Tax on profit or loss
Tax on the company's profit: corporate income tax, the employment fund contribution and the municipal business tax together.
A Luxembourg company is taxed on the profit it earns, in the year it earns it. This line brings together three charges: corporate income tax (impôt sur le revenu des collectivités), the employment fund contribution levied on it, and the municipal business tax (impôt commercial communal).
The municipal business tax is set by the commune, so the combined rate is not the same everywhere in the country. Two otherwise identical companies can carry different effective rates because they are established in different communes.
A profitable company can also report little or no tax: carried-forward losses, the participation exemption on income from qualifying holdings, or tax credits. Read this line beside the result, not instead of it.
Where this figure comes from
Read from the “Tax on profit or loss” line of the filed profit and loss account.
Related terms