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Mortgage interest, insurance premiums, pension savings under article 111bis, childcare costs: Luxembourg offers generous deductions if you claim them. Overview of the main ceilings, including the new EUR 4,500 pension ceiling from 2026.
Luxembourg's tax system lets you deduct many private expenses – but nothing is applied automatically: you have to claim them. For a household, these deductions often mean several hundred or even thousands of euros less tax every year.
| Expense | Annual ceiling |
|---|---|
| Mortgage interest (main residence) | EUR 4,000 per household member (recent occupation), then a decreasing ceiling (EUR 3,000, then EUR 2,000) |
| Insurance premiums and debit interest (art. 111) | EUR 672 per household member |
| Pension savings (art. 111bis) | EUR 3,200 until 2025; EUR 4,500 from 2026 |
| Childcare / domestic help costs | lump sum up to EUR 5,400 |
| Home savings plan | EUR 672 (EUR 1,344 if under 41) |
Interest paid on the loan for your main residence is deductible up to a ceiling per person living in the household, higher during the first years of occupation. Interest on consumer credit falls instead under the article 111 ceiling together with insurance premiums.
Civil liability insurance, third-party car insurance, life, death and top-up health insurance all count towards the EUR 672 per-person ceiling. A pension savings contract (article 111bis) enjoys a separate ceiling: the government has announced its increase from EUR 3,200 to EUR 4,500 per year from 2026 – a major optimisation lever for residents.
Costs for a crèche, day-care centre or household help entitle you to a lump-sum allowance of up to EUR 5,400 per year, with supporting documents.
Note: ceilings and conditions change regularly. Always check the amounts for the relevant year on the ACD website before filing.
