Posted on
Mortgage interest in Luxembourg: how much can you deduct for your main residence?
Homeowner in Luxembourg? Find out how much mortgage interest you can deduct from your taxes based on when your property became available.
Own your main residence, whether in Luxembourg or abroad, and paying off a mortgage?
Good news: the debit interest (intérêts débiteurs) on your loan is deductible from your taxable income. Here's the catch, though: the amount you can actually deduct doesn't just depend on what you've paid your bank. It all comes down to the availability date of your property.
1. The availability date
The availability date (date de disponibilité) of your main residence is the deciding factor when it comes to the deduction ceiling on debit interest. It's the moment your property is ready to move into, even if you don't actually unpack the boxes until later.
How is the availability date determined?
It depends on the type of purchase and the condition of the property:
1. Buying off plan (VEFA)
The availability date is the completion of works and handover of the keys. Simple as that.
2. Buying an existing property
This one depends on the state of the place and any renovations needed:
-
If the property is immediately habitable (just minor bits like a lick of paint or new flooring), the availability date is the date of purchase.
-
If the property is derelict and needs a full renovation, the availability date is the end of works, i.e. when the place is actually liveable again.
Good to know
A property is considered uninhabitable when it lacks the bare essentials: a heating system (central or standalone), basic sanitary installations, a kitchen area and a room fit for normal living and rest. In that case, the availability date is the point at which all of these are installed and the property can be occupied normally.
2. Deduction ceilings by availability date
The more recent your property, the higher the ceiling and the bigger your tax break. Here's what the current thresholds look like:
| Property availability date | Debit interest deduction ceiling |
|---|---|
| After 31/12/2023 | Full deduction |
| Between 31/12/2019 and 01/01/2024 | €4,000 |
| Between 31/12/2014 and 01/01/2020 | €3,000 |
| Before 01/01/2015 | €2,000 |
These ceilings apply per household member, and that includes your spouse and children.
Good to know
In the year you purchase the property, you can also deduct the notary fees for setting up the mortgage and the bank commission on top of the debit interest. A nice little bonus.
3. Worked examples
Example 1: couple with one child buying a property in 2025
Date of purchase: 22/04/2025
Availability date: 22/04/2025 (immediately habitable)
Debit interest in 2025: €12,000
Notary fees for the mortgage: €2,500
Bank commission: €1,500
Tax deduction calculation:
Applicable ceiling: Full deduction (availability after 31/12/2023)
Total deductible expenses:
Debit interest: €12,000
Notary fees: €2,500
Bank commission: €1,500
Total deductible in 2025: €16,000
Thanks to this measure, the couple can deduct the full €16,000.
Example 2: couple with one child who bought in 2022
Date of purchase: 01/08/2022
Availability date: 01/08/2022 (immediately habitable)
Debit interest in 2025: €10,000
Tax deduction calculation:
Applicable ceiling: €4,000 per person (availability between 31/12/2019 and 01/01/2024)
Total deductible amount:
Ceiling per person: €4,000
Household of 3 (couple + 1 child) → €4,000 × 3 = €12,000
Debit interest in 2025: €10,000
Since the total debit interest (€10,000) is below the permitted ceiling (€12,000), the couple can deduct the full €10,000.
