How capital gains tax works in Luxembourg
Luxembourg taxes capital gains on personal portfolios, including shares and other securities. Gains are reported on the income tax return and added to other income.
For movable property, gains on assets held for less than six months are generally taxed at ordinary progressive rates if annual gains exceed EUR 500. Assets held for more than six months are usually exempt unless the holding is a significant participation.
A holding is significant when the taxpayer and household have held more than 10% of the company's capital at any time during the five years before disposal. Those gains can be taxed at half of the overall rate.
Tax rates at a glance
- Short-term gains
- 0% - 45.78%
- Long-term small holdings
- 0%
- Significant participation
- Half-rate
- Minimum threshold
- EUR 500
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
InvestorsTradersFoundersFamily officesExpats
Watch out for
- The old EUR 50,000 allowance for certain gains is not available for gains realised from 2023 through 2031.
- Luxembourg residents also need to watch the dependency contribution on some investment income and capital gains.
- Property gains follow separate real estate rules, so do not assume a share sale and a house sale are taxed the same way.
Frequently asked questions
Does Luxembourg tax capital gains?
Yes. Short-term gains and some significant shareholding gains are taxable, while many long-term smaller holdings are exempt.
Are share gains taxable in Luxembourg?
Yes, depending on holding period and participation size. Small shareholdings held for more than six months are generally exempt.
Do I need to file capital gains in Luxembourg?
Usually yes if the gain is taxable or reportable. The gain is typically declared on the personal income tax return.