Luxembourg

Tax residency

Under Article 2 of the Luxembourg Income Tax Law (Loi concernant l'impôt sur le revenu, L.I.R.), an individual is a Luxembourg resident if they have either a tax domicile or a habitual abode in Luxembourg.

The two criteria are alternatives: satisfying either domicile fiscal or séjour habituel is sufficient for domestic tax residence.

The Administration des contributions directes (ACD) also states that, independently of the individual's address, a person is in principle considered non-resident when their centre of vital interests is outside Luxembourg. This is a relevant qualification rather than a separate third statutory residence test.

• Tax domicile (domicile fiscal): a tax domicile exists where an individual has a dwelling in circumstances indicating that the dwelling will be maintained and used by the individual.
• Habitual abode (séjour habituel): habitual abode is established where an individual stays in circumstances indicating that the stay is not merely temporary. The legislation also provides a statutory presumption where the stay is continuous for more than six months.

Day counting

For tracking purposes, Luxembourg stays should therefore be recorded as continuous periods of presence, with departures and returns reviewed to determine whether an absence interrupts the continuity of the stay.

• Tax domicile (domicile fiscal): no minimum number of days is prescribed. The assessment focuses on the availability of a dwelling and the circumstances indicating that it is maintained and used by the individual.
• Habitual abode (séjour habituel): the statutory day-counting rule is based on a continuous stay exceeding six months. Short temporary absences are disregarded under the statutory rules governing continuity of the stay. Where the six-month condition is satisfied, the resulting unlimited tax liability applies from the beginning of the relevant stay.

Tax consequences

Luxembourg tax residents are generally subject to Luxembourg income tax on their worldwide income, while non-residents are generally subject to Luxembourg income tax on Luxembourg-source income. Where an individual is resident for only part of the tax year, the resident and non-resident periods are treated separately for Luxembourg tax purposes.

Migration / EU residence

EU/EEA and Swiss nationals benefit from EU free-movement rules. For stays exceeding three months, registration or other residence formalities may apply under the applicable immigration framework. Third-country nationals generally require a visa and/or residence permit depending on the purpose and duration of the stay. Obtaining a Luxembourg residence permit does not by itself establish Luxembourg tax residence.

Orientation references

• Loi concernant l'impôt sur le revenu (L.I.R.), Article 2, statutory basis for the resident/non-resident distinction for individuals.
• Steueranpassungsgesetz (StAnpG), § 13, statutory definition of domicile fiscal.
• Steueranpassungsgesetz (StAnpG), § 14, statutory definition of séjour habituel and the six-month rule.
• Administration des contributions directes (ACD), “Résident / non-résident”, official explanation of resident and non-resident status, worldwide taxation and the distinction between tax residence and immigration residence.
• Luxembourg immigration / EU free-movement framework