Articles on: Taxes

Do Self-Employed Pay Net Wealth Tax in Luxembourg?

Short answer: no. As a self-employed person (sole trader / independant / Selbststandiger) in Luxembourg, you do not pay net wealth tax (impot sur la fortune / Vermogenssteuer). This tax was abolished for natural persons in 2006 and now only applies to companies like SARL, SARL-S, and SA.

Who you are	Do you pay net wealth tax?
Self-employed (sole proprietorship)	No
Partner in a transparent company (SENC, SCS, civil company)	No
SARL, SARL-S, SA (opaque company)	Yes
Natural person (any other income)	No

This is one more reason a sole proprietorship is cheap to run: no fixed annual tax just for existing, unlike a company.

Why self-employed don't pay net wealth tax

Luxembourg used to charge net wealth tax on natural persons — individuals who owned significant assets. That changed on 1 January 2006, when the tax was abolished for all individuals, whether resident or non-resident, and for anyone operating through a transparent structure such as a sole proprietorship, SENC (general partnership), SCS (limited partnership), or civil company (societe civile).

In tax terms, these structures are "see-through": the profit flows directly to the partners, and the partners pay only income tax on it. There is no separate entity to tax on its net assets.

This is different from income tax and CCSS. Self-employed still pay both — it's just the net wealth tax (a tax on your business's accumulated assets, not on your income) that doesn't apply.

Who still pays net wealth tax

Net wealth tax applies to opaque corporate entities, which are taxed as separate legal persons:

SARL (societe a responsabilite limitee)
SARL-S (simplified SARL)
SA (societe anonyme)
Other capital companies

These companies pay an annual net wealth tax of 0.5% on their net assets, with a minimum net wealth tax even if they have no assets or are loss-making.

Minimum net wealth tax for companies (2026)

Balance sheet total	Minimum NWT per year
Up to 350,000 EUR	535 EUR
350,001 – 2,000,000 EUR	1,605 EUR
Over 2,000,000 EUR	4,815 EUR

Even a dormant SARL with no activity pays at least 535 EUR per year in minimum net wealth tax.

A company pays whichever is higher between the ordinary net wealth tax and the minimum shown above — they are not cumulative. The minimum can also be offset by the prior year's corporate income tax (IRC + employment-fund surcharge), so a profitable SARL often doesn't actually pay it in cash. It mainly bites loss-making or low-profit companies.

Practical tip: The minimum net wealth tax is one of the fixed costs that tips the balance when comparing a sole proprietorship to a SARL. Add 535 EUR/year (at minimum) on top of notary fees, annual accounts filing, and corporate tax administration.

What if I switch to a SARL or SARL-S later?

If you incorporate your activity into a SARL or SARL-S, net wealth tax starts applying to the company, not to you personally. You as a shareholder still pay no net wealth tax on your shares or personal assets.

For a full comparison of the tax cost of each legal form, see sole proprietorship vs SARL in Luxembourg.

Quick reference

Question	Answer
Do self-employed pay net wealth tax?	No
Do SARL / SARL-S / SA pay net wealth tax?	Yes
Minimum net wealth tax for a small SARL (2026)	535 EUR/year
When was net wealth tax abolished for individuals?	1 January 2006
Legal basis	Loi modifiee du 16 octobre 1934 (loi IF); abolition for natural persons by Loi du 23 decembre 2005; 2025 simplified minimum IF by Loi du 20 decembre 2024

For more on the taxes you actually do pay as self-employed, see what taxes do self-employed people pay in Luxembourg. If you are choosing between legal forms, see which legal form for your business in Luxembourg.

Not every day is easy when you work for yourself — but every day, you're creating something that's yours. Bravo for that.
🙌💜 Your BravoLisa Team

This article is for general information purposes only and does not constitute professional tax, legal, or accounting advice. Every situation is different — consult a qualified professional (tax adviser, accountant, or lawyer) for advice specific to your circumstances. BravoLisa does not accept liability for decisions made based on this information.

Last updated: April 2026. Rates and thresholds may change — always verify with the relevant authorities for the most current figures.

Updated on: 23/04/2026

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