Interest expenses

The interest expenses are deductible for :

• housing for letting
  • You can fully deduct interest expenses as an acquisition cost.
• owner-occupied dwelling
  • During the period the building remains unoccupied as the construction or conversion work proceeds, loan interest is fully deductible from taxable income as an acquisition cost.
  • As soon as the residential property is occupied, you can deduct the debit interest related to the loan as a deductible expense, taking into account the number of persons in the household and the period of occupancy.
• building plot
  • You can deduct as an acquisition cost the full amount of debt interest provided the construction work actually starts within 2 years of acquisition of the plot. Otherwise, you can partially deduct debt interest as a special expenditure to a maximum of 672€.

Source : www.logement.lu, Date : 11.04.2011, internal translation