3% VAT
Home renovation in Luxembourg: works, steps, budget and grants in 2026
Renovating a house in Luxembourg takes eight steps: project and budget, energy advice, quotes, Klimabonus approval in principle, municipal permit if needed, VAT approval, works, then grant payment. A full renovation takes almost a year, including 3 to 6 months of works. In a home at least 10 years old used as a main residence, VAT drops to 3%.
Your result in 2 minutesFree simulator Estimated budget€VAT saving€Property value gain€ Instant result, no obligationStart the simulation →- Path: project and budget, energy advice, quotes, Klimabonus approval in principle, municipal permit if needed, VAT approval, works and handover, then grant payment
- 120 m² house: €30,000–90,000 excl. VAT for a refresh, €138,000–300,000 excl. VAT for a full renovation
- Duration: 1–3 weeks for a refresh, 3–6 months for a full renovation, plus 2–4 months of preparation
- 3% VAT instead of 17%: home at least 10 years old, main residence, tax benefit capped at €50,000 per dwelling
- Klimabonus: flat-rate amounts since 1 January 2026, increased for applications filed until 30 June 2027
- Permit: the municipality decides; no answer within 3 months counts as a refusal
- Construction prices: +2.6% in one year (STATEC, April 2026)
Which type of renovation for which project in Luxembourg?
Luxembourg renovation projects fall into five types, each with its own budget and grants. The type decides your first step: energy advice and Klimabonus approval in principle for an energy project, quotes and VAT approval for an interior project.
| Project | Typical works | Specific support | Detailed guide |
|---|---|---|---|
| Interior renovation | Painting, floors, kitchen, bathroom, electrics, partitions | 3% VAT | cost room by room, bathroom cost, kitchen cost, electrical renovation, plumbing and sanitary |
| Energy renovation | Roof and wall insulation, windows, MVHR, heat pump | 3% VAT + Klimabonus (+ social top-up, Klimaprêt) | energy renovation guide |
| Full house renovation | All trades, often with an energy component | 3% VAT + Klimabonus | renovating an older house, renovating a terraced house |
| Flat | Private unit; facade, windows and risers through the general meeting (see co-ownership renovation) | 3% VAT; envelope Klimabonus through the co-ownership | flat renovation |
| Extra living space | Attic, basement or garage turned into rooms | 3% VAT | attic conversion, basement conversion |
For the envelope and outdoor areas, see our dedicated guides: roof renovation (renewal, insulation, maintenance), facade renovation (rendering, cladding, external insulation), terrace and balcony renovation and outdoor landscaping (driveways, fences, garden).
Partial or full renovation: how do you choose the right level?
A partial renovation (1 to 3 rooms or a single trade) costs €750 to €1,250/m² excl. VAT of treated area and can usually be done while you live there; a full renovation costs €1,150 to €2,500/m² excl. VAT and generally means moving out for 3 to 6 months. The right level depends on the age of the wiring, plumbing and roof, not on the wish to redo everything.
| Criterion | Partial renovation | Full renovation |
|---|---|---|
| Budget | €750 – 1,250/m² excl. VAT (treated area) | €1,150 – 2,500/m² excl. VAT (whole area) |
| Duration on site | 2 to 8 weeks | 3 to 6 months |
| Trades | 1 to 3 | 5 to 9, to be coordinated |
| Home occupied | Usually yes | Rarely during structural work |
| Contingency | About 10% | 10% (recent home) to 20 – 30% (pre-1980 house) |
| Support | 3% VAT; Klimabonus if an energy item is treated | 3% VAT; Klimabonus, with an energy-class bonus if the home gains at least 2 classes |
Rule of thumb: networks and roof under 25 years old, a partial renovation is enough; a pre-1980 home never renovated calls for a full renovation, even if phased. The Klimabonus energy-class bonus (+20% to +50% on the insulation grant) can also be earned in stages, if an energy performance certificate before and after proves a gain of at least 2 classes. Test your case with the renovation simulator.
What budget should you plan to renovate a house in Luxembourg?
The budget depends first on the level of works, from a simple refresh to a full renovation: for a 120 m² house, allow €30,000 to €90,000 excl. VAT for a refresh and €138,000 to €300,000 excl. VAT for a full renovation, plus a 10 to 30% contingency depending on the age of the property. Ranges by level, worked examples and often-forgotten costs are detailed on our renovation cost per m² page, and the price of each trade in the renovation price index. On €100,000 of eligible works excl. VAT, 3% VAT saves €14,000 compared with the 17% rate.
What are the steps of a renovation, and how long do they take?
A full renovation often takes close to a year from the first quote to handover: 2 to 4 months of preparation, then 3 to 6 months on site; a simple refresh is done in 1 to 3 weeks. Paperwork and contractor availability, more than the works themselves, stretch the calendar.
| Step | Indicative time | Good to know |
|---|---|---|
| 1. Project and budget | 1 to 3 weeks | Contingency: 10% (recent home) to 20 – 30% (pre-1980) |
| 2. Energy advice and EPC | Depends on the advisor | Required for the Klimabonus beyond one element or with MVHR |
| 3. Quotes | 2 to 4 weeks | At least 3, same scope |
| 4. Klimabonus approval in principle | Before the works | Insulation, windows, MVHR; not for a heat pump |
| 5. Municipal permit | 3 months of silence = refusal | Valid 2 years, extendable by one year |
| 6. 3% VAT approval | Before the works | Filed by the company for any quote of at least €3,000 excl. VAT |
| 7. Works and handover | See below | Written report listing snags |
| 8. Klimabonus payment | Up to 4 years after the invoice year | Post-works EPC required |
How long the works take
| Works | Usual duration |
|---|---|
| Loft floor insulation | 1 to 2 days |
| Replacing a house’s windows | 1 to 3 days |
| Heat pump | 3 to 5 days, up to 10 if the heat distribution is modified |
| Refresh (painting, floors) | 1 to 3 weeks |
| External wall insulation | 2 to 4 weeks |
| Bathroom | 2 to 3 weeks (3 to 5 for high-end) |
| Kitchen | 1 to 3 weeks like-for-like, 4 to 8 weeks with a new layout |
| Full renovation of a 100–150 m² house | 3 to 6 months |
Delays come from deliveries, trade coordination, weather and discoveries on site (asbestos, damp, outdated networks): add 30% to the announced timeline and never pin a house move to the completion date. The order of works is detailed in our guide to renovating an older house. In an older building, have asbestos located before any demolition or sanding: see our page on asbestos surveys and removal.
When is the best time to renovate in Luxembourg?
Exterior work (roof, waterproofing, facade, windows) is best done from April to September, interior work all year round. On the grant side, approval-in-principle applications filed until 30 June 2027 benefit from the temporary Klimabonus increase: that is the date that matters most.
| Works | Recommended period | Why |
|---|---|---|
| Flat-roof waterproofing, roofing | April to September | Dry substrates are essential |
| Facade, external insulation | March to October | Frost compromises adhesives and renders |
| Windows | Summer | Openings exposed during fitting |
| Heat pump, boiler | May to September | No heating cut in winter |
| Interior painting | All year | Drying: above 15 °C, dry air |
| Kitchen, bathroom, floors | All year | Book 4 to 6 months ahead |
- 1 January 2027: pre-financing for heat pumps and insulation (invoices issued from that date); the registered company deducts the grant, for the same amount
- 30 June 2027: end of the increase (date of the approval-in-principle application; order date for a heat pump, which drops from €12,000 to €10,000 in a house, when it replaces fossil or direct electric heating)
- 31 December 2030: last date for a first approval-in-principle application
Do you need a building permit to renovate in Luxembourg?
Your municipality’s building regulations decide whether works are exempt, subject to a simple declaration or to a permit from the mayor. Light interior works are usually exempt; changes to the structure, facade, roof or use of a room are not. The model regulation recommended to municipalities by circular no. 2023-119 provides:
| Works | 2023 model regulation (if your municipality adopted it) |
|---|---|
| Interior works under 20 m² without touching the structure | Exempt |
| Interior works of 20 to 200 m² | Declaration |
| Renovating or insulating a facade or roof, unprotected building, no significant change in appearance | Exempt |
| New openings under 5% of the facade | Declaration |
| Demolition of 100 to 1,000 m³ | Declaration (permit above) |
In Luxembourg City, for example, redoing a facade or roof requires a declaration outside protected areas and a permit inside them. A permit is valid 2 years, extendable once by one year; without an answer within 3 months, the application is deemed refused. Details on our building permit and works declaration page.
Which grants are available for renovating in Luxembourg in 2026?
Two schemes cover most renovations: 3% VAT on all eligible works in a home at least 10 years old used as a main residence, and the Klimabonus Wunnen for the energy component, paid as flat-rate amounts since 1 January 2026 (law of 24 July 2026, retroactive). Amounts in brackets apply to applications filed until 30 June 2027.
| Support | Amount | Key conditions |
|---|---|---|
| 3% VAT | 14 VAT points saved, benefit capped at €50,000 per dwelling | Home at least 10 years old when works start; main residence of the owner or tenant; approval requested by the company before works |
| Klimabonus insulation | €35–130/m² against the outside (€40–155/m²); €20–65/m² against an unheated space (€25–75/m²) | Building over 10 years old; approval in principle before works; grant capped at 60% of the cost excl. VAT |
| Klimabonus windows | €70/m² (€80/m²) | Glazing Ug ≤ 0.6 W/m²K (triple glazing); approval in principle before works |
| Klimabonus air-to-water heat pump (house) | €10,000 (€12,000 if ordered before 30 June 2027) | Replacing fossil or direct electric heating, otherwise €4,000 less; applied for after installation |
| Energy advice (house) | €1,700 (€2,000) | Mandatory as soon as the renovation covers more than one element or includes MVHR |
| Social top-up, Klimaprêt | 10 to 100% of the Klimabonus depending on income (link with the 2026 scheme to be confirmed with the Guichet unique); State pays 1.5% interest per year (up to €100,000 and 15 years) | Main residence; top-up income-tested, Klimaprêt with no income condition |
Air conditioning gets neither the Klimabonus nor 3% VAT. Fitted kitchens, furniture, architect fees and home automation stay at 17%. The Klimabonus excludes single-flow ventilation, solid front doors and fossil insulants (polystyrene, polyurethane) with 50% recycled content or less.
All amounts: 2026 grants and Klimabonus page. Free, neutral advice: Klima-Agence, 8002 11 90.
How do you choose the companies for your renovation?
Before signing, check the company’s business permit (autorisation d’établissement), its Trade Register entry, a current insurance certificate and a detailed quote, compared with at least two others. For a full renovation, decide who coordinates: general contractor, architect (8 to 15% of works excl. VAT) or yourself. Hourly rates run from €45 (painter) to €95 (heating engineer) excl. VAT: see the hourly rates comparison. Full method: our guide to choosing a renovation company.
Which flooring should you choose in Luxembourg? Installed prices and lifespan
In Luxembourg, installed flooring costs, excluding VAT, from €30 to €60/m² for laminate to €90 to €160/m² for solid parquet, and €60 to €150/m² for tiles supplied and laid; tiles and engineered wood offer the best balance between price and lifespan (20 to 40 years and 15 to 25 years). Laid by a company in your main residence completed at least 10 years ago, flooring is invoiced at 3% VAT. Full comparison of floor coverings, prices and lifespans: interior renovation: flooring and other item prices, with parquet details on parquet and flooring cost.
Renovating a rental home or an investment building: VAT, grants, obligations
A landlord renovating a home let as the tenant’s main residence gets 3% VAT and can apply for the Klimabonus, which does not require the owner to live there. The Klimaprêt, the State guarantee and the social top-up, however, are reserved for a home that is the owner’s main residence.
| Lever | Rule for a landlord |
|---|---|
| 3% VAT on renovation | Yes if the tenant has their main residence there; €50,000 benefit cap per dwelling, so one cap per flat in a building |
| 3% VAT on creating a dwelling intended for rent | No: excluded since 1 January 2015, invoiced at 17% |
| Klimabonus | Yes, no residence condition; dedicated forms for co-ownerships |
| Klimaprêt, State guarantee, social top-up | No: owner’s main residence required |
| Energy performance certificate | Mandatory for a new letting if there is no valid certificate (valid 10 years); energy class and insulation class in every advert |
| Works fund (co-ownership) | Mandatory since 1 August 2023 |
Rent is capped by the residential lease law according to the capital invested, which investment works increase (routine maintenance does not): have the calculation checked before raising a rent. Effect of the energy class on value: energy passport and property prices.
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Frequently asked questions about renovating in Luxembourg
How much does it cost to renovate a house in Luxembourg?
Excluding VAT, allow €250 to €750/m² for a refresh, €750 to €1,250 per treated m² for a partial renovation and €1,150 to €2,500/m² for a full renovation (renov.lu survey, September 2026). For a 120 m² house, that is €30,000 to €90,000 for a refresh and €138,000 to €300,000 for a full renovation, plus a 10 to 30% contingency depending on the age of the property. The 3% VAT rate then applies if the home is at least 10 years old and is a main residence.
How long does a full renovation take in Luxembourg?
A full renovation of a 100 to 150 m² house takes 3 to 6 months on site, preceded by 2 to 4 months of preparation: quotes, energy advice, Klimabonus approval in principle and, where needed, a municipal permit. A refresh takes 1 to 3 weeks, a bathroom 2 to 3 weeks (3 to 5 for high-end), a kitchen 1 to 3 weeks like-for-like or 4 to 8 weeks with a new layout. Add 30% to the announced timeline.
Can you combine 3% VAT and the Klimabonus?
Yes. 3% VAT reduces the bill for all eligible works in a home at least 10 years old used as a main residence, and the Klimabonus comes on top for insulation, windows, ventilation and technical installations. The Klimabonus is a flat rate whose cap is calculated excluding VAT: for insulation, it cannot exceed 60% of the cost of the works excluding VAT.
Which renovation works stay at 17% VAT in Luxembourg?
The standard 17% rate still applies to furniture and fitted kitchens, air conditioning, alarms and home automation, outdoor landscaping except direct access to the home, interior blinds, and architect, engineer and notary fees. Solar panels installed on a private home, by contrast, are invoiced directly at 3%, outside the €50,000 cap.
Do you need to notify the municipality to renovate the inside of your home?
Usually not for light interior works that do not touch the structure: the model regulation offered to municipalities exempts them below 20 m² and requires a simple declaration from 20 to 200 m². Each municipality sets its own rules, however, and removing a load-bearing wall, changing the use of a room or altering the facade requires a permit from the mayor.
Who should coordinate a full renovation?
Three options: a general contractor, who signs a single contract and coordinates its subcontractors; an architect, who designs, consults the companies and supervises the works for 8 to 15% of the works cost excluding VAT; or yourself, with separate contracts per trade. Beyond three trades, or as soon as a building permit is needed, a professional coordinator avoids most delays.
When is the best time to renovate in Luxembourg?
For the roof, waterproofing, facade and windows, aim for April to September; interior works can be done all year round. On the grant side, an approval-in-principle application filed before 30 June 2027 benefits from the temporary Klimabonus increase, and an air-to-water heat pump ordered by that date receives €12,000 instead of €10,000 if it replaces fossil or direct electric heating in a house.