Q & A

Last week, a member reached out to us with the following question:

I have enrolled in a two-year online, part-time master’s program relevant to my field, and I have some questions regarding the deductibility of costs and tuition fees for tax and VAT purposes.
I’ve contacted my accountant, but he has been very busy and has not yet responded despite my reminders. Before considering changing accountants, could you or someone on your team provide guidance based on your experience or direct me to a reliable information source? My French is limited, but I can translate if I know the source is trustworthy.
Specifically, my questions relate to income tax and deductible expenses for independent professionals in Luxembourg:
Is the master's program, which is relevant to my current field and services, considered a deductible expense? If so, is there a limit on the amount of educational expenses (such as tuition fees) that I can deduct annually or per program for income tax and VAT purposes?
Does the payment method (upfront payment versus installments) affect the timing or amount of deductions I can claim each year?
I would appreciate your advice on which payment option would be more financially advantageous from a tax perspective.

Our response:
If the master’s program is directly related to your current professional activity — meaning it enhances your skills in your existing field rather than preparing you for a different profession — then the tuition fees are fully deductible as professional expenses for income tax purposes in Luxembourg. Importantly, there is no cap on the amount you can deduct.

Regarding the timing of deductions:
If your accounting is prepared on a cash basis, you deduct expenses in the year you make the payment. Therefore, if you pay in installments, the portion paid in 2025 will be deductible in 2025, and installments paid in 2026 will be deductible in 2026.
If your accounting follows an accrual basis, the expense is deductible in the year the invoice is issued, regardless of when the payment is made.
We recommend confirming your accounting method with your accountant to ensure proper treatment.

Recently, one of our long-standing members, a marketing consultant with over 30 years of experience, reached out to us with a concern regarding her business status. She discovered that she neither holds a Business Permit (Autorisation d’établissement) nor is registered with the Registre de Commerce et des Sociétés (RCS).

Member’s question:
"This was never done when I started my activity 31 years ago — an oversight by my former accountant who has since retired. I’m unsure how to regularize this situation. I’ve tried before, but it’s hard to believe that I have a VAT number without being formally registered. What can I do?"

Our advice:
To obtain the Business Permit (Autorisation d’établissement), you will need to complete the current official registration procedure, even though you have been active for many years. This means formalizing your status according to today’s legal requirements. The process is generally straightforward, especially since you hold a diploma in your field. However, please note that the authorities do not take prior years of activity into account when issuing the permit.

You can find detailed information and begin the formalities via the official portal; the following link will guide you to MyGuichet, where all the necessary steps are outlined: https://lnkd.in/eUhfaCDu

Regarding registration with the Registre de Commerce et des Sociétés (RCS), please note that it is not mandatory for intellectual professions like consultants. The RCS registration is required primarily for commercial traders (commerçants) involved in the buying and selling of goods.

Question:
Since I started my business I’ve been exempt from paying social contributions because I predicted earning less than 1/3 of the social minimum wage in the first few months. My concern is having too many months where I am not contributing to my pension as this will impact me in the future. My clients are growing and I am increasing my income slowly but not as much as min wage yet. I am considering to start making contributions to the CCSS to avoid issues with my pension in the future. Any advice or experience from others in this situation?

Answer 1
Principle: social contributions including pension part (16%) should be paid on your income (net profit as declared in your tax report) and on at least the minimum social salary (even if you earn less)
Option 1: if you earn less than a third of the minimum social salary, you are not obliged to contribute. You still need to be registered but you can ask for an exemption.
Option 2: if you earn between 1/3 of minimum social salary and minimum social salary, you can ask to pay on your actual income. Health contributions will still be due on minimum social salary but pension contributions can be calculated on your real income.

Answer 2
You are eligible to a Luxembourg pension if you worked at least one year in Luxembourg and at least 10 years in total in Europe and/or a few other countries with which Luxembourg signed a social security agreement.if you worked x years in Luxembourg, of course you will only receive x/40 of a pension from Luxembourg.
3 scenarios:
1. If you worked at least 10 years in Luxembourg, what you earned abroad will be ignored for the calculation.
2. If you worked less than 10 years in Luxembourg but more than 10 years in Europe or the other few countries, what you earned abroad (in these countries) will be taken into consideration for the calculation.
3. ⁠If you did not work in Europe at least ten years, you will not be entitled to a pension and at the age of 65, you can claim the refund of your contributions.

Disclaimer: Each person's situation is unique, do not assume that the answers we provide to one of our members would automatically apply to you. Consult an accountant or join us to inquire about your specific situation.

Récemment, un de nos membres s’est interrogé sur la nécessité éventuelle d’obtenir une autorisation du Ministère de la Santé, en plus de celle du Ministère de l’Éducation pour ses activités professionnelles. Nous avons donc posé la question directement aux autorités compétentes, et voici la réponse que nous avons reçue :

"Nous nous permettons de revenir à votre demande concernant la demande d’autorisation de la personne diplômée en counselling thérapeutique et en thérapie CBT.

Nous vous confirmons que cette personne n‘a a priori pas besoin d’autorisation d’exercer. Cependant, nous tenons à la rendre attentive aux dispositions suivantes.

La loi modifiée du 26 mars 1992 sur l'exercice et la revalorisation de certaines professions de santé définit les professions de santé réglementées au Luxembourg pour lesquelles le ministère de la Santé et de la Sécurité sociale délivre des autorisations d’exercer. Vous trouverez les dispositions de la loi sous le lien suivant :https://lnkd.in/e6Zcze8R. La loi modifiée du 14 juillet 2015 portant création de la profession de psychothérapeute réglemente la profession de psychothérapeute : https://lnkd.in/efXb9XJr.

La profession de counselling thérapeutique n’étant pas une profession de santé réglementée, elle ne tombe pas dans le champ de compétence du ministère de la Santé et de la Sécurité sociale et ne bénéficie donc pas d’une autorisation d’exercer émise par non soins.

Cette personne pourra donc certes exercer son activité sans autorisation de la part du ministère de la Santé et de la Sécurité sociale aussi longtemps qu’elle ne pratique pas d’actes qui tombent dans le champ d’attribution d’une des professions de santé réglementée par la loi précitée, ni dans le champ d’attribution de la profession de médecin ou de psychothérapeute.

En effet, avec l’exercice d’une profession de santé non réglementée vous pouvez être amené à pratiquer des gestes, actes ou techniques qui peuvent rentrer dans le champ d’application d’une profession de santé réglementée. Sans autorisation d’exercer vous n’êtes pas autorisé à effectuer des gestes, actes ou techniques qui sont propres à une profession de santé réglementée. Dans le cas où vous pratiquez des gestes, actes ou techniques réservées à une profession de santé tel que définie dans le loi précitée sans disposer d’autorisation d’exercer valable, vous vous trouverez dans l’exercice illégal, ce qui est pénalement répréhensible."

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