Taxes in Liechtenstein

The Steuerverwaltung Liechtenstein, under the Ministry for Presidential Affairs and Finance, administers the main national taxes. Municipal tax offices handle municipal taxes, which are collected together with the national wealth and income tax. The municipality sets a surcharge of 150% to 250% of the national tax rate. The national tariff for individuals is progressive, has eight bands and reaches a maximum rate of 8% before the municipal surcharge. Individuals with a residence or habitual stay in Liechtenstein are generally subject to unlimited tax liability. A person without such a connection can still have limited tax liability on assets or income located in Liechtenstein. Wealth and income tax covers taxable assets and income. For wealth tax, Liechtenstein generally calculates a standardized return on assets using a 4% interest rate. Deductions, treaty relief and credits for foreign withholding tax depend on the facts of the case. Withholding tax, called Quellensteuer, is collected by the payer before certain income reaches the recipient. For residents, it can apply to employment income, replacement income and meeting fees. For foreign nationals, it can also apply to pension and capital payments from the first or second pillar and to withdrawals from vested-benefits arrangements. Employers deduct the tax, transfer it and report the relevant information. Since 1 January 2025, legal entities have used eLohnausweis and eLohnlisten for the relevant wage reporting. Property gains tax applies to gains from selling, or economically transferring, a Liechtenstein property under articles 35 and following of the Steuergesetz (SteG). The taxable gain and the assessment depend on the property, acquisition and disposal circumstances. A sale can therefore create a separate tax issue even when the owner has already dealt with ordinary income and wealth tax. Companies generally pay Ertragssteuer, Liechtenstein's corporate income tax, at 12.5%. The minimum income tax is CHF 1,800. A PVS, meaning a private asset structure without economic activity, does not pay ordinary corporate income tax but remains subject to the CHF 1,800 minimum tax. It needs a status application and annual confirmation. The global minimum tax rules known as GloBE have applied since 1 January 2024 to qualifying domestic entities, including companies, trusts and partnerships, within a multinational enterprise or large domestic group whose ultimate parent has revenue of at least EUR 750 million in at least two of the four preceding financial years. The effective minimum level is 15% through the qualified domestic minimum top-up tax (QDMTT) and, where relevant, the income inclusion rule (IIR). A GloBE return is generally due 15 months after the end of the financial year, or 18 months for the first filing. Liechtenstein and Switzerland form a treaty-based common domestic territory for value added tax. Value added tax, called Mehrwertsteuer or MWST, largely follows the Swiss rules. Since 1 January 2024, the rates have been 8.1% standard, 2.6% reduced and 3.8% for accommodation. An enterprise with taxable activity and a domestic connection is generally liable once turnover reaches CHF 100,000. The threshold is generally CHF 250,000 for non-profit sports or cultural organizations and charitable organizations. Registration through the eMWST portal is due within 30 days after the liability arises. Since 1 January 2025, all VAT transactions must be handled through the eMWST portal. The Swiss Federal Tax Administration (ESTV) in Bern is responsible for certain VAT cases involving foreign enterprises or other Swiss-Liechtenstein arrangements. Tax returns are filed after the public announcement and with the designated form. A missing form does not remove the duty to file; the taxpayer must request one if necessary. Individuals and legal entities can use eTax. The Steuerverwaltung sets the general payment date, and a taxpayer can request an extension where the procedure permits. A binding advance ruling can clarify the tax treatment of a planned transaction. Voluntary disclosure may reduce the consequences of an omission if its legal conditions are met. An objection against a tax assessment or another appealable decision must generally reach the authority within 30 days after service. International cases require a separate residence and treaty analysis. Liechtenstein has double-taxation agreements and tax information exchange agreements and applies automatic exchange of information under the Common Reporting Standard, FATCA, CARF, country-by-country reporting and exchange of information on request. The OECD Transfer Pricing Guidelines provide the reference for related-party pricing. Double taxation relief, including a credit for foreign withholding tax for individuals, depends on the applicable treaty and the income. Cross-border employee cases are particularly affected by the Liechtenstein-Switzerland agreement and by practice concerning Austria. Keep the assessment, payment, employer reporting, VAT registration and international reporting as separate obligations because one filing does not replace the others.