Widowed, divorced or separated: how you are taxed in Luxembourg from 2028

The short answer

From tax year 2028, Class U taxes everyone on their own income. For people whose marriage ends, the reform keeps a softer landing. New article 118bis of the income tax law, as adopted on 28 October 2026, puts three groups on Tarif T, the transitional joint scale with bands twice as wide: couples taxed jointly, widowed people whose marriage ended by death in the five years before the tax year, and divorced or separated people whose divorce or separation happened in the five years before the tax year. Both of the last two groups can opt for Class U during that period. Tarif T itself ends with the 2052 tax year.

Today the same protection is class 2 for three years. Five years instead of three is the main change; the bigger one comes when the period ends, because the next stop is Class U, not class 1a.

After the death of a spouse

Under article 118bis, paragraph 2, letter b), a widowed person is taxed on Tarif T if:

• the marriage was dissolved by death in the five years before the tax year, and
• the couple was taxed jointly in the tax year before the year of the death, and
• the spouses had not opted for Class U in the year of the death.

During those five years the widowed person can opt for Class U, using the same procedure as couples (article 3bis, paragraph 2). That procedure is irrevocable for couples; on our reading the same applies here, so check before filing. For the years before 2028, article 60 says residents are treated as taxed jointly in 2027 for this rule.

After a divorce or a separation

Letter c) covers people who are divorced, legally separated (séparation de corps) or separated in fact under a dispensation of the law or a court authorisation in the five years before the tax year. The conditions mirror the widowed rule, with one extra:

• the couple was taxed jointly in the tax year before the divorce, the separation or the interim court order (ordonnance de référé) allowing the spouses to live apart;
• the spouses had not opted for Class U in that year;
• the person has not used this transition in the five years before, so it cannot be chained from one marriage to the next.

The text adds that a divorce judgment by mutual consent counts as an authorisation to live apart. It does not mention spouses who simply move out without a court decision. Our reading is that they still count as spouses for tax purposes, since the definition of spouses in new article 3 excludes only those separated under a legal dispensation or a court authorisation. If that is your case, ask the ACD how your year will be treated.

Which years: a quick table

On our reading of article 118bis and article 60, an event in a given year gives Tarif T for the five following tax years, with class 2 standing in for Tarif T until 2027 and nothing beyond 2052. For people whose three-year class 2 period ends with tax year 2026, article 60 excludes the new rule: class 1a in 2027, Class U in 2028.

Two points are our inference rather than the text's words: that the five years are counted from the year after the event, and that joint taxation under today's rules before 2027 satisfies the "taxed jointly the year before" condition. Article 60 spells it out only for 2027. Our class 1a guide reads the rule the same way.

Who goes straight to Class U

• Registered partners (PACS). Article 3ter, paragraph 2, extends the joint-taxation rules to PACS partners except, among others, article 118bis, paragraph 2, letters b) and c). On our reading, a surviving or separated PACS partner does not get the five years and is taxed on Class U.
• Couples already on Class U. The rule requires joint taxation in the year before the event. A couple that opted for individual taxation earlier, or in the year of the event, does not qualify.
• Couples married from 1 January 2028. They are taxed on Class U from the start, so a later divorce changes nothing to their scale.
• Divorced people who used the transition in the previous five years, and those caught by article 60 (class 2 period ending in 2026).

What the five years are worth

Tarif T taxes one income with bands twice as wide, so on its own it is far cheaper than Class U. Using the calculator's formulas (surcharge included, before tax credits):

At €60,000 the gap is €5,150 a year; at €100,000 it is €10,410. That is also the step to plan for when the five years end. The full rate tables are in our Class U tax brackets guide.

Single parents: when switching early can pay

For a parent whose child lives with them, the choice is less obvious. Two advantages exist only on Class U in the voted text: the single-parent tax credit (article 154ter grants it to a person "taxed under article 118", neither married nor in a PACS) of €4,008 below €60,000 of adjusted taxable income, and the €5,400 early-childhood allowance per child under three (granted to a taxpayer "taxed under the scale of article 118"). On Tarif T you get neither.

Examples for a parent who alone receives the child tax reduction, with no alternating residence:

• €50,000, child aged three or more: €2,583 on Tarif T, against €5,255 − €4,008 = €1,247 on Class U. Class U is €1,336 a year cheaper.
• €60,000, child aged three or more: €4,278 on Tarif T, against €9,428 − €4,008 = €5,420 on Class U. Tarif T is €1,142 a year cheaper.
• €60,000, child under three: the allowance brings Class U to €7,175 − €4,008 = €3,167, so Class U is €1,111 a year cheaper.

The single-parent credit is not granted when the child lives alternately with both parents, and the allowance is then halved. Because opting for Class U cannot be undone, compare the whole remaining period, not only this year: a child turning three removes the allowance, and a raise past €60,000 shrinks the credit. To check your own figures, enter your income with 0 for a second earner in the Class U vs Tarif T calculator, then subtract the credit from the Class U result yourself: the calculator is built for couples and does not apply it.

Children, maintenance and alternating residence

Separated parents who share a child under alternating residence share the child tax reduction (article 122, paragraph 2e). The single-parent credit is excluded in that case, and so is the deduction for a child living outside your household. That deduction's ceiling rises from €5,424 to €5,928 a year. Details for single parents are in our class 1a guide.

Cross-border workers

The five-year rule is not limited to residents. Article 157bis, paragraph 4, as amended, puts non-residents with Luxembourg professional income who are in the widowed or divorced situations of article 118bis on Tarif T during the transition. The other conditions, including joint taxation in the year before, still apply. Our cross-border workers guide covers assimilation.

What to do now

1. Note the year of the death, divorce, separation or court order; it fixes your five-year window.
2. Check that you were taxed jointly the year before (your tax assessment says so).
3. If you have a child living with you, compare Tarif T with Class U plus the €4,008 credit for each remaining year before opting.
4. In a PACS, plan for Class U.
5. Wait for publication: the ACD form and practice can only follow the law.

Status of the law

Bill 8676 was adopted at the first constitutional vote on 28 October 2026 (37 for, 11 against, 12 abstentions), with a request to waive the second vote. As of 4 November 2026 it had not been published in the Journal officiel, and the parliamentary file still showed "first vote done". The rules above follow the adopted text and apply from tax year 2028. They are estimates, not tax advice.