Menu Close
0 Résultat

Did you know that in Luxembourg, signing up for certain savings and life insurance products can help you reduce your annual tax bill?
Overview of BGL BNP Paribas’s solutions, which offer attractive tax benefits.

Safeguard your future while paying less tax!

Who is eligible for tax allowances?

Tax allowances are granted to Luxembourg residents and to “equivalent” non-residents.
Cross-border workers earning most of their income in the Grand Duchy of Luxembourg can ask to be treated as residents for tax purposes. They can then pay taxes under the same tax regime. This allows them to take advantage of potential tax breaks.

OptiSave: gradually build up savings and reduce your tax bill

Are you looking to build up savings for a trip around the world, to buy a home or to achieve a long-term goal? The OptiSave life insurance by Cardif Lux Vie(1) enables you to:

  • reach your savings goals;
  • safeguard your future;
  • protect your loved ones;
  • take advantage of tax allowances.

Regular, scheduled saving

You set the payment amount and frequency at the start of the policy:

  • you can change your payment plan at any time;
  • you invest your premiums in the fund of your choosing, according to your risk profile and objectives;
  • for maximum security, opt for the guaranteed minimum rate option: the amount of capital at maturity is calculated when you subscribe to the policy.

Tax deductible life insurance

Think of your loved ones by choosing from a range of supplementary guarantees. These guarantees make it possible to construct a truly personalised insurance policy.
Any premiums paid under the policy will be tax-deductible up to €672 per person belonging to the tax household and per annum, provided the policy is held for at least 10 years and subject to compliance with the terms and conditions set out in Article 111 of the Luxembourg Income Tax Law (LIR). This ceiling applies for all eligible insurance policies and debit interest.
 

Family situation Single Married or in civil partnership
Taxpayer EUR 672 EUR 1.344
Taxpayer + 1 child EUR 1.344 EUR 2.016
Taxpayer + 2 children EUR 2.016 EUR 2.688
Taxpayer + 3 children EUR 2.688 EUR 3.360
Per chil EUR + 672 EUR + 672

OptiPension+: prepare for retirement and reduce your income tax bill

Take advantage of a tailor-made policy

OptiPension+ is both a personalised savings scheme and pension insurance:

  • you choose the amount and frequency of premium payments;
  • you choose your investment strategy;
  • you can access your savings from the age of 60;
  • at the end of the policy, you can choose to redeem all or part of your savings in the form of a monthly annuity.

....not to mention tax benefits

As a Luxembourg tax resident or equivalent, the annual tax ceiling is €3,200 per person.
To be tax deductible, the policy must be taken out for at least 10 years and must not mature before you reach the age of 60.
Maximum deductible amounts for pension insurance (OptiPension+)

Good to know

Given the tax aspects of these retirement savings products, only policies taken out with Luxembourg insurance companies are deductible in Luxembourg.

OptiKids: protect your child’s future while benefiting from tax relief

The OptiKids life insurance policy by Cardif Lux Vie(3) can be taken out by parents and relatives, helping you gradually build up capital while benefiting from a range of benefits.

Take out a flexible and secure life insurance policy..

  • you set the target capital amount or the amount and frequency of premium payments, at the outset;
  • you set the policy term;
  • you’re free to extend the policy until your child turns 25 or 30;
  • you know in advance the minimum capital amount your child will receive at the end of the policy.

… and enjoy tax benefits

You can deduct up to EUR 672 of the premiums you pay into the policy for each member of the tax household. This applies provided that:

  • the policy is held for a 10-year minimum;
  • the other conditions set out in Article 111 LIR are complied with.
you set the target capital amount or the amount and frequency of premium payments, at the outset;
you set the policy term;
you’re free to extend the policy until your child turns 25 or 30;
you know in advance the minimum capital amount your child will receive at the end of the policy.

Schwäbisch Hall: the home savings scheme to finance your home and reduce your tax bill

Are you looking to buy property or finance projects for your private home? The Schwäbisch Hall home buyers saving scheme helps you save for these projects, while offering tax benefits.(4)

Other options offering tax benefits

Credit protection insurance

Have you taken out an insurance policy alongside your mortgage or consumer loan? Your premium payments are tax-deductible up to €672 per member of the tax household. Concerns Luxembourg residents and equivalent cross-border tax residents .
This ceiling applies for all eligible insurance policies and debit interest.
 

Family situation Single Married or in a civil partnership
Taxpayer EUR 672 EUR 1.344
Taxpayer + 1 child EUR 1.344 EUR 2.016
Taxpayer + 2 children EUR 2.016 EUR 2.688
Taxpayer + 3 children EUR 2.688 EUR 3.360
Per child + EUR 672 + EUR 672

Want to cover your personal mortgage loan with single-premium mortgage protection insurance? In this case, the deductible limits are higher:

  • up to the age of 30, an extra €6,000 is added, plus €1,200 per dependent child;
  • in certain cases, an additional amount is added for each year over the age of 30 (maximum deduction of €15,600 from the age of 50 for taxpayers without children).
     
Family situation Up to 30 31 to 49 50 and over
Taxpayer EUR 6.000 EUR 480year EUR 15.600
Taxpayer + 1 child EUR 7.200 EUR 576year EUR 18.720
Taxpayer + 2 children EUR 8.400 EUR 672/year EUR 21.840
Per child  EUR 9.600  EUR 768/year EUR 24.960

Deductible limits for multiple premiums and debit interest

Interest refers to the bank fees charged in the event of a negative balance on a current account, personal loan or mortgage, lasting for one or more days.
This interest may be subject to tax allowances.
You can deduct interest on current accounts and credit cards. You can also deduct interest on personal and consumer loans, such as Réserve Privilège.
Consumer loans are governed by the same article as life insurance policies (Article 109 LIR). The maximum deductible amount is €672 per person belonging to the household. This ceiling applies for all eligible insurance policies and debit interest.

Mortgage interest

Regarding your primary residence, tax allowances may range between €1,000 and €2,000 per annum and per person in the household, and according to the date of occupancy.
 

Occupancy period Deductible Amount per policyholder and er annum
1 to 5 years EUR 2.000
6 to 10 years EUR 1.500
More than 10 years EUR 1.000

However, debit interest on a secondary residence is not generally deductible.
Are you financing rental accommodation? In this case, all interest expenses are tax-deductible as acquisition costs.

(1) Deduction up to EUR 1,344 for taxpayers aged under 41 and up to EUR 672 for taxpayers aged over 41. You are advised to use saved funds linked to your primary residence. 
(2) As the tax deductibility of interest on OptiSave and OptiKids consumer loans is covered by the same article, the deductible amount cannot exceed EUR 672 (Article 109 LIR).
(3)This product from Cardif Lux Vie is distributed by its insurance agency BGL BNP Paribas.
(4) The home savings plan must have a minimum duration of 10 years and the funds resulting from the contract must be used for the purposes provided for by law.

Tax allowances are granted to Luxembourg residents and to “equivalent” non-residents.
Subject to certain conditions available at bgl.lu or in your BGL BNP Paribas branch.
Tax deductibility varies based on the personal situation of each client and is subject to change.

Frenquently asked questions

  • icone faq question Is there a minimum term for life insurance policies?

    As a general rule, in order to be able to deduct premiums from your taxes, the policy must be taken out for a minimum of 10 years.