Luxembourg Tax Calculator (2026)

Assumptions

• · Model uses Tax Class 1 (single person) as default representative employee.
• · Solidarity tax of 7% applied to income tax liability (standard rate for incomes up to EUR 150,000).
• · Employee tax credit modeled as tiered credit phasing from EUR 600 at low income to EUR 0 at higher income.
• · Social security contributions (sickness 2.80%, pension 8%) are deductible from gross income before income tax calculation.
• · Dependency contribution (1.4%) applied to gross income reduced by EUR 8,045.32 annual ceiling (EUR 675.94/month).
• · Minimum standard employment deduction of EUR 540 included in income-based deductions.
• · Commuting expense deduction limited to EUR 2,574 per year; modeled as percentage of income with maximum cap.
• · Life/disability insurance and loan interest deduction of EUR 672 per year included as flat standard deduction.
• · Employee contributions to employer pension schemes up to EUR 1,200/year are tax-deductible.
• · CISSM (minimum wage credit) not modeled as it applies only to gross monthly salary EUR 1,800–EUR 3,600; falls outside typical salary-comparison use case.
• · CO2 tax credit of EUR 192 per year included as flat credit.
• · Personal allowance for jointly taxable spouses (EUR 4,500) not applicable to single default person.
• · Non-resident rules and extraordinary charges deductions excluded as outside default resident employee scope.
• · Tax brackets simplified from index-adjusted 2025 scale; rates applied progressively.
• · All figures reflect 2025 tax year indexation.

Frequently asked questions