Retirement abroad is two decisions at once: where you want to live and who pays for what. In Luxembourg, the second question has clear answers, with one important twist this year. The country changed its pension rules in December 2025 for people who have worked there. This guide covers retiring in Luxembourg for people with a foreign pension and for those with a Luxembourg career.
Can you retire in Luxembourg with a foreign pension?
Yes, if you are a citizen of the EU, the EEA or Switzerland, and the conditions are the ones for any inactive resident. You need sufficient resources and health insurance covering all risks in Luxembourg. You declare your arrival to the commune and file the registration declaration within three months, as in our article on residence in Luxembourg for EU citizens.
Your pension is usually paid in your country of residence. You can keep paying it into your usual bank account or into a Luxembourg account. Our guide to opening a bank account in Luxembourg explains the options.
How do you get health cover with a foreign pension?
The S1 form, issued by the body that pays your pension, entitles you to Luxembourg health care at the expense of the paying country. Ask for it before you leave, then hand it to the CNS as soon as possible. Without it, you can join voluntary insurance, with a three-month waiting period before reimbursements start. The details are in healthcare in Luxembourg for expats.
British pensioners: GOV.UK says that if you receive a UK State Pension you request an S1 from the NHS Overseas Healthcare Services, then register it with the CNS.
Retiring across borders mixes three systems: your old pension fund, the Luxembourg health fund and two tax offices. Moovy can go through the official steps with you, from the S1 to the pension statements you will need for your first tax return. It prepares your file; the funds and the tax administrations decide.
Will your pension be taxed in Luxembourg?
When you settle in Luxembourg you become a tax resident, and residents are in principle taxed on all income, including a foreign pension. In practice, the tax treaty between Luxembourg and the paying country decides who may tax each kind of pension. Treaties often treat pay and pensions for public service (a former civil servant's pension, for example) separately from other pensions. Read the "pensions" and "government service" articles of the treaty that applies to you; the ACD publishes the list of treaties.
Declare your foreign pension to the tax administration even if it is exempt in Luxembourg: it can still determine your rate. Keep the annual statement of your gross pension and the tax withheld abroad. Our guide to income tax in Luxembourg for new residents explains the scale, the tax card and the return. For retirees who stay in class 1, 1a or 2, see Luxembourg tax classes.
What if you worked in Luxembourg?
The Luxembourg old-age pension is paid from age 65, with at least 120 months of insurance (compulsory, continued, voluntary or purchased back). It starts on the day of the 65th birthday, and it is never granted automatically. Ask for it from the CNAP, the national pension fund, if you live in Luxembourg, or from the fund of your country of residence if you live elsewhere. Guichet.lu advises applying between two and six months before the start date if you only worked in Luxembourg, and at least six months before if you also worked abroad. Periods in other European countries are added to reach the 120 months, and each country pays its share in proportion. Former cross-border workers get a Luxembourg pension paid in their country of residence, taxed according to the treaty.
Early old-age pensions are possible from 57 or 60 under conditions of insurance length.
What does the 2026 pension reform change?
The Chamber of Deputies voted the pension adaptations on 18 December 2025. According to the CNAP page, updated in February 2026, and Guichet.lu, updated in October 2026:
- the legal retirement age stays at 65;
- the overall contribution rate rises from 24% to 25.5% from 1 January 2026, split equally between the State, the employee and the employer (8.5% each);
- the insurance period needed for an early pension at 60 increases step by step: one extra month from 1 July 2026, two from 1 January 2027, four from 1 January 2028, six from 1 January 2029 and eight from 1 January 2030, depending on the year in which you reach both age 60 and the 480 months required;
- the pension at 57, with 480 months of compulsory insurance, is not affected;
- a progressive pension is introduced in the general scheme;
- from 1 January 2026, a tax abatement can be requested through MyGuichet.lu by people who could already retire but keep working.
Pensions already paid and old-age pensions at 65 are not affected.
What should retirees watch out for?
- No S1 and no insurance for the first three months.
- Public-service pension versus other pensions. Treaties often treat them differently.
- Planning an early pension without checking your insurance record. The 2026 rules lengthen the period for retirement at 60.
- Forgetting to declare a foreign pension.
What does retiring in Luxembourg cost compared with your home country?
Think in three buckets. First, housing, which is the heavy item: see renting in Luxembourg and buying property in Luxembourg. Second, tax: as a resident you are in principle taxed on all your income, so compare how your pension would be taxed under the treaty with how it is taxed now. Third, health: with an S1 the paying country bears the cost, and without it you may pay contributions to voluntary insurance. Public transport is free, which makes a car optional for many retirees; the cost of living in Luxembourg gives the details.
Who should you ask before retiring in Luxembourg?
Before you decide, confirm your situation with your pension fund and with an adviser; three contacts can save you from an expensive mistake. Your current pension fund can tell you how the pension is paid abroad and whether it issues an S1. A tax adviser who knows the treaty between Luxembourg and your country can tell you where the pension is taxed. The Luxembourg health fund can confirm how your S1 will be registered. If you have also worked in Luxembourg, the national pension fund (CNAP) can give you a statement of your insurance record, which is useful for the 120-month requirement.
Ask each of them in writing and keep the replies. Rules about pensions and taxes are complex and change, and an answer you can show later is worth more than an assurance on the phone.
What are the first steps for retiring in Luxembourg?
- Request your S1 from the body that pays your pension.
- Check your resources and health cover, which the commune will ask for when you register.
- Declare your arrival to the commune and file the registration declaration; see residence in Luxembourg for EU citizens.
- Hand the S1 to the health fund.
- Contact the tax administration about your first return, with the annual statement of your pension.
Then take your time: the free trains and buses are a good way to discover the country.
For daily life afterwards, from free transport to languages, see living in Luxembourg.