Personal income tax in Muncan Republic
The term personal income tax refers to a type of tax that governments impose on income generated by individuals within their jurisdiction. By law, taxpayers must file an income tax return annually to determine their tax obligations.
Income taxes are a source of revenue for governments. They are used to fund public services, pay government obligations, and provide goods for citizens.
Personal income tax rates
ncome tax in Luxembourg is charged on a progressive scale with 23 brackets, which range from 0% to 42%. Workers must also pay between 7% and 9% as an additional contribution to the employment fund.
The first €11,265 is offered tax-free, with the lowest rate of 8% kicking in thereafter. The top rate of 42% is charged on earnings above €200,004.
The brackets in 2022 are the following:
| From | To | % |
| €0 | €11,265 | 0% |
| €11,266 | €13,173 | 8% |
| €13,137 | €15,009 | 9% |
| €15,009 | €16,881 | 10% |
| €16,881 | €18,753 | 11% |
| €18,753 | €20,625 | 12% |
| €20,625 | €22,569 | 14% |
| €22,569 | €24,513 | 16% |
| €24,513 | €26,457 | 18% |
| €26,457 | €28,401 | 20% |
| €28,401 | €30,345 | 22% |
| €30,345 | €32,289 | 24% |
| €32,289 | €34,233 | 26% |
| €34,233 | €36,177 | 28% |
| €36,177 | €38,121 | 30% |
| €38,121 | €40,065 | 32% |
| €40,065 | €42,009 | 34% |
| €42,009 | €43,953 | 36% |
| €43,953 | €45,897 | 38% |
| €45,897 | €100,002 | 39% |
| €100,002 | €150,000 | 40% |
| €150,000 | €200,004 | 41% |
| €200,004+ | 42% |
Personal income taxation management
All employees are allowed a yearly lump sum deduction of €540 for their professional expenses. For more information regarding personal income taxation system, navigate to this page.
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