurance premiums or contributions are subject to specific conditions.

• Ceiling for insurance premiums (excluding single-premium ASRD and retirement savings)

Insurance premiums are subject to an overall cap of €672 per year per member of the tax household. This amount is increased by €672 for each member of the tax household (spouse, child).

For example, a married couple with one dependent child can deduct up to €672 x 3, or €2,016 per year.

• Single premium for outstanding balance insurance (ASRD)

When paid as a periodic premium, the deductible amount of the Assurance Décès Solde Restant Dû (ASRD) is subject to the standard ceiling of article 111 LIR. However, the taxpayer may benefit from an additional increase in the deductible ceiling in the event of payment in the form of a single premium when taking out Outstanding Balance Death Insurance (ASRD), subject to certain conditions.

Conditions of eligibility:

• The cap is granted for the main residence only.

• It does not apply to credit redemptions or property share redemptions.

• It can be used every 5 years.

Maximum deductible single premium:

Number of children	Up to 30 years	From age 31 to age 49, per completed year	50 years and up
No children	€6,000	+€480	€15,600
One child	€7,200	+€576	€18,720
Two children	€8,400	+€672	€21,840
Three children	€9,600	+€768	€24,960
Four children	€10,800	+€864	€20,080

Single premium mark-up:

If, at the time of purchase, you are over 30 years of age, the deductible amount is increased by 8% for each year over 30, up to a maximum of 160%.

• Retirement savings premiums or "prévoyance"

In Luxembourg, the maximum annual deductible amount for a retirement savings contract is set at €3,200 per taxpayer. The policyholder may deduct only his or her own payments (art. 111Bis L.I.R.).

Conditions of eligibility:

• Minimum contract term of 10 years.

• Benefit payable no earlier than age 60 and no later than age 75.

• No early repayment except for serious illness or disability.

• Age limit for subscription: 65.

ℹ︎Specific condition to non-resident taxpayers:

Non-resident taxpayers must be assimilated for tax purposes, i.e. have elected to be treated as resident taxpayers for tax purposes, in order to be able to deduct premiums paid into a retirement savings contract from their taxes.

3. How do I declare my insurance premiums as special expenses?

1. Ask your insurer, relief fund or credit institution for tax certificates.

2. Complete your tax return, entering the deductible amounts in the appropriate sections. ➤ From page 13 of the income tax return (model 100) for resident or assimilated non-resident taxpayers:

   ✓ Section B.b) “Insurance premiums and contributions” for single-premium premiums and outstanding balance, page 14.

   ✓ ”Pension provision” for retirement savings, page 15.

3. Attach documents

4. Send the declaration by December 31 of the year following the relevant tax year, at the latest.

ℹ︎If you are a resident but do not meet the conditions for submitting an income tax return, use model 163 RF (annual statement) on page 4.

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Don't hesitate to contact your Foyer agent if you need any certificate.