Personal taxation · Luxembourg
Deductible donations in Luxembourg: rules and receipts
A donation is deductible only if it falls within the approved organisations and payments. The annual total must in particular reach EUR 120, with a limit of 20% of total net income and EUR 1,000,000. Excess amounts may qualify for a conditional carry-forward over the following two years.
Financial Services Luxembourg · Licensed accountant · Head of the firm: Mickaël LOC. Editorial update: .
The organisation and the payment
Non-profit status or a public-interest cause is not enough to establish tax eligibility. Check the organisation, its approval or qualification and the nature of the payment. For a foreign donation, the analysis must cover the corresponding conditions.
A membership fee, a purchased service and a donation are not necessarily treated in the same way. The certificate must make it possible to identify the part actually concerned.
Track the ceiling and carry-forwards
The limits are assessed over the year and on the total of approved donations, not separately for each receipt. An amount exceeding the limit is not automatically deductible straight away.
Tracking carry-forwards must separate the year of origin, the amount already used and the remaining period. Holding an old receipt is not enough to prove that a carry-forward is still available.
Fictitious example
Two eligible donations of EUR 70 total EUR 140 and may satisfy the annual minimum, subject to the other rules. On the other hand, a single payment of EUR 100 should not be presented as automatically deductible because the recipient is approved.
The effect of a donation on tax does not turn the transaction into a financial gain: the donor bears a net cost and does not recover the full donation through tax.
Records to keep
- Receipt and proof of payment.
- Identification and tax qualification of the recipient.
- Annual statement of all donations and carry-forwards.
- Calculation of the limits according to the return for the year.
The firm’s other tax engagements
Depending on your situation, the firm also handles tax, VAT and payroll, the regularisation of late tax filings and assistance during a tax audit. Fees are listed in the firm’s fee grid.
Official sources and scope
The rules apply to the year and profile concerned. Examples flagged as fictitious explain a method; they are not an individual validation. The documents and options of your file are covered by a separate engagement.