According to the Luxembourg tax law, donations of immovable and movable property by notarial deeds are subject to registration duties (i.e. gift taxes). The registration duties are calculated on the market value of the property estimated on the day of the donation and depend on the degree of relationship between the donor and the donee. The rates vary from 1.8% or 2,4% for gifts in direct line (between grand-father and grand-son for example) to 14,4% for gifts between non-related persons.
When the donees are municipalities, public institutions, hospices, social offices, non-profit associations or foundations, the rate is 4.8%. Registration duties are divided by two for gifts made in a contract of marriage. Are exempted from registration duties gifts for scholarships to universities or institutions of higher education.
In principle, registration duties are paid by the donator, unless it is stipulated in the notarial deed that the duties will be paid in whole or in part by the donee.
In addition to the registration duties, the donator has to pay the notary. Notarial fees are calculated in accordance with the value of the goods and the complexity of the legal act. Moreover, immovable goods are subject to a transcription tax (1%) and a municipal surcharge if the property is located within the Luxembourg City municipality.