Adjustment of withholding tax on salaries by annual adjustment as a resident taxpayer

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Annual

Residents

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Resident taxpayers who are employees or pensioners and do not satisfy the conditions to file an income tax return (not being subject to tax on an assessment basis) may submit a request for tax relief on their wages, salaries or pensions by annual adjustment in order to obtain a refund of any excess tax withheld.

The purpose of the annual adjustment procedure (‘model 163 R F’ form) is to determine the tax applicable to the taxpayer’s annual taxable income. When the determined tax is less than the total tax withheld by the employer or pension fund, a refund is given by the tax authorities.

This procedure, available by request, cannot in principle result in any additional tax liability for the taxpayer. The request for such an annual adjustment is thus only useful to taxpayers who have good reason to expect a refund of withholding taxes on their wages or salaries (tax withheld by the employer) or on pensions (tax withheld by the pension fund).

Who is concerned

Employees or pensioners who have had tax withheld on their wages, salaries or pensions and who do not satisfy the conditions to file an income tax return (not being subject to tax on an assessment basis) may submit a request for withholding tax relief by annual adjustment (using the ‘model 163 R F’ form).

Withholding tax relief on wages, salaries or pensions by annual adjustment is generally requested:

when the employee or pensioner taxpayer wishes to claim certain tax-deductible expenses (such as extraordinary expenses) that are not listed on their tax card;
when no tax relief has been granted for a dependent child, in the form of:
- a single-parent tax credit (CIM) granted during the year via the employer or the pension fund;
- a tax allowance for children paid by the Children’s Future Fund (Caisse pour l’avenir des enfants - CAE) or granted in the form of financial aid for higher education;
- aid to volunteer workers paid by the National Youth Service (Service national de la Jeunesse - SNJ);
- other tax relief.

Deadlines

The request for annual adjustment must be filed with the relevant RTS tax office at the latest on 31 December of the year following the tax year.

How to proceed

To file a request for an adjustment of tax withholdings, a resident taxpayer may submit an annual adjustment form (‘model 163 R F’). This form consists of 6 pages:

pages 1 and 2 cover the personal details of the taxpayer and their family, the request for relief, the single-parent tax credit and the tax allowance for children. The taxpayer must also indicate periods of work or inactivity (retirement, unemployment, studies, etc.) as well as the names of their various employers and pension funds;
page 3 is used to report travel expenses and other expenses for the acquisition of income as well as the extra-professional allowance under certain conditions;
pages 4 and 5 include special expenses, such as interest paid on consumer loans, insurance contributions and premiums, etc., provided they do not exceed the minimum flat-rate allowance;
page 6 is used to report tax-deductible expenses falling into the category of extraordinary expenses.

The adjustment request may also be submitted directly online via MyGuichet.lu, by filling out an interactive questionnaire.

Taxpayers who wish to claim tax-deductible interest payments in connection with a property loan in order to request a revision of their tax liability, must file a tax return (‘model 100’ form) rather than an annual adjustment form.

For married couples or civil partners filing jointly, the taxpayer making the request and their spouse or partner must fill in a single annual adjustment form.

 When submitting their annual adjustment form, taxpayers must enclose the compensation and withholdings statements issued by Luxembourg and/or foreign employers or pension funds.

Forms / Online services

Décompte annuel (personnes physiques résidentes salariées ou pensionnées non soumises à une imposition par voie d'assiette - 163 R)

Télécharger le formulaire

Lohnsteuerjahresausgleich (ansässige steuerpflichtige Arbeitnehmer und Rentner die nicht einer Besteuerung durch Veranlagung unterliegen - 163 R)

Das Formular herunterladen

Décompte annuel - Modèle 163 - 2022

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Who to contact

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Luxembourg Inland Revenue

45, boulevard Roosevelt
L-2982 Luxembourg
Luxembourg

Please click on the link below to find the competent department.

Luxembourg Inland Revenue Path to Luxembourg Inland Revenue

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