Buying a new car in Luxembourg: tips to know

If you have recently settled in the Grand Duchy, one detail may have surprised you: mobility is still based on the car despite the wide range of public transport services available. More than a means of transport, the car is rooted in the culture of the country. It is an object of desire, a topic of conversation and it arouses passions. Moreover, the conditions for buying a new car in Luxembourg have certain advantages over European neighbours. Synopsis.
Simplified procedures

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Registration and payment of the road vehicle tax are the preconditions for putting your new vehicle on the road.

However, nothing could be easier, even for newcomers. Most of the time, these steps are taken by the dealer making the sale.

However, in Luxembourg, it is necessary to have car insurance coverage in order to be able to register your vehicle.

17% VAT on new vehicles

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What is a new vehicle? According to the tax definition, it is a vehicle that is less than 6 months old or has travelled less than 6,000 km.

To insure a new vehicle, it is better to play it safe. In the event of an accident, if your new car is beyond repair, AXA’s Auto Privilege package allows you to buy the same car at its current price for 3 years.

AXA considers a vehicle as new until it is 12 months old. It can thus benefit from the 3-year coverage, even if it is no longer considered new for tax purposes.

You can also choose to buy your new vehicle abroad; the 17% VAT rate remains applicable, since it is linked to the country of registration.

But be aware that in this case, it is likely that your dealer will not know what steps to take to register your vehicle. No problem: your car insurer can assist you, by offering registration services. Once your vehicle is imported into Luxembourg, AXA’s Registration Service allows you to have your vehicle delivered directly to your home with its new number plates fitted, without having to worry about it.

Sustainable mobility

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Highly committed to reducing the ecological impact of travel, the Luxembourg government grants tax breaks to candidates for greener mobility.

Thus, since 2017, buying a zero-emission car, i.e. an engine powered by electric or hydrogen energy, has resulted in a reduction of €5,000 a year.

For hybrid vehicles (electric and thermal), €2,500 will be deducted from your tax base.

This policy of supporting an ecological transition can also be seen in terms of infrastructure.

Thus, by 2020, 800 charging stations for electric cars and plug-in hybrids will be installed throughout the Grand Duchy.

These terminals will be divided equally between Park & Ride (P+R) car parks and public car parks in the municipalities.

Also on the insurance side, green mobility allows you to benefit from discounts on your insurance premium.

The Autofestival, the High Mass of the automobile

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Nearly one-third of annual new vehicle sales are made during the motor show.

At the beginning of each year, during 10 days, nearly 30,000 visitors come to one of the country’s 75 car dealerships for 10 days.

On the event programme: new models, limited series to try but also special discounts...

The speciality of the festival is to bring together families looking for the right deal, as well as the curious and lovers of beautiful engineering.

Like Thomas, a young student from Luxembourg who dreams of owning a Jaguar one day. “I go there every year with friends. Luxury brands also get involved in the event. And the salesmen are happy to welcome us, even if we’re only there to look.”

But the Autofestival is also a way to do good business. An exceptional discount, accessories or options offered, each manufacturer is looking for a way to stand out. And the buyers know the difference.

Do you need advice ?

An advisor is available in every region of the Grand Duchy to offer you his services and his well-informed advice about insurance solutions :