By the end of June, several specific housing tax incentives will no longer apply in Luxembourg.
Introduced on a temporary basis in 2024 to revive a struggling property market, the incentives were extended until 30 June 2025. After this date, they will no longer be available to residents. However, they will be able to benefit from a grace period.
To counter a ‘significant influx of applications’ between now and the end of the month, the Minister of Finance has added a degree of flexibility: the deadline will remain in place, but purchasers will only need to register either a signed preliminary sale agreement or a signed reservation contract for a sale in the future state of completion with the Registration, Domains and VAT Administration (AED) by that date at the latest.
The purchase must then be formalised by a notarised deed signed between 1 July 2025 and 30 September 2025.
This deadline will allow banks and notaries to process the many requests from buyers who wish to benefit from one of the following tax advantages:
- a rental tax credit of €20,000 per individual
- a 50% reduction in the taxable base for registration and transcription fees
- accelerated depreciation at 6%
- taxation of capital gains at a quarter of the overall rate, and
- capital gains tax exemption in the case of transfers involving properties used for social rental management or residential buildings achieving A+ energy efficiency rating.
Finally, please note that the ‘Bëllegen Akt’ tax credit for the purchase of a home for personal use is not affected by the law proposed by Gilles Roth’s ministry. It will remain at 40,000 euros beyond the 30 June 2025 deadline.
Source: RTL INFO
See the Ministry of Finance publication:
https://mfin.gouvernement.lu/en/actualites.gouvernement2024+en+actualites+toutes_actualites+communiques+2025+06-juin+02-roth-avantages-fiscaux.html
