Corporate social security contributions
Posted: Sat Jan 18, 2025 4:54 am
The net wealth tax () is a tax levied in Luxembourg on the net worth of companies. The tax is designed to tax the net assets of legal entities and to encourage continued investment rather than the accumulation of unproductive assets. It applies to the global net wealth of companies resident in the country and branches of foreign companies, in which case only to income generated in Luxembourg.
Standard rate: Companies with a net wealth of up to €100 million
Reduced rate: For assets above this threshold, the tax rate is .
Example: A company with a net algeria phone number library worth of €100 million ( $100 million) must pay €100 million ( $100 million) of €100 million ( $100 million) per year at a tax rate of .
These contributions are mandatory payments that companies must make in order to finance the Luxembourg social security system and cover benefits such as health, pensions and unemployment insurance. The total corporate social contributions amount on average to % of the total salary, depending on the nature of employment and industry. For example, for an employee earning €100 million ( $100 million) per year, the company pays €100 million ( $100 million) in social contributions.
Taxation of companies in Luxembourg
Taxation of companies in Luxembourg
Tax benefits in Luxembourg
The Luxembourg government has designed a tax benefits program to reduce the tax burden on businesses and individuals. These benefits are mainly focused on immigration, creating new companies and moving financial operations to the country. The main benefits are as follows:
Benefit type Description Application
Personal deductions They allow the tax base to be reduced through deductible expenses such as mortgage interest, donations and pensions. Applicable to residents and non-residents with taxable income in Luxembourg.
Standard rate: Companies with a net wealth of up to €100 million
Reduced rate: For assets above this threshold, the tax rate is .
Example: A company with a net algeria phone number library worth of €100 million ( $100 million) must pay €100 million ( $100 million) of €100 million ( $100 million) per year at a tax rate of .
These contributions are mandatory payments that companies must make in order to finance the Luxembourg social security system and cover benefits such as health, pensions and unemployment insurance. The total corporate social contributions amount on average to % of the total salary, depending on the nature of employment and industry. For example, for an employee earning €100 million ( $100 million) per year, the company pays €100 million ( $100 million) in social contributions.
Taxation of companies in Luxembourg
Taxation of companies in Luxembourg
Tax benefits in Luxembourg
The Luxembourg government has designed a tax benefits program to reduce the tax burden on businesses and individuals. These benefits are mainly focused on immigration, creating new companies and moving financial operations to the country. The main benefits are as follows:
Benefit type Description Application
Personal deductions They allow the tax base to be reduced through deductible expenses such as mortgage interest, donations and pensions. Applicable to residents and non-residents with taxable income in Luxembourg.