Plan contractor hiring in Luxembourg

A Luxembourg-resident contractor operating as a sole proprietor carries business profit as individual income without the wage-withholding flow. The first onboarding check is the authorised supplier identity. Regular commercial, craft and covered liberal-profession activities generally need an autorisation d'établissement, and the contract, invoice and payee record should identify the business that holds it. A sole proprietor registers with the CCSS and personally carries both contribution shares.

Sources: Guichet.lu, application for or modification of a business permit, Guichet.lu, sole proprietorship, Guichet.lu, social security registration for self-employed persons

If the line is crossed

If the performed relationship is employment and Luxembourg social-security law covers the work, the foreign customer becomes the employer-side operator even without a Luxembourg company. It registers directly with the CCSS and attaches a current extract from its foreign trade register. The employer reports gross salary and hours each month, withholds the employee contribution share and pays the CCSS bill containing both shares. Where the salary is taxable through Luxembourg wage withholding, the employer also deducts, declares and pays that tax. Confirm which social-security system applies and whether the salary is subject to Luxembourg wage withholding.

Sources: Guichet.lu, registration of employers, Guichet.lu, social contributions for employees, Guichet.lu, withholding tax on salaries

Facture / Note d'honoraires

Invoice / fee note

This is the document the contractor hands to the foreign customer for booking, VAT analysis and collection of the debt. Luxembourg calls an invoice from a self-employed professional a note d'honoraires.

Issued by: The Luxembourg-resident contractor.

Timing: For a professional customer, issue it no later than the fifteenth day of the month following the service month. Periodic billing and deposits have their own stated timing, so place those dates in the contract before work starts.

Sources: Guichet.lu, invoice requirements and timing

An ordinary B2B service supplied by the Luxembourg contractor is taxed where the foreign business customer is established, or at the foreign establishment that actually receives it, so the invoice carries no Luxembourg VAT under the general rule. Record the customer's business status and receiving country before approving the first invoice. The result can change for services tied to land, event admission, passenger transport, catering or short-term vehicle hire. Describe the purchased service precisely enough to test those exceptions.

Sources: Guichet.lu, VAT place of supply for services

What an invoice has to show

• The autorisation d'établissement number and 2D barcode, plus R.C.S. Luxembourg and the registration number where applicable

  For an invoice over EUR 100, Luxembourg's supplier-identification list calls for the business permit number and, for a registered trader or company, the RCS wording and number. The permit page separately requires its 2D barcode on invoices. Check this cluster against the official permit and registry entries instead of accepting a trading name on its own.

  Sources: Guichet.lu, invoice requirements and timing, Guichet.lu, application for or modification of a business permit

• The EU customer's valid VAT number and the wording auto-liquidation when that customer owes the tax

  A Luxembourg contractor invoicing an identified business in another EU member state without Luxembourg VAT verifies the customer's VAT number, records the result and places the valid number on the invoice. Where the customer is liable for VAT, the invoice also carries auto-liquidation. An expired, mistyped or missing number does not satisfy the valid-number requirement. Provide the valid VAT number before the first invoice.

  Sources: Guichet.lu, invoice requirements and timing

• The Luxembourg tax reason for an invoice that shows no Luxembourg VAT

  The invoice must explain why the transaction is outside or exempt from Luxembourg VAT. For the ordinary foreign-B2B service, the reason follows the customer-country place-of-supply rule. For a domestic transaction covered by the national SME exemption, the current VAT law prescribes TVA non applicable - Article 57bis de la loi modifiée du 12 février 1979. These reasons describe different legal results. Reject an invoice that uses the small-business phrase as a substitute for the cross-border B2B analysis, or that removes tax with no reason at all.

  Sources: Guichet.lu, VAT place of supply for services, Guichet.lu, invoice requirements and timing, Luxembourg VAT Law, consolidated text at 1 January 2026

The contractor bills by facture, and the contract sets when that invoice is due. When no term was agreed and Luxembourg late-payment law governs the contract, the statutory 30-day backstop supplies the default point. Record the relevant invoice, service or acceptance event and the due date so the applicable payment date is clear.

Sources: Guichet.lu, invoice requirements and timing, Guichet.lu, payment deadlines and late-payment interest

When invoices are settled

If Luxembourg law governs the payment obligation, an agreed due date puts the business customer in default from the following day. Without an agreed term, default generally begins 30 days after the relevant receipt of the invoice, service or agreed acceptance event. B2B contracts use 60 days as the ordinary ceiling; a longer term must be express and cannot be grossly unfair to the contractor. Default brings the reference rate plus eight percentage points and a EUR 40 recovery fee without a reminder.

Sources: Guichet.lu, payment deadlines and late-payment interest

The currency on the invoice

A Luxembourg invoice may state its amounts in any currency. If the contract price is denominated in euro or another agreed currency, the invoice can carry that same denomination. Whenever Luxembourg VAT is payable or must be adjusted, the tax amount has to be expressed in euros. Treat the commercial denomination and the euro tax display as two separate checks. The first confirms that the invoice follows the agreed price currency; the second asks only whether VAT payable or adjusted is shown in euros. Do not convert every line item solely because a Luxembourg VAT amount must appear in euros. Book the commercial amount and any euro VAT amount as separate figures. Record the commercial currency and conversion responsibility in the contract.

Sources: Luxembourg VAT Law, consolidated text at 1 January 2026

Paying a trading name before matching the business permit holder and invoice identity

A trading name does not by itself identify the authorised supplier. The official permit search shows the permit number, and the invoice should connect the supplier identity to the permit barcode, legal form and RCS entry where applicable. Collect those details before approval and make the contract, invoice and payee match one supplier.

Sources: Guichet.lu, application for or modification of a business permit, Guichet.lu, invoice requirements and timing

Managing the contractor through fixed hours, internal reporting and changeable technical instructions

Those operating choices reproduce the managerial authority ITM describes for employment. Define the result, delivery dates and acceptance criteria, then let the contractor organise the working time and technical method needed to deliver it. Use contractual remedies for missed outcomes instead of line-management commands.

Sources: Inspection du travail et des mines, employer managerial authority

Treating the national small-business exemption as a blanket release from cross-border VAT administration

The national SME exemption does not erase every registration or return duty. A Luxembourg contractor who supplies services to a business in another EU member state for which that customer owes VAT may still need registration before the service and an intra-EU services statement. Ask which country receives the service and whether the customer is VAT-identified before accepting an exemption-based invoice. For a buyer outside the EU, document business status and the customer-country result without importing the intra-EU filing steps into that transaction.

Sources: Guichet.lu, registration for VAT, Guichet.lu, VAT place of supply for services