When moving to a new country, you prepare to pay the due local taxes. However, the rules vary from one state to another. What are the specificities regarding local taxes in Luxembourg and neighboring countries? What should you consider before living or working in one of these three countries? Find all the information in this article!
Local Taxes in Luxembourg
Municipal Taxes
Both property owners and tenants are required to pay municipal taxes. The money contributed helps the proper functioning of municipalities and local authorities, which are fully autonomous legally.
The rules regarding municipal taxes vary from one municipality to another. However, generally, household resources or composition are not taken into account. These local taxes are paid in exchange for services rendered (provision of drinking water, waste management, sewage disposal, etc.).
Property Tax
Exclusively reserved for owners of built and unbuilt real estate, property tax is calculated by multiplying the assessment base by the municipal rate.
The assessment base of each property is defined by the Direct Tax Administration (ACD), which multiplies the unit value of the property by the assessment rate.
Are you looking for real estate in Luxembourg? Browse our online listings.
Local Taxes in Belgium
Municipal Taxes
Similar to Luxembourg, municipal taxes apply to all individuals living within the territory. The rate of these taxes, also called “additional municipal cents,” varies depending on the municipality where the resident resides.
The amount of this tax is based on a percentage of the personal income tax (PIT), with a rate that can range from 0 to nearly 10% depending on the city.
Real Estate
Prepayment (PRI) In addition to local taxes, property owners in Belgium pay real estate prepayment (PRI) annually. The amount of this local tax is based on the indexed cadastral income (RC).
Any person owning real estate in Belgium on January 1st of the tax year must pay this real estate prepayment. In the case of the construction of a new dwelling, payment of this tax begins the year following its commissioning.
Local Taxes in France
Residence Tax
Residence tax, required only for secondary residences, directly finances French local authorities. Its amount is based on the cadastral value of the housing and the rate voted by the community to which the taxpayer belongs.
Before January 1, 2023, residence tax was also required for primary residences. This is no longer the case in 2024: this tax has been gradually reduced and eliminated for primary residences over the years.
Residence tax is no longer required for primary residences in France, since January 1, 2023.
Property Tax
Property tax is a local tax paid by all property owners in France. This tax on built properties (TFPB) applies to owners and usufructuaries as applicable.
This tax is required from owners of a house or apartment, as well as individuals who own a parking space, a converted boat, or a commercial, industrial, or professional building.
The amount of property tax depends on a taxable base calculated based on the cadastral rental value of the property and the tax rate applicable in the local authority.
Before moving from one country to another—or even coming to work for a few months or years—make sure to thoroughly research the tax system in place and the taxes you will have to pay. This anticipation will help you avoid unpleasant surprises upon receiving the bill!
