AOW, pension and tax in Luxembourg: everything to the country of residence, and you declare it yourself

The treaty with Luxembourg from 1968 places your occupational pension exclusively with Luxembourg, and because it has no social security article, your AOW and your annuity go the same way via the residual article. Luxembourg taxes them in a progressive scale up to 42 percent, per tax class — without withholding, so with an annual return and four advance payments. The government pension stays Dutch, even with a Luxembourg passport.

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Written and checked by Auke on 14 October 2026, against the sources at the bottom. Is something no longer right? Report it below and I'll fix it.

If you live in Luxembourg, your occupational pension, your AOW and your annuity are taxed only in Luxembourg. Luxembourg withholds nothing on them, so you declare them there yourself.

Three things to know up front:

The treaty with Luxembourg was signed in The Hague on 8 May 1968, and you notice it. It follows the old model in which the country of residence gets the pension.
What the treaty doesn't regulate is as important as what it does. It mentions social security nowhere, and precisely because of that your AOW goes to Luxembourg too.
A government pension, such as ABP, stays Dutch.

The occupational pension: to Luxembourg

Article 19: pensions and other similar remuneration paid to a resident of one of the States in consideration of past employment shall be taxable only in that State. Your occupational pension goes exclusively to Luxembourg, without threshold and without Dutch source-state tax.

For that you apply to the Dutch tax authority for the wage tax exemption, with a Luxembourg certificate of residence. Without that application your fund keeps withholding, and you only get it back after a year.

The AOW and the annuity: via the residual article, also to Luxembourg

The treaty mentions social security nowhere. Your AOW is not a pension from past employment and therefore falls under article 21, the residual article: other items of income of a resident of one of the States shall be taxable only in that State. So the same outcome: only Luxembourg taxes, and for the AOW too you apply for the wage tax exemption.

An annuity that doesn't come from employment follows the same route.

The exception: the government pension

Article 20 paragraph 1: remuneration and pensions paid by the Dutch state or a Dutch public body for services in the exercise of governmental functions may be taxed in that State. So ABP stays Dutch. And unlike in most treaties this article has no exception for whoever is a resident and a national of the other state: a Luxembourg passport changes nothing about it.

Luxembourg exempts that pension, but with progression. Article 23 paragraph 3 lets Luxembourg apply the rate that would apply if the exempted income had not been exempted. In a progressive scale your government pension therefore pushes the rest of your income up a bracket. So you declare it too, in the boxes for exempt income.

What Luxembourg does with it itself: the scale and the class

Luxembourg taxes the income of its residents in brackets. Up to € 13,230 the rate is 0 percent. After that it rises in steps, from 8 percent to 39 percent above € 54,090. The top rate is 42 percent, above € 234,870. This is the base rate from tax year 2025. On top of that comes a contribution to the employment fund.

Taxable income (base rate, class 1)	Rate
up to € 13,230	0%
€ 13,230 – € 54,090	rising from 8% to 38%, in steps of € 2,205 to € 2,295
€ 54,090 – € 117,450	39%
€ 117,450 – € 176,160	40%
€ 176,160 – € 234,870	41%
above € 234,870	42%
advance payments	10 March, 10 June, 10 September, 10 December
paying late	0.6% interest a month

Which scale you get depends on your tax class:

class 2 for a couple assessed jointly that divides the income by two;
class 1a, among others, for whoever is single and already sixty-four on 1 January of the tax year;
class 1 for the rest.

The administration publishes the scales anew every year and has a calculator.

Work it out on your own amounts before you compare with the Netherlands. The outcome depends on your class, on the size of your pension and on the exempt income that counts for the rate, and those three together can fall either way.

No withholding: return and four advance payments

Here Luxembourg differs from the Netherlands. On a pension from abroad nobody withholds anything. Luxembourg funds do, but foreign ones can't.

So you file a return every year with the Administration des contributions directes, the Luxembourg tax authority. You attach the pension statement from your fund and from the SVB; that is mandatory. You get an assessment and a settlement. After that you pay advance payments on 10 March, 10 June, 10 September and 10 December. Their amount is set on the previous assessment. Paying late costs 0.6 percent interest a month.

Set aside the first year yourself. The first assessment only comes once the year is over, and then it comes in one go.

Your accrued AOW comes along in full

Apart from the tax: the SVB pays the AOW in Luxembourg too, in euros. In a SEPA country that happens around the 24th of the month, with at most € 0.48 in bank costs per payment. Report your move to the SVB in time, with the date, your Luxembourg address and your bank details.

Your further accrual, 2% per insured year, stops on the day of deregistration. Whoever leaves before AOW age can, according to the SVB, sometimes insure voluntarily.

In Vertrekklaar this is phase 1 of 5 of the journey, step 1.2: the same steps, but for your situation — in your order, tickable, and with the deadlines watched. See the whole journey to Luxembourg or go straight to step 1.2 in the open plan.

What this means for your numbers →

What this rests on

The facts in this article come from these official pages. Rules change. When in doubt, go by the source, not this article.

Treaty Netherlands-Luxembourg for the avoidance of double taxation — wetten.overheid.nl
Guichet.lu — identifying and declaring a statutory pension from abroad — guichet.public.lu
Guichet.lu — paying the tax as a pensioner, assessment and advance payments — guichet.public.lu
Administration des contributions directes — the tax scales — impotsdirects.public.lu
Administration des contributions directes — the base rate for individuals (0 to 42%) — impotsdirects.public.lu
Administration des contributions directes — the tax classes of residents — impotsdirects.public.lu
SVB — payment of the AOW outside the Netherlands (SEPA, euros, costs) — svb.nl
SVB — how AOW accrual works (2% a year, voluntary insurance) — svb.nl

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