# Liechtenstein: Residence and Taxes > How Liechtenstein residence works: quotas and lottery for residence permits, income and wealth tax, lump-sum regime for ultra-high-net-worth individuals, and no capital gains tax. Author: Мария Плотникова — юрист, Family Office (https://wiki.private.law/authors/plotnikova) Last modified: 2026-07-21T17:08:00.000Z Canonical: https://wiki.private.law/en/liechtenstein-residence Topics: migration, investments Jurisdictions: liechtenstein Semantic tags: tax-regime, wealth-planning, residence-permit --- ## Concept Liechtenstein is a tiny principality between Switzerland and Austria, just over 160 km² with around forty thousand inhabitants, home to one of the most stable financial sectors in Europe and a reputation as a place for very old and very quiet capital. The principality belongs to the EEA and Schengen, stays outside the European Union, uses the Swiss franc, and forms a customs and monetary union with Switzerland. Taxes here are moderate: rates are well below the European norm, but the treasury genuinely collects them. The hardest part is residence itself — obtaining a residence permit in Liechtenstein is harder than almost anywhere in Europe. ## Residence by Quota and Lottery The principality strictly caps the number of residents. For EEA nationals roughly 56 residence permits with the right to work open up each year: half are allocated by the government on application, and half are drawn twice a year in a lottery. A separate, even narrower quota — around fifteen places — is set aside for economically inactive newcomers living on their own capital. Swiss citizens go through their own channel for about 17 places a year. Nationals of countries outside the EEA need either an employment contract or real economic significance to the country. There is no direct purchase of residence through an investment, as in the Caribbean programmes or the [Andorra scheme](https://wiki.private.law/en/andorra-residence-permit) — the classic [golden visa](https://wiki.private.law/en/golden-visas) does not work here. ## Income and Wealth Tax Personal income tax combines a national rate of 1 to 8 percent with a communal surcharge of 150 to 180 percent of that figure; together the top effective rate comes to around 22 to 24 percent depending on the commune — well below neighbouring Austria and Germany. Wealth is taxed in an unusual way: net assets are multiplied by a notional yield of about 4 percent (Sollertrag), and that computed figure is added to taxable income, giving an effective tax on capital of roughly 0.06 to 0.9 percent a year. There is no capital gains tax on securities or crypto assets, and dividends are not taxed at the individual level either — which makes the principality convenient for holders of investment portfolios who have become [tax residents](https://wiki.private.law/en/tax-residency-basics) of Liechtenstein. ## Corporate Taxes, Foundations and the Privatvermögensstruktur The corporate layer is a separate reason wealthy families value Liechtenstein. The profits of all companies, foundations and establishments (Anstalt) are taxed at a single flat rate of 12.5 percent — one of the lowest in Europe — with a minimum tax of 1,800 francs a year. Inheritance and gifts are not taxed at all: the relevant tax was abolished in 2011. The principality took VAT from Switzerland along with its administration — a standard rate of 8.1 percent from 2024, against double-digit figures almost everywhere in the EU. The core of the local industry is the private [foundation (Stiftung)](https://wiki.private.law/en/private-foundations) and the [holding structures](https://wiki.private.law/en/holding-structures) attached to it. If a legal entity merely manages its own capital and carries on no commercial activity, it can obtain Privatvermögensstruktur (PVS) status: instead of 12.5 percent it then pays only the minimum of 1,800 francs and files no profit reporting. This relief was approved in its time by the EFTA Surveillance Authority as compatible with EU competition law; the minimum capital of a foundation is 30,000 francs, euros or dollars. > 💡 Personal residence in Liechtenstein is hard to obtain, but you can own assets through a local foundation from another country as well. Here it is important to remember the [CFC](https://wiki.private.law/en/kik) rules of your own jurisdiction: a foreign foundation or holding usually has to be declared at home, and the tax saved in the principality may be topped up where you are tax resident. ## Lump-Sum Regime for the Wealthy > 🔗 **Related** > [Tax Residency: Basics](https://wiki.private.law/en/tax-residency-basics) · [Private Foundations (Foundations / Stiftung)](https://wiki.private.law/en/private-foundations) · [Holding Structures](https://wiki.private.law/en/holding-structures) · [Monaco: Tax Regime](https://wiki.private.law/en/monaco-tax) · [Andorra: Tax System](https://wiki.private.law/en/andorra-tax) For the ultra-wealthy who do not work in the country and live on the return from their capital, there is expenditure-based taxation — the lump-sum. The tax is calculated on worldwide living expenses at a rate of about 25 percent, while the annual minimum is fixed at 300,000 francs and locked in for five-year periods. The regime is open to those moving to Liechtenstein for the first time, or after at least ten years away, who hold no local citizenship and fund their life from foreign sources. In practice the arithmetic makes sense at taxable capital of roughly 35 million francs and up; below that threshold ordinary taxation is more often cheaper. > ⚙️ The Liechtenstein lump-sum is close in logic to the Swiss forfait: the state takes a fixed sum instead of ordinary income and wealth tax. The administration differs — [Switzerland](https://wiki.private.law/en/switzerland-residence-permit) requires an annual control calculation, whereas Liechtenstein only periodically checks the declared level of expenses. It is a solution for those whose capital and spending are large and whose income arises outside the principality; for everyone else the main barrier remains the permit quota. ## International Status and Transparency Modern Liechtenstein combines low rates with full reporting. The principality has been in the EEA since 1995 and in Schengen since the end of 2011, so a resident gains freedom of movement across Europe and access to the single market. Bank secrecy in the old sense no longer exists here: a law on automatic exchange has applied since 2016, Liechtenstein was among the early adopters of [CRS](https://wiki.private.law/en/tax-transparency) and has reported account data for 2016 since 2017, while a separate exchange agreement with the EU has operated from the same time. The turn came after 2008, when a data leak from LGT Bank triggered an international scandal, followed in 2009 by the so-called Liechtenstein Declaration on adopting OECD tax standards. Since then the principality has rebuilt its model: a bet on genuine substance, a network of double-tax treaties, and a reputation as a transparent financial centre. For anyone who genuinely becomes a [tax resident](https://wiki.private.law/en/tax-residency-basics) and moves their centre of vital interests here, that is a benefit; for anyone who was looking for a quiet harbour for undisclosed capital, the window has closed. > 🧭 Liechtenstein suits those who want low but fully clean taxes and are ready either to actually relocate within the quota or to hold capital through local structures with honest reporting. There are no fast, anonymous solutions left here; the principality deliberately works with a narrow circle of long-horizon capital. > 🍓 Liechtenstein offers moderate personal taxes, no capital gains tax on securities or crypto assets, and a lump-sum regime from 300,000 francs a year for the ultra-wealthy. The profits of companies and foundations are taxed at a flat rate of 12.5 percent, while pure asset-holding structures (PVS) pay only the minimum of 1,800 francs. The main constraint is residence itself: around 56 work permits a year for EEA nationals, half of them through the lottery. *This material is of an expert-analytical nature and does not constitute individual legal or tax advice.* --- ## Sources - [LLV — National Administration: residence](https://www.llv.li/en/individuals/residence) - [STV — Tax Administration of Liechtenstein](https://www.stv.llv.li/) --- ## Factual claims - The turn came after 2008, when a data leak from LGT Bank triggered an international scandal, followed in 2009 by the so-called Liechtenstein Declaration on adopting OECD tax standards.