Leaving Luxembourg

When you leave Luxembourg with a US LLC, the Grand Duchy keeps certain taxing rights, in particular over substantial holdings in Luxembourg companies and over business assets. This page is for you if you are preparing that move: when you stop being a resident taxpayer, what follows you afterwards, and the order in which to leave. The articles quoted are those of the income tax law (L.I.R.), in the coordinated text of the Administration des contributions directes in force on 1 January 2026.

Resident or non-resident

You are a resident taxpayer if you have your tax domicile or your habitual abode in the Grand Duchy. You are then taxed on both your Luxembourg and your foreign income.

If you have neither in Luxembourg, you become a non-resident taxpayer: you are taxed only on your Luxembourg-source income, as listed in article 156 L.I.R. The whole point of leaving is therefore to have neither a tax domicile nor a habitual abode in Luxembourg any more, and then to know which of your income remains Luxembourg income within the meaning of article 156.

Substantial holdings: five years after you leave

Article 156 no. 8 b) keeps taxing, after you leave, the gains on the sale of a substantial holding within the meaning of article 100, where three conditions are all met:

• the company has its registered office or central administration in Luxembourg;
• you were a resident taxpayer for more than fifteen years;
• you became a non-resident taxpayer less than five years before the gain is realised.

A holding is substantial if you held, alone or together with your spouse or partner and your minor children, directly or indirectly, more than 10 % of the company's capital at any time during the five years before the sale. The taxable income is the sale price, less the costs of sale and the acquisition price.

Article 100 covers sales made more than six months after acquisition. A quicker sale falls under a different rule: article 156 no. 8 a) also taxes a non-resident on the gain from a substantial holding in a Luxembourg company realised within six months of acquisition.

Nos. 8 a) and 8 b) do not cover sales of holdings in a collective investment undertaking in corporate form, in an investment company in risk capital (SICAR) or in a family wealth management company (SPF).

This rule targets Luxembourg companies. It matters to you if, alongside your LLC, you hold such a company from your time as a Luxembourg resident.

Business assets: taxed when you leave

Holdings that form part of the net invested assets of a commercial business or of an agricultural or forestry operation, or that are used to carry on a liberal profession, do not fall under article 100: they follow the rules for business profits.

For these assets, article 38 L.I.R. treats the transfer of your tax domicile or habitual abode to another state as a disposal. This applies to a sole proprietorship, a permanent establishment or individual items of the net invested assets. The sale price used is the estimated realisation value at the time of the transfer. The only exception is for assets that remain effectively attached to a Luxembourg permanent establishment and whose book values are carried forward.

Leaving in the right order

What goes wrong when a step is missed

• You keep a tax domicile or a habitual abode in Luxembourg: you remain a resident taxpayer, taxed on your worldwide income.
• You sell a substantial holding in a Luxembourg company less than five years after you leave, after more than fifteen years of residence: the gain remains taxable in Luxembourg.
• You sell a substantial holding in a Luxembourg company within six months of acquiring it: the gain is taxable in Luxembourg even though you have become a non-resident.
• You leave with a sole proprietorship or business assets without attaching them to a Luxembourg permanent establishment: the departure counts as a disposal at the estimated realisation value.

Leaving another French-speaking country? See Leaving France and Leaving Belgium.

Sources

Checked 26 October 2026. The Administration des contributions directes states that its coordinated text is not an official text.

• Loi modifiée du 4 décembre 1967 concernant l'impôt sur le revenu (L.I.R.), art. 2, 38, 100 and 156, ACD coordinated text in force on 1 January 2026, updated 8 May 2026: impotsdirects.public.lu
• Guichet.lu, "Déclaration d'un déménagement à la commune de résidence": guichet.public.lu

Your own case

This page is general information, not advice on your case. Your own situation is checked in a consultation, held in English.