Fiduciary
Internship in Luxembourg
Many Luxembourg companies welcome students or interns. Internship at a company allows the student to acquire a first working experience and develop his skills, which could be beneficial for his future job search.
Employers also benefits from hiring interns since it allows them to face seasonal activity increase but more so, to detect new talents. Internships are often regarded by employers as an informal trial period to analyze the attitude, work, implication... of the intern and maybe hire him when he graduates.
When hiring an intern, employers must respect regulations on internships. When an employer hires an intern, they must sign an internship contract. He will need to make the intern is covered by social security and has work place accident insurance.
1- Internships included in an academic curriculum
Some internships are sometimes a requirement of an academic curriculum.
Even though there is no real subordination relation between the parties, and by consequence no real work contract, an internship contract is concluded between the intern, his educational institution and the business.
In this case, the employer does not need to register the intern with the CCSS if he is a Luxembourg resident studying in a Luxembourg establishment since he remains covered by either the insurance of his school or its parent's. Likewise, an intern that is a non-resident and is covered by the social security system of his country should not need to be registered with the CCSS.
In absence of an insurance against work place accident, the non-resident intern should be considered as an employee and rules regarding internships that are not part of an academic curriculum would apply.
2- Internships non included in an academic curriculum
When a person wants to intern at a company and that the internship is not supervised by his academic establishment, an internship contract must be signed between the intern and the company.
In this case, the intern must be affiliated by the employer with the CCSS for the pension, illness and workplace accident insurance. He will be considered as an employee.
Nevertheless, if the internship is exceptional for the intern and lasts no longer than three months per year, the intern only needs to be affiliated for work place accident insurance. However, if the internship lasts more than three months, he should be affiliated to illness, pension and work place accident insurance for the whole duration of the internship.
The minimal base amount for the computation of social security payments is the legal minimum wage for a non-qualified employee, namely 2256,95 € index 855,62.
3- Withholding tax
There is no obligation to compensate the intern. It remains the employer's sole discretion.
Internship compensation can be exempt from withholding tax (except for residents in an internship not supervised by an academic institution). To benefit from the exemption, the employer must file a request with the appropriate tax office. That exemption is only possible if the internship lasts less than six months.