ACCESS LUXEMBOURG

WORKING IN LUXEMBOURG

The most transparent, accurate and reliable contract management company in the market.

Tenebras Sàrl (Tenebras) is a part of the Access Financial International group, one of the largest European management companies based in Europe. It is a registered employer in Luxembourg. Our local accountants, tax advisors and immigration specialists take care of our local payroll and tax in Luxembourg.

Choosing to work in Luxembourg comes with many benefits – it has a safe and stable socio-economic environment, high earnings with relatively low taxes and is ideal for family life. However, with those benefits come questions to which you will need answers so that you can find the best payroll solution for your work in this country.

WORKING IN LUXEMBOURG

The most transparent, accurate and reliable contract management company in the market.

Tenebras Sàrl, as part of the Access Financial International group, the largest European management company based in Europe. It is a registered employer in Luxembourg and looks after Luxembourg market with our local accountants, tax advisors and immigration specialists.

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Choosing to work in Luxembourg comes with many benefits – it has a safe and stable socio-economic environment, high earnings and is ideal for family life. However, with those benefits come questions that need to be answered so that you can find the best solution for your work in this country.

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KEY FEATURES

tax-compliant payroll solutions in Luxembourg

Our tax-compliant payroll solutions in Luxembourg

We offer three solutions in Luxembourg covering all the legal options possible. The most suitable one for you will depend on your circumstances, your preferences for a solution and the preferences of the recruitment business and its clients. Our is a consultative approach so we do not try to shoehorn a contractor into a single structure. We work very hard to match the solution to the contractor.

In this table we contrast and compare the solutions that we have.

Solution Self-employed Employed PSC
Eligibility EU/ EEA national with an
address in Luxembourg
All nationals EU/ EEA nationals
Work permits n/a Our Luxembourgish company Tenebras Sarl can sponsor work permits for non -EU/ EEA nationals, the administration will need approximately 1-3 months to process the application n/a
Taxes Please see table 1 Please see table 1 Please see table 1
Social security Total social security contribution rate varies from 24.41% to 25.48% Please see table 2 Please see table 2
Registrations in Luxembourg Business license, town hall, tax and social security* tax and social security tax and social security*
Features • A self-employed contractor may claim various business expenses which reduce the tax charge
• Tenebras Sàrl will apply for the trading license on behalf of the contractor
• Taxes are paid quarterly in advance during the year based on the tax due in the last assessed year (in the first year a self-assessment is made to calculate and pay taxes)
• The contractor is employed by Tenebras Sàrl (the Employer)
• The Employer runs a payroll and deducts the necessary tax and social security costs
• Tenebras Sàrl can sponsor the work permits if required
• Our company, Access Tax and Accounting Ltd (ATA), a firm of Chartered Accountants (ICAEW), together with our network of associate experts in Luxembourgish tax and social security requirements, will ensure compliance with all foreign and local tax laws.
• ATA will register the contractor’s Personal Services Company (PSC) as a temporary foreign employer in Luxembourg.
• ATA will also register the contractor in Luxembourg as a director and an employee of the company.
Benefits • Higher retention due to the possibility to deduct the entire social security contributions and relevant business expenses
• Flexibility in choosing own working hours and place; possibility of holding simultaneous contracts
• Social security contributions may be reduced by obtaining an A1 in the contractor’s home country
• Open to non-EU/EEA nationals and non-graduates
• Eligibility for unemployment benefits
• Attractive to lenders
• Higher net retention
• ATA is expert in Luxembourgish payroll and tax
• Differentiation between corporate and personal income
Complexity Moderate Least More
Net income retention % 61% (±7%) 56% (±6%) 65% (±10%)

*Unless an A1 can be obtained from another EU country.

Table 1: Tax rates in Luxembourg for 2020

Annual income (Euro) Tax rates (%)
Up to 11,265 0
11,265-13,137 8
13,138-15,009 9
15,010-16,881 10
16,882- 18,753 11
18,754-20,625 12
20,626-22,569 14
22,570-24,513 16
24,514-26,457 18
26,458-28,401 20
28,402-30,345 22
30,346-32,289 24
32,290-34,233 26
34,234-36,177 28
36,178-38,121 30
38,122-40,065 32
40,066 – 42,009 34
42,010-43,953 36
43,954-45,897 38
45,898-100,002 39
100,003-150,000 40
150,001-200,004 41
Over 200,004 42

 

Table 2: Social charges for 2020

Rate of Employer’s Contribution Rate of Employee’s Contribution
Pension Insurance: 8% Pension Insurance: 8%
Health Insurance:   3.05% Health Insurance: 3.05%
Accident Insurance: 0.9% Dependency Insurance: 1.40%
Mutual Health Insurance: 0.41%-2.79%  
Health at Work: 0.11%  

BENEFITS

15 years' experience

Fluent Dutch, French, and German speaking staff at your disposal

The only company with a comprehensive online net take home pay calculator

Most competitive fees in the market

Expert in local tax and labour law

No early termination fees

Strict adherence to local law keeps all the parties free of breaches of compliance

Online portal to provide real-time information on compliance status