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THE MAIN CHARACTERISTICS OF Liechtenstein COMPANY

GENERAL
Type of entity
Limited Liability Company (Anstalt)
Political Stability
High
Type of law
Civil
Disclosure of Beneficial Owner
No
Migration of Domicile Permitted
Yes
Corporate Taxation
12,5%
Double taxation treaty access
Yes, not numerous
CORPORATE REQUIREMENTS
Minimum number of shareholders/members
One holder of Founder’s rights
Minimum Number of Directors/Managers
One
Corporate Directors/Managers permitted
Yes
Company Secretary Required
No
Usual Authorised Capital
CHF 30,000
LOCAL REQUIREMENTS
Registered Office/Agent
Yes
Company Secretary
No
Local Directors
Yes
Local Meeting
No
Government Register of Directors
Yes
Government Register of Shareholders/Members
No
ANNUAL REQUIREMENTS
Annual Return
Yes
Submit Accounts
Yes/No
RECURRING GOVERNMENT COSTS
Minimum Annual Tax/Licence Fee
CHF 1,200
Annual Return Filing Fee
N/A

INTEREST OF THE JURISDICTION OF Liechtenstein

Advantages of a company in Liechtenstein

  • Corporate tax rate of 12.5% with a minimum annual tax of CHF 1,200;
  • Liberal and flexible corporate law provides its own trust legal framework;
  • Political and economic stability;
  • Banking secrecy law;
  • Liechtenstein enjoys a very stable financial customs union with Switzerland.

Disadvantages of a company in Liechtenstein

  • Offshore companies cannot benefit from international double tax agreements.
  • The Anstalt, name of the company structure in Liechtenstein, can be expensive for non-trading operations or small assets.

Main info

The Principality of Liechtenstein is a small country in Central Europe, bordered by Austria and Switzerland. Its area is only 160 km², and the population is 35,000 people. Liechtenstein is the richest German-speaking country and enjoys economy with:

  • The highest gross domestic product (GDP) in the world;
  • The world’s lowest external debt;
  • One of the lowest unemployment rates;
  • The economic strength is link to its robust financial sector located in the capital, Vaduz, which has been identified as a modern tax haven.

Liechtenstein is a constitutional monarchy; the head of state is the prince. His powers include the right of veto on legislative acts, the right of pardon, the appointment of judges, members of the government, single-handedly pass laws, and represent the country in international relations.

Legislative power belongs to the parliament – the Landtag, consisting of 25 members. Members of the Landtag are elected for a term of 4 years. The executive power is represented by the government, headed by the prime minister, whom the prince appoints. Usually it is the head of the party with the majority in the parliament or the coalition.

The judicial system of Liechtenstein consists of the State Court (the body of constitutional justice), administrative and land courts, the courts of appeal and the highest instance – the Supreme Court of Justice.

The legal system of Liechtenstein was formed under the influence of the Austrian and Swiss. Particularly important was the impact of Swiss trade law on the economic environment of the country.

Types of companies and incorporation procedure

The Liechtenstein offers unique blend of most attractive economic and financial features, which provide a wide range of solutions and add value investment vehicles. At this moment, a lot global companies enjoy offshore solutions that Liechtenstein offers.

The main corporate forms for doing business in Liechtenstein are corporations (Aktiengesellschaft), funds (Stiftung), establishments (Anstalt). Also in Liechtenstein, you can register a limited liability company (Gesellschaft mit beschränkter Haftung).

01. Limited liability company (GmbH)

A limited liability company can be created by one or more participants, both natural and legal persons. The minimum charter capital is usually 10,000 Swiss francs. The liability of the members of the company is limited to their contribution to capital. The main governing body is a meeting of shareholders. The appointment of an external auditor is mandatory if the company is large or medium.

02. Establishment (Anstalt)

This is a flexible corporate structure, which is very convenient for a small and medium business. This kind of entity is a peculiar combination of the corporation and the fund, through which you can carry out commercial activities or manage assets. The minimum authorized capital is 30,000 Swiss francs. The management body is the board of directors. The main reason for the popularity of using this form of the company is flexibility in terms of structuring, administration and legal typology.

Taxation

  • The tax legislation of Liechtenstein is characterized as liberal, thus ensuring the flow of investment in the country. Corporate income tax is levied on resident companies on their income around the world. Non-resident companies pay a tax only on profits from a source in Liechtenstein.

  • The fixed rate of corporate income tax is 12.5% (the annual minimum tax is 1200 francs). The minimum income tax is imposed on companies with the status of a private asset structure (Private Vermögensstruktur, PVS). Such status can be assigned to companies that manage assets and do not conduct commercial activities.

  • Taxable income is calculated on the basis of profit reflected in the financial statements for tax purposes, it is adjusted taking into account the deduction of interest. A conditional interest deduction of 4% is granted on the changed equity of the company.

    Corporate income tax is not collected from all sources of income. For example, dividends, capital gains and liquidation income are not taxed.

  • In Liechtenstein, VAT is levied on domestic supplies of goods and services and import of goods. The standard VAT rate is 8%, but there are also reduced rates.

    With respect to stamp duty, Liechtenstein applies rules similar to those in Switzerland. Companies in Liechtenstein with a capital of more than 1 million francs pay a stamp duty of 1%. If the capital exceeds 5 million, the rate is reduced to 0.5%, 10 million – 0.3%.

Bank system and economy overview

Liechtenstein has a developed economy and standard of living here could be mentioned as high. The industry is based on mechanical engineering, the production of devices, optics and electronics. Also the industries of food, textile, pharmaceuticals are developed. Agriculture is focused on the production of meat and dairy products. An important source of income is tourism and the services sector. Liechtenstein conducts active trade, its main trade partners are Switzerland and the EU countries. Liechtenstein exports machinery products, precision tools, ceramics and stamps. A small number of people and an actively developing economy lead to an influx of labor from neighboring countries.

The banking system in Liechtenstein is very effective, its banks have a good reputation, which turns this small country into an important financial center of Europe. Here, the principles of bank secrecy and confidentiality are strictly observed, which is of no small importance for international business. All this has caused more than 70 thousand foreign companies to choose Liechtenstein as a jurisdiction for registration.

HOW TO
PROCEED

To incorporate or purchase a company the following documentation should be provided:

01

A completed application form signed by the company or by the representative

03

A personal bill, which is less than 3 months old from the date of the application

02

Copy of valid passport

04

Payment of our fees

Note: additional documents may be required depending on the certain offshore bank.

Set-up time: From the moment, we are in possession of all required documents:

3 days

Incorporation of
a company or purchase
of an existing company

15 days

Delivery of the original
company documents

3 weeks

Offshore Bank: offshore
bank account opening