{"id":13339,"date":"2021-03-22T10:48:18","date_gmt":"2021-03-22T09:48:18","guid":{"rendered":"https:\/\/www.athome.lu\/blog\/?p=13339"},"modified":"2022-05-11T11:08:21","modified_gmt":"2022-05-11T09:08:21","slug":"deduct-real-estate-interests-from-the-tax-declaration-in-luxembourg","status":"publish","type":"post","link":"https:\/\/www.athome.lu\/blog\/en\/acheter\/fiscalite\/deduisez-les-interets-immobiliers-de-la-declaration-dimpot-au-luxembourg\/","title":{"rendered":"Deduct property interest from your Luxembourg tax return!"},"content":{"rendered":"

The interest on a mortgage<\/strong> of your Luxembourg tax return can be deducted<\/strong>. The deductible amount may vary depending on the situation, whether the building is already occupied by the owner or not.<\/span><\/p>\n\n\n\n

Indeed, if the building is not not yet occupied<\/strong>the property interest may be fully deductible<\/strong> from the tax return until the taxpayer moves into the home.<\/span><\/p>\n\n\n\n

On the other hand, the deduction of property interest becomes capped<\/strong> if the building is occupied by the taxpayer.<\/strong> These are determined according to the date of occupation of the building.<\/span><\/p>\n\n\n\n

Thus, the following limits apply to the tax return in Luxembourg since 2017:<\/span><\/p>\n\n\n\n

During the year of occupancy<\/strong> then for the 5 subsequent years<\/strong>the property interest may be deducted up to \u20ac2,000.<\/strong> The Next 5 years<\/strong>you can deduct 1,500 from the tax return<\/strong> then, thereafter, 1000\u20ac of real estate interest liabilities<\/strong> will be deductible.<\/span><\/p>\n\n\n\n

For each person in the household, the ceiling will be increased<\/strong> by its own amount.<\/span><\/p>\n\n\n\n

In order to better understand, we propose two examples:<\/span><\/p>\n\n\n\n

Example 1:<\/strong><\/span><\/h3>\n\n\n\n

On 6 May 2017, two spouses bought a detached house with their two children who were still minors. They took out a mortgage to finance their house on 6 May 2017, which resulted in an interest charge of \u20ac9500. Since that day, they have occupied their house.<\/span><\/p>\n\n\n\n

In this case, the maximum deductible property interest will be : 4 x 2000\u20ac = 8000\u20ac<\/strong>.<\/span><\/p>\n\n\n\n

Example 2:<\/strong><\/span><\/h3>\n\n\n\n

A family of 3 takes out a loan at the beginning of 2020 to finance their house. This loan generates interest of \u20ac14,000. The family moves into their newly built house on 30 June 2020.<\/span><\/p>\n\n\n\n

Thus the deductible property interest: \u20ac12,980.83 (\u20ac6,980.83 + \u20ac6,000)<\/strong><\/span><\/p>\n\n\n\n