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Your Luxembourg tax class — 1, 1a or 2 — depends on your family situation and can change your net salary by hundreds of euros a month. Here is how the classes work, how non-residents are treated, and what the planned single-class reform changes.
In Luxembourg, the amount of tax withheld from your salary depends first on your tax class, printed on your withholding tax card (fiche de retenue d'impôt) issued by the ACD (Administration des contributions directes). Same salary, different class: the net can differ by hundreds of euros.
| Class | Who is in it (main cases) |
|---|---|
| 1 | Single persons without children; married non-residents by default |
| 1a | Single parents with a child in the household entitling to tax relief; widowed persons (outside the class 2 transitional period); single, divorced, or separated persons aged 65+ |
| 2 | Married couples (joint taxation); civil partners on request via the annual return; widowed persons (year of death + 3 years); divorced or separated persons during a transitional period (year of divorce + 3 years, subject to conditions) |
Class 2 applies a splitting mechanism: the couple's joint income is taxed as if each spouse earned half, which usually lowers the average rate — especially when incomes are unequal. Civil partners (PACS or equivalent) are not in class 2 during the year, but can obtain joint taxation retroactively by filing a return, if the partnership existed for the whole year and they shared a home.
Married cross-border workers are placed in class 1 by default (with a flat rate of 15% or standard class 1 tax rates). They can request assimilation to residents — and thus class 2 treatment with a rate based on global household income — broadly when at least 90 % of their income (or 50 % of the household's professional income for Belgian residents) is taxable in Luxembourg. The request results in a mandatory annual tax return.
The government has tabled a draft law to replace classes 1, 1a and 2 with a single tax class with individual taxation, planned to apply from the 2028 tax year, with transition measures. Until it is voted and enters into force, the current three-class system fully applies — follow the official announcements before making decisions based on the reform.
