Is there a legal obligation to pay salaries in the same month in Luxembourg?

There is no legal obligation to pay salaries in the same month in Luxembourg.

How many salary payments are made per year in Luxembourg?

In Luxembourg, per the employment agreement template, the employee may receive their salary 12 or 13 times a year.

Should the employment agreement specify salary in monthly or annual amounts in Luxembourg?

Employment agreements in Luxembourg can specify the salary either in monthly or annual amounts. However, it is important to indicate the number of installments, such as 12 if there is no obligation to pay a 13th month.

What tax and social security obligations do employees have in Luxembourg?

In Luxembourg, employers and employees have specific tax and social security obligations.

Taxable income for employees typically includes all monetary and non-monetary benefits provided by the employer such as:

• Salaries
• Wages
• Bonuses
• Royalties
• Subsistence allowances
• Unemployment benefits
• Sickness and maternity benefits paid in lieu of salaries.

Overtime pay is generally exempt from income tax and social security deductions.

Employees in Luxembourg are required to make social security contributions as follows:

• 3.05% for health insurance
• 8% for pensions
• 1.4% for long-term care insurance.

Personal income tax rates for employees in Luxembourg are progressive, ranging from 8% to 42%.

What is the minimum wage information in Luxembourg?

Effective May 1, 2025, the minimum wage for supported employees in Luxembourg increases to EUR 968.04. This is part of a statutory 2.5% salary increase.