Corporate Tax & Investment Structures – Liechtenstein

All companies pay flat 12.5% on taxable profits. No progressive rates, no variation by size. Applies equally to resident companies (worldwide income) and non-residents (Liechtenstein-source income). Among lowest in Europe. Competitive with Ireland (12.5%), lower than Switzerland average (14-21%).

All companies pay minimum annual tax CHF 1,800 regardless of profit. Creditable against actual income tax if higher. Private wealth structures and special asset dedications also pay minimum CHF 1,800 (exempt from regular CIT). Simple fixed cost for dormant/low-profit entities.

Dividends from companies with at least 25% participation generally tax-exempt. Capital gains from selling >25% holdings also exempt. Exception: low-taxed foreign subsidiaries with >50% passive income remain taxable. Standard EU-style participation regime. Favorable for holding structures.

Interest expenses generally deductible from taxable income. Safe harbor interest rates apply for related-party transactions. Notional interest deduction on equity available (similar to Belgian system). Reduces effective tax rate. Thin capitalization rules relatively flexible.

Liechtenstein does NOT levy withholding tax on dividends, interest, royalties paid to non-residents. Clean repatriation of profits. Major advantage for international structures. Inbound withholding often reduced/eliminated under treaties. Cash flow benefit.

Corporate losses can be carried forward 5 years. Offset against future profits. No carry back. Helps startups and growing companies. Relatively short period compared to unlimited carry forward in some jurisdictions but adequate for planning.

Liechtenstein has 22 double taxation treaties: Austria, Czech Republic, Germany, Hong Kong, Luxembourg, Malta, Singapore, Switzerland, UAE, UK, Uruguay, and others. Modern OECD-compliant treaties. Reduce/eliminate withholding taxes. Important for international business. Expanding network.

No special patent box or IP regime. Royalty income taxed at standard 12.5%. However, participation exemption may apply to IP-holding structures. No withholding on outbound royalties. Combined with low rate makes Liechtenstein viable for IP holding. Substance requirements apply.

Liechtenstein foundations (Stiftungen) taxed at 12.5% on income. Charitable foundations can be tax-exempt. Widely used for wealth planning, succession, asset protection. Modern foundation law. Endowment from abroad by non-residents: no tax. Distributions to non-resident beneficiaries: tax-free.

Trusts under Liechtenstein law or managed in Liechtenstein: minimum tax CHF 1,800/year if no legal personality. Trust Enterprises with legal personality: 12.5% on income. Liechtenstein adopted Hague Trust Convention 2006. Popular for international wealth structuring.

Unique Liechtenstein entity: Anstalt (establishment). Can be owned by single person (like sole proprietor) or have complex beneficiary arrangements. Taxed at 12.5% on income. Minimum tax CHF 1,800. Very flexible - used for trading, holding, personal planning. Legal personality but ownership privacy.