Liechtenstein

Liechtenstein adopts the VAT law from Switzerland while maintaining its own VAT administration. As of January 2024, the general VAT rate is 8.1%, up from 7.7% at the end of 2023. Various goods and services, such as food, drugs, newspapers, and magazines, benefit from a reduced VAT rate of 2.6%. Additionally, lodging and accommodation services are taxed at 3.7%. Certain services like health, banking, insurance, and social security are VAT-exempt in Liechtenstein. Businesses operating in Liechtenstein, regardless of their legal form, are liable to VAT if their annual turnover exceeds CHF 100,000, though exemptions exist for non-profit institutions and organizations involved in sports and cultural activities.

Personal Income Tax (PIT) in Liechtenstein uses a progressive bracket system combining national tax with communal surcharges. National tax rates range from 1% to 8% on taxable income after personal exemptions (CHF 15,855 for single persons). Communal tax is levied as a surcharge of 150% to 180% on national tax, resulting in effective rates from 2.5% to 22.4%. Residents are taxed on worldwide earned income and net wealth; non-residents are taxed only on Liechtenstein-sourced income. A lump-sum taxation regime based on expenditure is available for qualifying new residents who do not carry out employment in Liechtenstein. PIT returns are generally due between mid and late April each year.

Liechtenstein imposes a personal income tax at a headline rate of 22.4%. Personal Income Tax returns are due between mid and late April each year. Final payments must be made within 30 days after the taxpayer has received the final tax assessment from the Liechtenstein tax authorities. There are no specific estimated payment due dates for personal income tax in the country.

In Liechtenstein, capital gains from the sale of shares or securities are generally exempt from taxation. However, capital gains from the sale of real estate or equivalent transactions are subject to a separately assessed real estate profit tax. The taxable gain is generally the difference between the sale proceeds and the original purchase price plus capital expenditure incurred. The basic tax rate can be as high as 24% depending on the amount of taxable real estate gain. The transfer of economic ownership of real estate (e.g. via sale of the majority of shares in a real estate company) may also trigger real estate profit tax.

Capital gains from the sale of real estate or equivalent transactions in Liechtenstein are subject to a separately assessed real estate profit tax. The taxable gain is generally the difference between the proceeds of the sale and the original purchase price of the property plus any capital expenditure incurred. The basic tax rate can be as high as 24%, depending on the amount of taxable real estate gain. The transfer of economic ownership of real estate (e.g. via the sale of the majority of shares in a real estate company) may also trigger real estate profit tax. Liechtenstein imposes a tax on certain insurance premiums at 5% of the cash premium (2.5% for life insurance).