Going Offshore - Crowe Horwath International

Horwath MAK
Member Crowe Horwath International
20. LIECHTENSTEIN
Geography, Location & General Information
The Principality of Liechtenstein (160 sq. kms) lies in the region of the Upper Rhine between
the Swiss Conto of St. Gall and the Austrian Federal State of Voraiber. The Lordship of
Schellenberg and the County of Vaduz, purchased during 1699 and 1712 by the Princely
Family of Liechtenstein in the folds of the Holy Roman Empire of German Nations. The
princes of Liechtenstein gave the newly formed country their family name and they in
fact required a principality to become Princes of the Realm in the Habsburg Empire. In
1806 Napoleon I granted the Principality full sovereignty in the confederation of the Rhine.
After the Napoleonic era at the Vienna Congress, Liechtenstein became a member of the
German confederation until it was dissolved in 1866. During 1852 Liechtenstein entered
into a Customs Treaty with the Austro-Hungarian Monarchy. After the collapse of the Donau
Monarchy, Liechtenstein remained independent and in 1923 signed Customs Treaty with
Switzerland and the Swiss franc has been the monetary unit of Liechtenstein since 1924.
Taxation
The taxation of domiciliary entities is restricted to a capital tax at a preferred rate of normally
0.1% on capital paid in or invested assets and reserves, however, with a minimum tax of
CHF1,000 per annum per entity. A stamp duty is levied during formation of the capital of a
limited company, an establishment and trust enterprise, normally in an amount of 3%, for
family foundations only 0.2% or a minimum of CHF200. A trust pays no duty. A reduction
of duty may be applied for under certain Circumstances should the registered capital be
higher than CHF 5 mio(1.5%) or more than CHF10 mio(1%).
Liechtenstein has only one double taxation agreement with Austria. Local representation is
required on the boards of all juridical persons and trusts and all entities must have a local
representative.
Summary
Liechtenstein is the most sophisticated of all offshore centres, situated in the heart of
Europe merely under two hours from Zurich Airport, with excellent telecommunications and
supported by internationally renowned’, highly efficient Liechtenstein banks and service
industries, with English widely spoken in addition to the native German dialect. Therefore
it attracts substantial clients requiring a liberal and flexible company law allowing the
formation of holding domiciliary companies, foundations and trust in a highly developed
jurisdiction.
Audit | Tax | Advisory | Risk
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