This is a revised version of an article published in 2012, revised August 2015 and again in December 2017.
Luxembourg? That’s just a city with lots of banks right? Surprisingly that view still holds in the eyes of many. If you are moving to Luxembourg it is worth noting it’s small size, but like any other country it has a capital and yes other cities, towns and villages too! If you are moving here you can decide on city, town or country living. The capital Luxembourg is like a mini-version of any other main city being full of shops, bars and nice cafes. Other places worth checking out are Esch, Echternach, Vianden, Bettembourg and Diekirch. If you fancy a more rural life style the North of Luxembourg city offers some stunning countryside and the South-West some nice farming towns and villages. This article will focus on the tips which are based mainly on experience rather than rules.
Here are some tips and advice if you are moving here:
- Luxembourg city is small enough to get around in using public transport, you can easily get from one side to the other in under 30 minutes by bus and the newly created tram!
- For more information on available travel offers please check out the excellent mobiliteit.lu in general the base price for a monthly national ticket is €50 for all transport in the whole country.
- You must register at the local commune within 7-days of arriving
- Luxembourg is small and news travels very fast. As a result reputation is everything this “trust” aspect is also reflected in how banks operate.
- Food is certainly more expensive than Germany, France or Belgium. Comparing it to Bonn where I lived before you can add 20% or more to anything except coffee, wine and certain other items.
- You will hear Luxembourgish, French, German and Portuguese and no doubt many other languages too. English is also quite widely spoken.
- The natives I personally know prefer to speak Luxembourgish (naturally), as a second choice it seems they prefer German over French. For the rest of the population it probably varies quite widely.
- Most Government documents are in French and German, although increasingly English is available as well.
- So far most contracts I have seen have originally been in French with an English translation. However, on my bank documents atleast they clearly state the French version is the one that stands in the case of a legal dispute.
- French is most widely used in shops, bars and restaurants.
- While you can probably survive with English, although a basic knowledge of French or German makes life much easier.
- The country is extremely international.
- Luxembourg is NOT a low tax country if you are an individual, it would be fairer to describe it as a lower tax country.
- In general the tax regime is better for married couples with children; indeed this is the one area that there are many benefits.
Luxembourg is famed for it’s banking and rightfully so. If you are coming from the UK where the concept of service in banks was abolished by people such as (the artist formerly known as Sir) Fred Goodwin then be prepared for a surprise. I have heard from insiders at various banks that services have started to deteriorate (mainly due to the change of ownership of the various banks) which has led to an investor-owner rather than just owner culture which sort-of prevailed prior to 2008. That said BCEE has not changed ownership and remains one of the most secure banks in the world. To date though I have to say I have been pleased with the standard of service I have received from BGL BNP Paribas.
- Set up your bank account before you arrive, this is easily done and BGL BNP Paribas offer this service, others such as BIL and BCEE may do so as well. If you do not do this then organising your salary payments or even renting an apartment can become more difficult.
- The larger banks such as BCEE, POST, BIL and BGL have extensive cash machine networks throughout the country. Smaller ones such as ING do not, which means you end up paying if you have to use another banks ATM. Although some accounts offer a set number of free withdrawls across the EU in the basic package.
- If you prefer a co-operative type bank then you can join Raiffeisen which has branches across Luxembourg plus access to ATMs provided by POST for free. Likewise POST account holders can use Raiffeisen ATMs for free.
- In common with other countries in the EU there is now automatic exchange of bank information, this means you may be asked to provide any tax reference numbers for here or if you are a non-resident your other address. Likewise you will need to inform your non-Luxembourg bank of any tax ID number you have in Luxembourg.
- Opening accounts in other currencies is quick and simple at most banks.
- ATM fees if you use machines outside your own bank’s network can vary massively from €0.75 to €2.
- Under EU rules if you will pay the same price for using your debit card to withdraw money in any member state provided it is in Euro. The fee will be what your bank charges for using a machine which is not in their direct network (i.e. within the same bank). Some have agreements for free withdraws in Euro from other banks in the same group or with certain partners.
- Most leading banks now offer some kind of free bank accounts, these are often online only and require that you also pay in a set amount per month and/or maintain a deposit.
- Most banks let you make a set number of free transfers to other SEPA compliant banks in the EU. Post charges a small fee per transaction.
- Euro accounts are normally SEPA compliant meaning you can have one such account and pay bills (transfers, standing orders and direct debits) across border without any problem.
- You can survive easily with a Euro account from banks in other countries but sometimes certain things can only be set up or based on Luxembourg accounts. For example rental bonds. POST does not offer rental bonds, so keep this in mind if you are looking for an account.
- Many banks offer free banking for students (within certain limits).
- Setting up an account and credit cards can be done quickly and easily, credit scoring etc is increasingly being used but not to the same degree as in many other countries.
- Credit cards are paid back in full at the end of each month unless you agree another plan with the bank. There is no interest to pay if the account is settled within a few days at the start of the following month.
- If you require basic banking services only then Luxembourg Post Offer a good and quick set up service which is free. The service is however basic, it’s really an account and that is all. You do however need to pay for all transactions and any debit or credit cards. However, it can be good value for money if you need only basic services and have a low number of monthly transactions. Also note that POST offers nothing in the way of financial services or advice! They do however partner with Raiffeisen for savings accounts and occasionally there are good deals on.
If you are likely to be moving frequently between different countries, as I was for a while. Then in the longer term an international provider such as American Express (AMEX) may be a good idea. While they are often not good value for money they do allow you to bring your credit profile (and credit limit) with you between countries; even if you physically end up changing the registration country and card. Amex is not as widely accepted in Luxembourg but is in all major supermarkets and many shops. They have the advantage (unlike if you keep the card account in your home country) that you can pay directly from your Luxembourg account thus avoiding the need to remember to wire or send the cash to another country.
An additional useful service is Digicash which lets you pay bills and other items by simply scanning a QR code. You can also use it to send and receive money between friends. Many banks offer Digicash payments as a service to their customers.
Renting a Property
If you moving to the city then be prepared to experience high rents; although if you are coming from London they will appear cheap. A few tips on flat hunting:
- The main website is: www.athome.lu
- Try to look for a rental agency which is smaller and does not have hundreds of apartments. In general their standard of service is higher. I can personally recommend Bricks and Sylvie Becker – so far anyway!
- You will most likely need one months rent for the agency fee plus two months deposit. You can avoid paying in advance for the latter with a deposit bond or bank guarantee, these are sometimes offered for free when you open a bank account, otherwise expect to pay a fee per month plus an initial fee. A bank guarantee from a foreign bank is not usually accepted.
- A room in the city will set you back €600 per month or more. The university however does offer cheaper student accommodation, although this is increasingly more widely available in near the Belval campus which is not even in Luxembourg City.
- If you want more for your money check out Bonnevoie a “working class” neighbourhood which is nothing like it sounds. Pleasant, near the railway station and with shops etc.
- Parking is available in the street for free in some zones if you are a resident there, otherwise you can pay up to or more than €200 per month in addition to your rent a space.
- Look out for the communal charges which are added to your rent, these can include as little or as much as the owner likes and vary quite significantly. Always ask specifically what it includes.
- You will be required to take out and show proof of insurance when you rent a property. This will include civil liability insurance (mandatory) and you can also add on legal protection insurance which may be beneficial and often includes a free legal advice line.
Like anywhere con artists and bad service are problems in the rental sector, common problems include:
- The same apartment advertised by many agencies, not always a scam but it makes it very hard to even find out if the property exists at that agency or is still available.
- Agents will sometimes not turn up and will often not even not even bother to call you to say the apartment has gone or that they are not coming.
- Never, I repeat NEVER pay for any of the charges, fees or deposits in cash or via services such as Western Union. Always insist that all fees are paid or assigned to a bank account registered in Luxembourg.
- It is possible to rent apartments without resorting to agency fees but frankly this is more difficult and can be more risky. Although this risk can be avoided if you are moving in and already know the people from before. In general though trust your instincts.
- I am not sure if it is a legal requirement but many larger agencies try to bend the rules. Insist on the full name, real address and telephone number of the property owner. Many agencies refuse to provide the latter as a way of preventing you from getting help if something goes wrong.
- Many agencies are unresponsive, they do not answer emails even if they list that as an option. A phone call is always best, it is worth noting that some agents cannot speak English or even German.
- Even if a property is via an agency it is often the case that only one person deals with that property. If they are on holiday expect absolutely no service from that agency when it comes to viewings or help.
- You can ask for a “clause diplomatique” to be inserted into your rental contract. This means that if you have to move out of the country for work then you can cancel the agreement with three months notice. The agent will however query why you have asked for this if you have a local employer so it can be a black mark.
- Most contracts are for one year with automatic annual extensions there after, although the owner can ask you to leave if they intend to move into the property themselves.
- Property moves quickly so you do not normally get more than a couple of days to decide. However, there is usually a reasonable supply of property so don’t panic if you miss out.
- A good agent and landlord will “decide” if you are the right person to rent their property. This is also the case in many other countries, so do expect to be asked to provide documents e.g proof of employment. If they ask for nothing then I personally would be a little suspicious.
- Agents should not ask for fees to view or express an interest in an apartment. The only agency fee you should pay is when you agree to rent the apartment.
- Try to put yourself in the owners shoes and keep your proposition simple. They generally prefer an individual renting a property to two friends being on the lease as the latter shows no one person can perhaps afford the property; a problem if one moves out. Sub-letting is however in general forbidden.
- If possible pay the two months deposit/caution using the bank guarantee system or some form of held deposit at a bank. This makes it harder for the agent or owner to run off with your money.
- Outside of Luxembourg the prices fall quite a bit and you can get some excellent deals on larger houses in the North etc.
It is probably also a good idea to join the Union of Luxembourg Consumers who can provide you with early advice in the event of rental disputes. They also offer some assistance with legal costs, my understanding is that they can offer cheaper advice from a lawyer. The membership fee is very low and probably worth it in the long term.
Telecom and Internet
Such services are more costly than in many countries, in general mobile contracts from POST, Tango, Orange and JOIN all seem far less advantageous than what customers receive in the surrounding countries.
Roaming charges have been abolished since the first draft of this article was written, as a result your data and call costs should be the same in all EU countries. However, I have heard from some people that certain providers have strange tariff structures and you may end up hitting limits and certain calls/data usage levels being classed out of your basic plan, thus incurring a large fee. So far I have only heard this from people with phones registered outside of Luxembourg.
Home phones provision and Internet is also much more expensive, although to date I have been with POST (probably the most expensive of all three) but the quality of service has been excellent so you probably get what you pay for. There is increasing competition in the market with others such as Eltrona and SFR offering highly competitive deals.
I am not a legal expert but in general in Luxembourg you have two types of employment contract a CDD (fixed term contract e.g. 1 year) and a CDI (permanent contract). In Luxembourg under the CDD system there is a maximum number of years you can have the position (including any extensions), this is usually 2 or 5 years depending on the type of employment and employer. Furthermore, there is a maximum number of renewals or extensions that you can have. CDD contracts are generally for the duration so firing someone during the term is very difficult, in contrast CDI contracts often come with a specific notice period; which arguably makes sacking easier. I would urge anyone moving here to check with a lawyer or trade union if you have any specific queries.
There are trade unions in Luxembourg, the two I know of (there may be others) are:
Joining a union may be beneficial and they are often represented inside each company or organisation’s “staff delegation”. There may also be some other smaller benefits such as reduced insurance costs e.g. for air ambulances or complementary healthcare.
Some good points to ask your potential new employer about include:
- If you are being offered a temporary contract, what are the legal limits on renewals and total duration? Also check the job description you are signing up to not just the contract. Its probably safer to assume it is for the time stated, so do not bank of getting it renewed.
- Does your employer offer discounted or annual public transport tickets? This is becoming increasingly popular.
- What parking is available and what is the cost? This can vary significantly (even with the same employer) and can be free to €80 per month.
- Does your employer offer either a discounted or include complementary medical, dental or optical insurance?
- If you are working in Luxembourg but living in a surrounding country, you should check any rules regarding taxation etc as they are quite specific, especially regarding work travel (outside of Luxembourg).
Salaried staff should have all income tax, social insurance and other mandatory deductions deducted at source. If you are working as a private contractor (self employed) you will need to sort that out yourself and I am not sure how that works so please refer to other websites for information. You can calculate your net salary here if you are employed: Tax Calculator
You will require a tax card and your employer can perhaps provide some advice on how to obtain one. In general you receive one by post from the tax office then give it to your employer.
The healthcare system in Luxembourg operates on the basis that you receive a bill at the end of your visit, which you must pay either there and then or within a set amount of time. You then submit this paid bill (with proof of payment) to the national health fund (CNS). Note that certain organisations operate outside of the national health fund and private options are available. The quality of medical and dental care is often high, however as a small country treatments for very rare or complex conditions may not be available locally. However, don’t panic as both the state system and/or complementary schemes may allow you to get treatment in the surrounding countries and even Switzerland.
- The state healthcare system covers most medical costs up to a certain percentage, with higher or 100% coverage being for very serious conditions.
- Dental and optical costs are often refunded but up to much lower levels than for medical care.
- The difference between what you pay and what you get back can vary significantly and complementary insurance is available and this may cover all or some of the difference. Some providers include CMCM, Foyer and LaLux.
- Complementary insurance may include some benefits like payment for a single room (in 1st class) – not that that should be a reason to get sick.
- Getting a good dentist can be problematic as some will only accept new patients if you know an existing patient.
- Some complementary plans such as CMCM also include limited holiday health insurance.
Moving to any country can seem a bit intimidating but in general the authorities in Luxembourg plus many private sector organisations make the process relatively quick, simple and pleasant. Luxembourg is very international so it is geared towards the immigrant.
Nothing in this article should be considered as an endorsement or promotion of any company, product or service. If I have missed a particular provider off a list it does not mean they are bad or indeed if they are on the list that they are any good. You should also consult a lawyer, tax consultant or union if you have any specific questions. I am not in a position to offer legal advice and hence, nothing above should be considered legally binding.