Applying for a tax credit on notarial instruments (Bëllegen Akt)

The normal rate for real estate purchases—houses, flats, building plots—is 7%, of which 6% is for registration fees and 1% is for recording fees.

To reduce the incidental expenses associated with the purchase of a dwelling, the Government has introduced a tax allowance—known as a tax credit—on registration and recording fees for anyone wishing to purchase a building (and certain outbuildings and attachments) for use as their personal residence.

This tax credit is limited to EUR 20,000 per buyer. For a couple, this amount is doubled since the tax credit applies to each buyer individually. The tax credit may be used successively for several purchases until it has been exhausted.

In all cases, the Indirect Tax Authority (

The tax credit may either be used for one or several purchases, if the registration and recording fees due for a single purchase do not exhaust the total amount of the tax credit. The remaining balance of the credit may then be used for subsequent payments.

Who is concerned

Anyone who wishes to purchase a piece of real property for use as as their personal residence, and who, at the time the notarial instrument is recorded, is:

  • either a resident in the Grand-Duchy of Luxembourg and registered with a commune's population office;
  • or not yet a resident, but who intends to reside in Luxembourg in the purchased building.

In all of the aforementioned cases, the buyer must effectively and personally occupy the purchased property within 2 years of the date of the notarial deed of purchase. This time limit is extended to 4 years if the purchased property is a building plot or a building under construction. Furthermore, the buyer must undertake to effectively and personally occupy the building for an uninterrupted period of at least 2 years except in a case of

Non-residents living in the European Economic Area are treated as residents in the sense that they will not be required to advance the registration and recording fees and to subsequently apply for reimbursement. They are automatically entitled to the tax credit, provided they have applied for it when the notarial instrument is recorded. For non-residents living in a country that is not part of the European Economic Area, the tax credit will only be granted when the applicant can present a certificate of residence in Luxembourg.

No conditions in terms of wealth, value of the building, cadastral income, or purchaser's income are taken into account.

Prerequisites

This tax reduction may be granted if a building is acquired by:

  • sale;
  • adjudication;
  • bidding (auction);
  • division;
  • exchange with returns or capital gains.

As regards the nature of the building to be used as a residence, the law provides for the granting of a tax reduction for:

  • building plots in a residential area where a structure can immediately be built in accordance with building regulations;
  • dwellings to be used by the owner as a primary, personal and effective residence. Buildings under construction are also included;
  • outbuildings (garages, sheds, barns) or other additions (gardens) which adjoin or are separate from the primary residential building, but located close to it.

Preliminary steps

 

How to proceed

Signing of the notarial instrument

The application for a tax credit is filed by the notary when the notarial instrument is drawn up, provided that the latter includes:

  1. the buyer's corresponding request;
  2. an undertaking on the part of the buyer to a) personally occupy the building within the time limits and for the term provided for by law, b) refrain from using the building for any other purpose during this period, and c) repay the amount of the tax allowance if the legally prescribed conditions are not fulfilled;
  3. an undertaking on the part of the buyer to declare in writing, to the administrative authorities, within 3 months, any transfer or change in the intended use of the building in question.

Conditions of eligibility for the tax credit

The buyer must effectively and personally occupy the dwelling within 2 years of the date of the notarial deed of purchase. This time limit is extended to 4 years if the purchased property is a building plot or a building under construction. However, these time limits may be extended in certain cases where an exception is granted by the director of the Indirect Tax Authority in response to a written and substantiated request on the part of the buyer.

For purchases of buildings documented by a notarial instrument dated on or after 1 January 2008, the buyer must also undertake to occupy the building for an uninterrupted period of at least 2 years.

Note that the signing of a preliminary sales agreement results in the immediate transfer of ownership of the building. Therefore, the 2-year occupancy period will not be observed if the building is transferred by signing a preliminary sales agreement before this term has expired. Nevertheless, it is possible to postpone the moment at which the ownership of the building is transferred to the day on which the notarial instrument is signed by inserting a special clause in the preliminary sales agreement, such as, for example: "ownership of the building will be transferred on the date on which the authentic instrument is signed". If there is such a clause, the 2-year period will be considered to have been observed even if the agreement is signed before the term expires, provided that the authenticated instrument is signed after the 2-year term;

It should be noted that the initial law provided for an occupancy period of at least 5 years. This occupancy period was set to at least 2 years (law of 22 October 2008) for purchases of buildings documented by a notarial instrument dated on or after 1 January 2008.

For purchases of buildings documented by notarial instrument dated before 1 January 2008, there are 2 possible scenarios:

  • occupancy of the building started before 1 November 2008: the occupancy period remaining as of 1 November 2008 may not under any circumstance exceed 2 years. If the period to be observed in application of the former law (5-year occupancy period) was reached on a date prior to 1 November 2010, the duration-of-occupancy condition is satisfied at that date;
  • occupancy of the building began after 1 November 2008: the occupancy period is 2 years from the effective date of occupancy.

However, the Director of the Indirect Tax Authority may exempt the buyer from having to satisfy this duration-of-occupancy condition if the latter cannot be satisfied due to reasons of force majeure, or to a situation such as:

  • an illness—attested by a medical certificate—preventing the buyer from occupying the building;
  • the forced sale of the building;
  • expropriation for reasons of public utility;
  • the death of the buyer's spouse;
  • divorce or dissolution of a legal partnership.
If the building is let out—even partially—or transferred, or if occupancy is interrupted within the 2-year time limit, the buyer will be required to reimburse the tax allowance in its entirety, with legal interest payable from the date the allowance was granted.

However, if occupancy is interrupted on account of an obligation on the part of the buyer to transfer the location of their residence for professional reasons beyond their control, they may be exempted—by the Director of the Indirect Tax Authority—from having to reimburse the allowance, provided that occupancy is resumed once the buyer returns and until a total occupancy period of 2 years has been completed.

Consulting the balance on the remaining tax credit.

The remaining balance of the tax credit for any subsequent notarial instruments may be viewed online via MyGuichet.

Forms / Online services

Tax credit on notarial deeds

To complete your application, the information about you collected from this form needs to be processed by the public administration concerned.

That information is kept by the administration in question for as long as it is required to achieve the purpose of the processing operation(s).

Your data will be shared with other public administrations that are necessary for the processing of your application. For details on which departments will have access to the data on this form, please contact the public administration you are filing your application with.

Under the terms of Regulation (EU) 2016/679 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, you have the right to access, rectify or, where applicable, remove any information relating to you. You are also entitled to withdraw your consent at any time.

Additionally, unless the processing of your personal data is compulsory, you may, with legitimate reasons, oppose the processing of such data.

If you wish to exercise these rights and/or obtain a record of the information held about you, please contact the administration in question using the contact details provided on the form. You are also entitled to file a claim with the National Commission for Data Protection (Commission nationale pour la protection des données), headquartered at 1, Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette.

By submitting your application, you agree that your personal data may be processed as part of the application process.

Crédit d'impôt sur acte notarié

Les informations qui vous concernent recueillies sur ce formulaire font l’objet d’un traitement par l’administration concernée afin de mener à bien votre demande.

Ces informations sont conservées pour la durée nécessaire par l’administration à la réalisation de la finalité du traitement

Les destinataires de vos données sont les administrations compétentes dans le cadre du traitement de votre demande. Veuillez-vous adresser à l’administration concernée par votre demande pour connaître les destinataires des données figurant sur ce formulaire. Conformément au règlement (UE) 2016/679 relatif à la protection des personnes physiques à l'égard du traitement des données à caractère personnel et à la libre circulation de ces données, vous bénéficiez d’un droit d’accès, de rectification et le cas échéant d’effacement des informations vous concernant. Vous disposez également du droit de retirer votre consentement à tout moment.

En outre et excepté le cas où le traitement de vos données présente un caractère obligatoire, vous pouvez, pour des motifs légitimes, vous y opposer.

Si vous souhaitez exercer ces droits et/ou obtenir communication de vos informations, veuillez-vous adresser à l’administration concernée suivant les coordonnées indiquées dans le formulaire. Vous avez également la possibilité d’introduire une réclamation auprès de la Commission nationale pour la protection des données ayant son siège à 1 Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette.

En poursuivant votre démarche, vous acceptez que vos données personnelles soient traitées dans le cadre de votre demande.

Steuerkredit auf notarielle Urkunden

Ihre in diesem Formular erfassten personenbezogenen Informationen werden von der zuständigen Verwaltungsbehörde verarbeitet, um Ihren Antrag erfolgreich abzuschließen.

Diese Informationen werden von der Behörde für den zur Verarbeitung erforderlichen Zeitraum gespeichert.

Die Empfänger Ihrer Daten sind die im Rahmen Ihres Antrags zuständigen Verwaltungsbehörden. Um die Empfänger der in diesem Formular erfassten Daten zu erfahren, wenden Sie sich bitte an die für Ihren Antrag zuständige Behörde.

Gemäß der Verordnung (EU) 2016/679 zum Schutz natürlicher Personen bei der Verarbeitung personenbezogener Daten und zum freien Datenverkehr haben Sie das Recht auf Zugang, Berichtigung und gegebenenfalls Löschung Ihrer personenbezogenen Informationen. Sie haben zudem das Recht, Ihre erteilte Einwilligung jederzeit zu widerrufen.

Weiterhin können Sie, außer in Fällen, in denen die Verarbeitung Ihrer Daten verpflichtend ist, Widerspruch einlegen, wenn dieser rechtmäßig begründet ist.

Wenn Sie diese Rechte ausüben und/oder Einsicht in Ihre Informationen nehmen möchten, können Sie sich unter den im Formular angegebenen Kontaktdaten an die zuständige Verwaltungsbehörde wenden. Sie haben außerdem die Möglichkeit, bei der Nationalen Kommission für den Datenschutz Beschwerde einzulegen (Commission nationale pour la protection des données, 1, Avenue du Rock'n'Roll, L-4361 Esch-sur-Alzette).

Wenn Sie Ihren Vorgang fortsetzen, akzeptieren Sie damit, dass Ihre personenbezogenen Daten im Rahmen Ihres Antrags verarbeitet werden.

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