Crédit d’Impôt Conjoncture (CIC)

This CIC corresponds to approximatively two index levels, equivalent to 5%.

It will be calculated as follows:

This tax credit is temporary and will disappear on 1st January 2024, when a new and more favorable personal income tax scale comes into effect.

European social security regulation: framework agreement

As a reminder, the social security agreements (temporary provisions) which allowed unlimited teleworking without affecting the employee's affiliation to the Luxembourgish social security ended on 30 June 2023.

The temporary provisions had been adopted in response to teleworking triggered by the Covid-19 pandemic. Cross-border employees could work more than 25% of their working hours in their country of residence, with no consequence on their Luxembourgish affiliation. To further promote teleworking, negotiations between European countries have resulted in a framework agreement taking effect on 1st July 2023. Under this agreement, there is now a threshold of 49% as long as the following conditions are met :

• teleworking is performed exclusively in the employee's country of residence;
• teleworking in the employee's country of residence is between 25% and less than 50% of the employee's working time;
• the employee has only one employer, or his various employers are all based in the same country;
• the countries involved are two signatory states of the framework agreement (the employee's country of residence and the country where his employer is based).

From 1st July 2023, employers will be responsible for reporting teleworking within the scope of the framework agreement via the platform (https://teletravail.CCSS.lu/), which can be accessed with an activation token.

To date, the tax tolerance thresholds that apply to cross-border workers remain unchanged:

• 34 days for France
• 34 days for Belgium
• 19 days for Germany (34 days from January 1, 2024)

Unlike the rule set out above for social security, all days worked outside Luxembourg are considered when calculating tax thresholds.

The management of tokens and teleworking statements can be done by Grant Thornton. We invite you to contact us to find out how our services can meet your needs.

Lunch vouchers

From 1st January 2024, the maximum face value of lunch vouchers may be increased. It will rise from €10.80 to €15, with no change in the employee's personal contribution. It will be up to the employer to decide whether to increase the value of the lunch voucher.

To reduce the administrative burden for both companies and employees, it should also be noted that lunch vouchers will be fully digitized.

The rules for use will be modified and clarified later (ceiling, purchase category, etc.).

Abolition of 100% reimbursements from the Employers' Mutual Insurance for absences due to COVID-19

The Employers' Mutual Insurance (Mutualité des employeurs – MDE) amended its Articles of Association by the Act of 24 March 2023, resulting in the end of the 100% reimbursements for COVID-19-related sick leaves. From April 2023, reimbursements will be reduced to 80%, in line with other sick leaves. However, the 100% reimbursements will be maintained for retroactive calculations up to and including March 2023.

Contact

Any questions? Please contact our experts at the following email address: HRpayroll@lu.gt.com.