VAT invoicing rules in Luxembourg: rates, franchise limit and invoice content

VAT rates in Luxembourg

Luxembourg applies four VAT rates:

• 17% is the normal rate. It covers all taxable supplies that do not fall under another rate.
• 14% is the intermediate rate. It covers goods and services listed in Annex C of the VAT Law of 12 February 1979.
• 8% is the reduced rate. It covers goods and services listed in Annex A of the same law.
• 3% is the super-reduced rate. It covers goods and services listed in Annex B.

The official portal lists the rates but does not give the goods in each category. Check the annex for each product before you set the rate in your system.

Registration and the franchise limit

Luxembourg has a VAT franchise for small businesses. If your annual turnover excluding VAT does not exceed EUR 50,000 in a calendar year, you are exempt from charging VAT. You must still report your turnover to the administration. Above that level, you register and charge VAT at the applicable rate.

What a VAT invoice must show

For invoices above EUR 100 including VAT, include these nine elements:

1. The issue date.
2. A sequential number that uniquely identifies the invoice.
3. The supplier's VAT identification number.
4. The full name and address of the supplier and of the customer.
5. The delivery or service date, or the advance payment date, if it differs from the issue date.
6. The quantity and nature of the goods, or the extent and nature of the services.
7. The price excluding VAT, broken down by rate if more than one rate applies.
8. The VAT rate and the VAT amount, broken down by rate if more than one rate applies.
9. The reason the transaction is not subject to VAT, where that applies.

Invoices of EUR 100 or less, including VAT, for domestic supplies need a shorter set of items. Intra-EU invoices and reverse-charge invoices need additional wording, such as "Autoliquidation" for reverse charge.

When VAT becomes due

For a supply to a taxable person or a non-taxable legal entity, the tax becomes due by the 15th day of the month after the month in which the taxable transaction took place.

Record retention

Keep copies of the invoices you issue, and all invoices you receive, for 10 years from the issue date.

Next step

See the developer documentation to map these fields into your invoice model.