Living in Liechtenstein: a fortune converted into income at 4 %, a state scale that rises to 8 % (excluding municipal supplement)

In Liechtenstein, the law provides for a wealth and income tax (Vermögens- und Erwerbssteuer) (Art. 1). Wealth is assessed using a standardized return of 4 %, which is added to income and then taxed along with the remainder according to the state tax scale (Arts. 5 and 14). This scale rises to 8 % for the highest bracket, excluding a municipal surcharge, the rate of which could not be determined. Subject to the limitations of the legislation, particularly regarding business assets, dividends and capital gains on private assets are exempt from income tax; the standardized return of 4 % remains taxable. Upon request, a tax based on expenditure, at 25 % of total expenditure, may be levied on an individual who meets four cumulative conditions, including not holding Liechtenstein citizenship (Art. 30); the administration makes the final decision. These rules are those of the Steuergesetz, as read in its version of 01/07/2026. This page does not deal with inheritance tax or residence permits.

Resident of Liechtenstein: domicile, or more than six consecutive months

A person is subject to Liechtenstein law without limit if they have their domicile or habitual residence there (Art. 6). This applies to all their assets and income. Domicile is defined as the place where they reside with the intention of remaining there permanently. Habitual residence requires a period of more than six consecutive months. Stays for study, accommodation in institutions, medical treatments, and holidays of up to twelve months do not constitute habitual residence (Art. 2).

Tax liability begins on the day a person establishes their domicile or habitual residence. It ends upon their death or departure abroad (Art. 7). Spouses are taxed jointly, regardless of their matrimonial property regime. Upon joint request, they may be taxed separately (Art. 8).

The wealth taken into account by a standardized return of 4 %

The law refers to a Wealth and Income Tax (Art. 1), a section of which, "Wealth Tax," begins in Art. 9. The text designates the standardized return on wealth as "Sollertrag." The rate is 4% (Art. 5), and the government must decide every four years on its appropriateness. This return is added to taxable income (Art. 14). Conversely, the income from the wealth on which the tax is thus paid is exempt (Art. 15).

Buildings and permanent establishments located abroad are also among the assets exempted under Article 10. Reread this passage before using it: it has only been read once.

State scale: from 0 to 8 %, before municipal supplement

Article 19 provides the rate in the form of formulas, where x is the taxable income. For a single person:

Spouses taxed jointly have their own tax rate: a common allowance up to CHF 31,710, then tax brackets ranging from 0.01 to 0.08 · x. For example, from CHF 147,981 to CHF 211,400, the tax is 0.05 · x − 3,488. From CHF 422,801, it is 0.08 · x − 12,895. A separate tax rate also exists for single parents.

The text refers to a state and municipal tax. The municipal surcharge is not specified in the law: its rate could not be determined, and the calculations on this page exclude it.

What Liechtenstein does not impose

Article 15 exempts several types of income from income tax:

• profit shares on participations in legal entities, i.e. dividends (letter n), subject to the limits of the text, in particular for commercial assets; ;
• capital gains on the sale of elements of private property, movable or immovable (letter m); ;
• capital gains on the sale or liquidation of participations, and unrealized capital gains (letter o), subject to the same reservation; ;
• capital from redeemable private capital insurance, with the exception of vested benefits policies and blocked accounts (letter d).

This exemption does not apply to everything. Capital gains on buildings are subject to a separate tax (see below), and the standardized return of 4 % remains taxable.

Taxation based on expenditure: 25 % of the total expenditure

Upon request, a tax based on expenditure can replace wealth and income taxes. Four conditions must be met (Art. 30):

1. to settle down for the first time, or after at least ten years of absence; ;
2. not to have Liechtenstein nationality; ;
3. not to engage in any gainful activity in the country; ;
4. living off the returns on one's wealth or income from abroad.

The rate is 25% of the taxpayer's total expenditure (Articles 32 and 33). Properties located in Liechtenstein remain subject to wealth tax. The page does not specify the minimum expenditure amount required by the tax authorities, nor whether they will grant the request: these points should be verified with the Liechtenstein tax authorities.

Pensions, insurance premiums and real estate gains

• Annuities. Old-age and survivors' insurance (OASI) and disability insurance (DI), occupational pension schemes, and pension funds are taxable (Art. 14). 70 % of OASI/DI pensions are deductible from income (Art. 16 para. 2 let. d).
• Insurance premiums. Private life, health and accident insurance premiums (excluding those covered by another letter of the article) are deductible up to CHF 3,700 per taxpayer, CHF 7,400 for spouses taxed together, plus CHF 2,200 per child (Art. 16 para. 3 let. d).
• Real estate gains. The tax rate under Article 19 for single persons applies to the taxable gain. A supplement of 200 % replaces the municipal supplement (Articles 42 and 43). The basic exemption is granted only once if several plots are sold within a five-year period.

Social security: the rates published by the Cleiss

The Cleiss, a French public body for international social security, publishes the rates as of January 1, 2024. The page is not more recent: check before making a decision.

The guaranteed salary for unemployment is capped at CHF 126,000 per year.

A couple, CHF 100,000 income, CHF 1,500,000 fortune: a numerical example (fictitious profile)

Situation. A fictitious married couple resides in Liechtenstein. They are taxed jointly. Their taxable income, after deductions, is CHF 100,000 (hypothetical), including the deduction of insurance premiums up to the CHF 7,400 limit applicable to spouses taxed jointly, without children (hypothetical; Art. 16 para. 3 let. d). Their taxable assets are CHF 1,500,000 (hypothetical).

Issue. He wants to know what the state tax calculated by the scale represents, without the municipal surcharge.

Strategy. He converts the wealth into income at a rate of 4 %, or CHF 60,000. He adds this to the income, resulting in CHF 160,000. He applies the tax rate for spouses taxed jointly under Article 19, bracket of CHF 147,981 to 211,400: 0.05 · x − 3,488.

Result. The tax is CHF 4,512, representing 2.82% of the total taxable income. By comparison, the tax rate for single individuals on the same basis would be CHF 6,912. This figure does not include the municipal surcharge, exemptions under Article 10, or deductions other than those already included in the CHF 100,000 threshold.

And what about France?

Moving to Liechtenstein does not automatically mean leaving your French tax residence. Article 4 B of the French General Tax Code (CGI) is based on three alternative criteria: your home or principal place of residence, your professional activity, and the center of your economic interests. Only one of these criteria is required. France does not have a tax treaty with Liechtenstein: the principality is not included in the official BOFiP (Official Bulletin of Public Finances). The implications of this are detailed on our page dedicated to the absence of a tax treaty.

What changes depending on your situation

• Your nationality, which determines taxation based on expenditure.
• The municipality where the residence is located, which sets the municipal supplement.
• The composition of your wealth: securities, real estate, debts, insurance contracts.
• Your family situation determines the applicable rate.
• Your French tax residence, which is assessed separately.

The rule depends on your situation. No results are guaranteed.

What this page does not cover

It does not handle inheritance tax, residence permits, local bank accounts, foundations, or companies. The municipal surcharge is not specified. Local tax matters should be verified with a Liechtenstein tax professional.