Tax law
Tax card
An overview of our services
Tax classes
1, 1a and 2
Additional cards and flat rates
Class 1: 33% - Class 1a: 21%
Class 2: 15%
Tax credit for employees (CIS)
€ 300 per year
Tax credit for single parents residing in
Luxembourg (CIM)
€ 750 per year
Labour Law
Legal information
Working time & leaves
Staff representation
Benefits in kind
Company car
Lunch vouchers
- Real taxation based on the cost per
kilometer, or
Benefit exempted from taxes and social
contributions if:
- Monthly lump-sum taxation: 1.5% of
the purchase value of the new vehicle
(incl. VAT and options)
- Minimum contribution of the employee
by voucher = € 2.80
Absenteeism
- Maximum contribution of the employer
by voucher = € 5.60
If private car, the reimbursement of a per km charge for business trips can be
free of tax up to 0.30 €/km.
Interests refund
Maximum tax exemption per year
Loan for primary residence
Personal loan
Single person
€ 3,000
€ 500
Household (joint taxation)
€ 6,000
€ 1,000
Single parent
€ 6,000
€ 1,000
Who must file a tax return?
- If taxable incomes above € 100,000
- If simultaneous incomes :
- above € 36,000 for taxpayers in tax class 1 or 2
- above € 30,000 for taxpayers in tax class 1a
- If joint taxation in Luxembourg (both spouses taxable in Luxembourg)
- On the tax administration’s request
Mobility
Health & Accident
Family benefits
Legal retirement
Salary
package
We set up this guide to provide you
with an overview of existing rules in
Luxembourg and thus for information
purposes only. This guide does not
constitute legal or other professional
advice and readers should not act
upon the information contained in this
guide without consulting professional
consultants. Furthermore, legislation
being in constant change and often
amended, please do not hesitate to
contact us to be informed of the last
updates. Consultation of this guide
will not create any kind of relationship
between SD Worx and the reader.
2016
Payroll
Comp & Ben
Legal procedures
Income tax return
Download your HR Operational Guide
in another language:
www.sdworx.lu/HRGuide-FR
www.sdworx.lu/HRGuide-DE
Social Security
Individual & Wage Tax
For more information,
contact us on
[email protected]
Your HR Operational Guide
SD Worx
89F, rue Pafebruch, BP1
L - 8301 Luxembourg
Tél.: +352 269 29 1
Fax: +352 269 293 206
E-mail: [email protected]
www.sdworx.lu
Employment law
Social security
Extraordinary leave
Minimum remuneration (index 775.17)
Minimum statutory wage for non-qualified worker above 18 = € 1,922.96
Minimum statutory wage for qualified worker = € 2,307.56
Student contract
Student’s age
15 - 17 years old
17 - 18 years old
As of 18 years old
Hourly rate
€ 6.6692
€ 7.1139
€ 8.8923
Monthly rate
€ 1,153.78
€ 1,230.70
€ 1,538.37
Length
6 days
3 days
2 days
2 days
2 days
1 day
1 day
Extraordinary leaves available to spouses are also opened to registered
partners.
Possibility of tax exemption if the net hourly wage does not exceed € 14.
1st day of
sickness + end
of the month
when 77th day
of sickness falls
Employer
Payment of
net salary
Mutualité des
Employeurs
(MDE)
Reimbursement
80% salary
+ employers
social
contributions
(ceiling)
Trial period
Working time
Legal working time:
8 hours a day and 40 hours a week
Measures exist in order to increase flexibility of working hours.
Legal overtime compensation for 1 hour:
- In time: 1h30, or
- Premium 40% (+ base 100%)
Leave
25 working days of annual leave
10 public holidays:
New Year’s Day, Easter Monday, Labour Day, Ascension Day, Whit Monday, National
Holiday, Assumption Day, All Saints’ Day, Christmas Day and St. Stephen’s Day
A public holiday falling on a non-working day will be replaced by a
compensatory day off to be taken within a period of 3 months.
Requirements
Less than “CATP”/”DAP” level
When at least
“CATP”/”DAP” level
Maximum length of trial period
3 months
˜
6 months
Notice period
15 days
˜
24 days
When gross monthly wage
> € 4,154.91 (index 775.17)
˜
12 months
˜
1 month
Termination
Termination
Seniority
0 – 5 years
5 – 10 years
10 – 15 years
15 – 20 years
20 – 25 years
25 – 30 years
> 30 years
By the employer
Notice period
2 months
4 months
6 months
6 months
6 months
6 months
6 months
Maternity and parental leave
Sickness
Reason
Marriage of the employee
Death of spouse or first degree parent or ally
Marriage of a child
Birth of a child
Moving
Death of second degree parent or ally
Enlistment to military service
Severance pay
0 months
1 month
2 months
3 months
6 months
9 months
12 months
By the employee
Notice period
1 month
2 months
3 months
3 months
3 months
3 months
3 months
Collective agreements can always be more favourable than legal regulations.
Caisse Nationale
de Santé (CNS)
Maternity leave
Sickness
up to 52
weeks
52nd week
of sickness
The payment is undertaken by the “Caisse Nationale de Santé”.
- Prenatal leave: 8 weeks before the presumed date of birth
Automatic
termination of
employment
contract
- Postnatal leave: 8 weeks after the date of birth (can be extended up to 12 weeks)
Parental leave
The payment is undertaken by the “Caisse Nationale des Prestations Familiales”.
Parental Leave
Full-time
Part-time
Payment
of sickness
allowance
Cessation
of sickness
allowance
Length
6 months
12 months
Gross monthly allowance
€ 1,778.31
€ 889.15
Allowances
Monthly child allowance (boni pour enfant): € 76.88 per child
Family allowances
Social contributions
From the 1st day of sickness until the end of the month in which falls the 77th day of
sickness, the employer will pay the salary and get reimbursement from the MDE. After
this period, the CNS will pay directly the employee, and thus until the 52nd week of
sickness. At the 52nd week, the employment contract will automatically lapse.
Social contributions 2016
Risk
Healthcare insurance - benefits in kind
Healthcare insurance - benefits in cash
Pension insurance
Long-term care insurance (abatement up to € 480.74)
Accident insurance
Health at work
Mutualité des Employeurs
Employer
2.80%
0.25%
8.00%
1.00%
0.11%
0.46% up to 2.93%
Basis of contributions is capped at 5 x minimum statutory wage
(i.e. € 9,614.82), except for long-term care insurance.
Employee
2.80%
0.25%
8.00%
1.40%
-
1 child
2 children
3 children
Each subsequent child
Monthly amounts
€ 185.60
€ 440.72
€ 802.74
+ € 361.82
Supplement according to age
6 – 11 years old
12 + years old
+ € 16.17
+ € 48.52
Pension
Legal retirement pension: 65 years old
Early retirement :
- 57 years old if 480 months of compulsory social contributions
- 60 years old if 480 months of compulsory, voluntary and assimilated insurance
periods