New 2024 measures introduced by the government

To maintain some momentum in the Luxembourg property market, the government has introduced incentives that concern first-time buyers and investors alike.

So whether you are a buyer looking for your main residence or an investor hunting for good opportunities, these measures could help you carry out your project. Here are the available forms of support in detail.

Good news for future homeowners! The amount of the Bëllegen Akt has risen from €30,000 to €40,000 per person for 2024. This substantial increase applies solely to the purchase of a main residence and is valuable help in reducing the overall cost of buying. As there is no certainty that this amount will be carried over into 2025, now may well be the moment to take advantage of it!

The tax advantage also widens with the increase in the ceiling on deductible interest. Each member of the household can now deduct up to €4,000 a year, against €3,000 previously. For a family of four, that represents a tax saving rising from €12,000 to €16,000 a year.

What is more, the ceilings on deductible interest rise after six years to €3,000 (against €2,250) and after ten years to €2,000 (against €1,500), offering lasting benefits well beyond 2024.

If you sell your property to the Fonds du logement, you now benefit from a full exemption from capital gains tax, a significant tax relief on resale.

Investors are not left out. A new tax credit, the “Bëllegen Akt for investors”, of €20,000 per individual, has been introduced. It is intended for people buying off-plan (VEFA) as a buy-to-let investment. The condition: letting the property for at least two years.

Accelerated depreciation becomes even more attractive. The rate rises to 6% over six years for properties bought off-plan and let out. The annual ceiling on this benefit is set at €250,000, allowing a substantial tax deduction.

The tax rate on property capital gains is reduced to a quarter of the overall rate, i.e. around 10% instead of 20%. To qualify, the property must be held for at least two years.

Finally, by placing your property under social rental management, you can benefit from a 90% exemption from tax on the net income generated, an incentive designed to encourage social letting.

Experts predict that these measures could speed up the recovery of the property market. Do not miss this opportunity to benefit from favourable conditions and significant financial support.

For more information on these tax incentives, do not hesitate to consult us. 2024 is not over yet and could well be the year your property plans become reality.