Verified Facts
The tax rates in Liechtenstein range from 1% to 8% for income tax, with a corporate tax rate of 12.5% and a value-added tax (VAT) rate of 7.7%.
Tax laws change frequently. Always consult a qualified tax professional for advice specific to your situation. This is a general guide only.
Quick Facts
Tax System Overview
Liechtenstein has a territorial taxation system, meaning that only income derived from sources within the country is subject to tax. However, individuals who are considered tax residents of Liechtenstein are subject to worldwide taxation, meaning that their global income is taxable in Liechtenstein. To be considered a tax resident, an individual must have their domicile or habitual abode in Liechtenstein. The country has a relatively low tax environment, making it an attractive location for individuals and businesses.
The tax system in Liechtenstein is designed to be efficient and business-friendly, with a focus on attracting foreign investment and promoting economic growth. The country has a network of double taxation treaties with over 60 countries, which helps to prevent double taxation and fiscal evasion. Additionally, Liechtenstein has a flat corporate tax rate of 12.5%, which applies to all companies, regardless of their size or industry.
Personal Income Tax
| Income Bracket (CHF) | Tax Rate |
|---|---|
| 0 - 15,000 | 1% |
| 15,001 - 25,000 | 2% |
| 25,001 - 50,000 | 3% |
| 50,001 - 75,000 | 5% |
| 75,001 and above | 8% |
| Individuals who are tax residents of Liechtenstein are entitled to various deductions and allowances, including a basic allowance of CHF 9,000, a spouse allowance of CHF 9,000, and a child allowance of CHF 2,500. Tax returns must be filed by March 31st of each year, and tax payments are due by the same date. Individuals who fail to file their tax returns on time may be subject to penalties and interest. |
Corporate & Business Tax
- The corporate tax rate in Liechtenstein is 12.5%, which applies to all companies, regardless of their size or industry.
- Small businesses with annual turnover of less than CHF 100,000 are exempt from value-added tax (VAT).
- Liechtenstein has several free zones, including the Vaduz Free Zone and the Balzers Free Zone, which offer tax exemptions and other incentives to companies that locate there.
- Companies that establish a presence in Liechtenstein must register with the Commercial Register and obtain a tax identification number.
- Companies that are considered foreign-controlled may be subject to withholding tax on dividends, interest, and royalties.
VAT / Sales Tax
- The standard VAT rate in Liechtenstein is 7.7%, which applies to most goods and services.
- A reduced VAT rate of 2.5% applies to certain goods and services, including food, books, and hotel accommodations.
- Exemptions from VAT apply to certain goods and services, including healthcare, education, and financial services.
- Liechtenstein has a tourist refund scheme, which allows tourists to claim a refund of VAT on certain purchases.
For Expats & Foreign Workers
- Tax residency rules in Liechtenstein are based on the individual's domicile or habitual abode in the country.
- Liechtenstein has a network of double taxation treaties with over 60 countries, which helps to prevent double taxation and fiscal evasion.
- Expats and foreign workers who are tax residents of Liechtenstein are required to register with the tax authorities and obtain a tax identification number.
- Expats and foreign workers may be subject to social security contributions, which are used to fund pension, healthcare, and other social benefits.
- Expats and foreign workers who are not tax residents of Liechtenstein may be subject to withholding tax on income derived from Liechtenstein sources.
- Expats and foreign workers who are tax residents of Liechtenstein may be required to file a tax return and report their worldwide income.
Crypto & Investment Income
- Investment income, including dividends, interest, and capital gains, is subject to tax in Liechtenstein.
- Cryptocurrency is considered a financial instrument and is subject to tax in Liechtenstein.
- Dividends received by individuals who are tax residents of Liechtenstein are subject to a withholding tax of 5%.
- Capital gains realized by individuals who are tax residents of Liechtenstein are subject to tax at the progressive tax rates.
- Investment income earned by non-resident individuals is subject to withholding tax in Liechtenstein, unless a double taxation treaty applies.