When a property is passed on through inheritance, several specific rules apply in Luxembourg. From the role of the notary to the distribution among heirs, inheritance taxes and practical procedures, it is essential to anticipate to avoid unpleasant surprises.

The central role of the notary

In Luxembourg, the notary plays a key role in any inheritance. They draw up the estate inventory, verify the legal or testamentary devolution, and assist heirs with the required steps, including filing the inheritance declaration with the tax administration. Consulting a notary in advance helps to prepare the succession and limit conflicts between heirs. A notary may also propose optimisation solutions, such as an early donation, to reduce costs and simplify the transfer process.

How inheritance is shared among heirs

Luxembourg law provides for a reserved portion: certain heirs, such as children, cannot be completely excluded from the inheritance. In the absence of a will, devolution follows the legal order: descendants come first (with special rights for the surviving spouse), followed by ascendants, collateral relatives and, finally, the State if no heirs exist. Drafting a clear will remains the best way to express one’s wishes and avoid disputes. Without it, inheritances may drag on, since each heir must approve any decision concerning the property.

Inheritance tax depending on family ties

In Luxembourg, a distinction is made between inheritance tax (when the deceased resided in Luxembourg) and death transfer tax (when a property located in Luxembourg belonged to a non-resident). In many cases, transfers in direct line are exempt within the limits of the legal share, while transfers between spouses and between registered partners (registered for at least 3 years) are fully exempt. In other cases, taxes apply depending on the degree of kinship, with base rates up to 15%, plus surcharges depending on the value of the share, which can raise the effective rate above 15%. The calculation is based on the net value of the estate, after deducting debts and expenses. Detailed official tax brackets can be consulted on guichet.lu.

Specific features of real estate inheritance

When a property is inherited, it is often transferred in joint ownership, meaning each heir owns a share. Any important decision (sale, rental, buyout of shares) requires the agreement of all heirs and the intervention of a notary. To avoid deadlock, it is advisable to discuss the future of the property in advance and formalise a family agreement. In some cases, the creation of a Real Estate Civil Company (SCI) can also facilitate the collective management and transfer of a property among several heirs.

Practical steps and deadlines

The inheritance declaration must be filed within legal deadlines: 6 months if the death occurred in Luxembourg, 8 months in another European country, 12 months in America and 24 months elsewhere. Even when no tax is due, the declaration remains mandatory. If the inheritance is exempt (for example, in direct line or between spouses), the administration may issue a certificate of exemption confirming the absence of taxation.

Cross-border inheritance

In binational families or when assets are located in several European countries, Regulation (EU) No 650/2012 provides a practical tool: the European Certificate of Succession (ECS). This document, recognised in Luxembourg and most EU Member States, allows heirs to prove their rights without having to engage in multiple local procedures. In practice, the Luxembourg notary is the main contact for initiating this process and ensuring recognition of inheritance rights across borders.

In short, inheriting property in Luxembourg requires the involvement of a notary, compliance with the reserved portion rules, knowledge of possible exemptions and attention to applicable tax brackets. Planning ahead, drafting a will and staying informed about procedures will help manage this important step smoothly, even when assets or heirs are located abroad.