What financial assistance is available for renovating your home?

There are three types of support for renovation: direct capital support, support for sustainable housing and indirect support in the form of tax benefits. 

The main direct capital assistance is the grant for improving older homes. It is provided for certain types of work that improve the liveability, safety and security of old housing. It amounts to a maximum of 40% of the invoices for the work carried out. The amount is set based on your income and family circumstances.

Two conditions must be met. The first is that the lodgings concerned must be your permanent residence and you must not be the owner or usufructuary of another dwelling, whether in Luxembourg or abroad. The work must be carried out in a building that was first occupied more than 10 years ago. 

State aid (Klimabonus), interest subsidies and a State guarantee for climate loans, as well as a reduced VAT rate are available if you intend to improve the sustainable energy performance of your home. They concern, firstly the sustainable energy improvement of a dwelling that is over 10 years old (insulation work, replacement of windows, controlled ventilation) and secondly technical installations that use renewable energy sources (solar heating or solar electricity generating installations, heat pump, wood-burning furnace, district heating and/or connection to a heating network). To help you find your way around, Klima Agence has set up the following on its website an aid simulator and a presentation of the various aid programmes for sustainable housing and mobility. 

There are two types of indirect assistance. The first concerns the super-reduced VAT rate. The Luxembourg State has set a reduced rate of VAT at 3% on renovation work carried out on a person’s primary residence. This tax concession may not exceed €50,000 per home, and not all work qualifies for the reduced rate. This is particularly the case for fitted kitchens and special technical equipment, such as the installation of alarms, interior blinds and curtains or landscaping.

You can also deduct the interest charges and other costs related to the renovation of your home from your taxes provided that you do not occupy the dwelling for the duration of the work.

Our experts are on hand to advise and help you with your project. Make an appointment! 

To find out more about loans for energy renovation work, go to ing.lu/renovate

Key words: tax administration, financial assistance, renewable energy, taxes, ING, interest, housing, energy performance, grant, renovation, subsidy, super-reduced rate, conversion, works, VAT.

09/2023