Capital
Luxembourg
Currency
Euro
Languages
Luxembourgish, French, German
Population size
0.64M
Average Monthly Salary
€4000
EU
Since 1958
Region
Western-Europe
Gift Giving Norms
Quality, branded corporate gifts expected
Major Corporate Gift Days
Christmas, National Day
Customs Complexity
Low
VAT - Standard Rate
17%
Duty Free Threshold
€150
Ave Duty Rate
2%
1. Employee Merch vs. Gifts
Under Luxembourg law, non-cash benefits given to employees may be deemed taxable unless they clearly serve a work-related purpose. The Administration des contributions directes (ACD) regulates whether items are legitimate business tools or personal perks.
1.1 Merchandise for Employees
Work-Related (Generally Non-Taxable)
Uniforms & Mandatory Equipment
If branded attire or gear is essential for daily duties (e.g., safety clothing, official uniform), it typically remains outside taxable income.
Branded Accessories
T-shirts, mugs, or notepads bearing a clear company logo, distributed uniformly, can be considered part of workplace identity rather than personal benefits.
Potentially Taxable Benefits
High-Value or Purely Personal Items
Electronics, designer goods, or items with minimal link to the job may be classified as taxable wage. The employer must then handle any added taxes or social contributions.
Frequent Gifting
Providing multiple gifts annually could lead to scrutiny over disguised salary. Seek local advice if you plan several merchandise drops a year.
1.2 Gifts for Non-Employees (Clients, Partners, Event Attendees)
Tax & Deductibility
Business gifts serving promotional or goodwill aims are typically tax-deductible, provided the cost is reasonable and documented. Lavish gifts lacking commercial rationale may be challenged by tax authorities.
Compliance & Anti-Bribery
Luxembourg’s legal framework emphasises financial transparency, especially in finance or public dealings. Maintain thorough records for higher-value gifts to mitigate corruption concerns.
1.3 Marketing Merch
Branded items (e.g., T-shirts, totes, pens) given out at fairs or product launches usually qualify as marketing expenses, as long as you retain invoices and distribution details.
2. Shipping, Customs & Duties
2.1 Shipping
2.2 Importing
Import Duties & VAT
Merchandise from non-EU countries above a certain threshold (often €150) may incur customs duties, plus Luxembourg VAT (17%) on (value + duties + shipping).
Documentation
A commercial invoice, HS codes, and accurate product descriptions are essential for smooth customs clearance.
2.3 DDP vs. DAP
Delivered Duty Paid (DDP)
The sender covers all import fees, streamlining the experience for the Luxembourg recipient.
Delivered At Place (DAP)
The recipient pays duties/VAT upon arrival, which can cause delays if they’re unprepared.
2.4 With Monday Merch
We ship from Rotterdam (the Netherlands), ensuring duty-free deliveries throughout the EU. We also assist with VAT processes, keeping everything tax compliant.
3. Cultural & Local Etiquette
3.1 Gifting customs
4. Sustainability & Local Regulations
4.1 Sustainability & Regulations
5. HR & Employee Relations Considerations
5.1 HR & Employee Relations
6. Summary and Key Takeaways
6.1 Summary & Takeaways
7. Frequently Asked Questions
7.1 Questions & Answers
Do uniform distributions incur tax?
No, if mandatory for work. Personal-value items might be taxed as a benefit.
Are B2B gifts typically deductible?
Yes, if they’re for a genuine promotional aim, provided costs remain moderate.
Cultural nuance?
Luxembourg’s international climate values refined, practical gifts, not excess.
