Cross-border workers: Yes, Luxembourg's 2028 tax reform applies to you

Cross-border workers are included in Luxembourg's 2028 tax reform. Here's what changes for frontaliers from Belgium, France, and Germany.

With over 200,000 cross-border workers (frontaliers) commuting into Luxembourg daily, the question was inevitable: does the new tax reform apply to frontaliers?

The answer is yes. Explicitly yes.

What's changing

From January 2028, Luxembourg's three tax classes (1, 1a, and 2) merge into a single unified 'Classe U'. This applies to everyone taxed in Luxembourg, residents and non-residents alike.

For frontaliers currently in Class 1 (single, no children), this means significant savings:

• €50,000 income: +€2,600 net per year
• €75,000 income: +€2,517 net per year
• €100,000 income: +€2,518 net per year

For frontaliers in Class 2, around 85% will also pay less. Those where one spouse earns more than 75% of household income can keep their current treatment for up to 25 years.

The family benefits

The new €5,400 "petite enfance" deduction (€450/month) for children under 3 applies to frontaliers. So does the increased single-parent tax credit (up from €3,504 to €4,008).

You can also benefit from the higher deduction limits:

• Insurance & loan interest: €672 → €900
• Home savings: up to €1,500 (ages 18-40)
• Childcare/dependency care allowance: €5,400 → €6,000

Note: Some other announced measures (like family allowance increases and CSA childcare subsidies) are separate from the tax reform and may have different eligibility rules based on residence.

What to do now

Nothing changes until 2028. Your 2025, 2026, and 2027 tax returns use the current system.