Doing Business in - JHI

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Doing Business in Liechtenstein Value Added Tax (VAT) Since January 1st 1995 turnover tax (referred to as WUST) has been replaced by value added tax (VAT). Liechtenstein holding companies and domiciliary companies are not able to obtain a VAT number unless they have a domestic turnover. ‘Domestic’ embraces the common Swiss/Liechtenstein economic area. VAT generally amounts to 7.6% and is levied on: the imports of goods; goods consumed and services provided domestically; services in excess of CHF 10,000 purchased abroad. For certain articles of daily use (e.g. food and beverage as well as cereals, medicines, newspapers) a reduced rate of VAT is applied. At present this amounts to 2.4%. all domestic deliveries of goods and the provision of services; Double taxation agreement Liechtenstein has only contracted two limited double taxation agreements, one with Switzerland and the other with Austria. PAGE 24 | DOING BUSINESS IN LIECHTENSTEIN
Doing Business in Liechtenstein Accounting and reporting Introduction By joining the European Economic Area on 1 May 1995, Liechtenstein committed itself to adopt the company laws of the EU in the Liechtenstein company law. After several years work the Parliament passed the changes in the Persons and Companies Code (Personen- und Gesellschaftsrecht (PGR)). The changes affected in particular the regulations on accounting and reporting. Liechtenstein had to adopt the 4. and 7. EU Directive on annual financial statements and consolidated financial statements. At the same time, Liechtenstein took the chance to modernise its general accounting and reporting standards. These changes have been integrated in the existing title. This title is divided into three sections: The first section (Art. 1045 – 1062a PGR) covers the general accounting regulations. The second, amendatory section (Art. 1063 – 1130 PGR) is again divided into three sections: i) annual financial statements and annual report, ii) group financial statements and iii) disclosure. The last of the three main sections contains additional rules for banks, financial institutes as well as insurance companies. General accounting regulations Corporate structure and size range As already mentioned the regulations on accounting and reporting are separated into a general and an amendatory section. While the general sections leave plenty of room for interpretation, the amendatory section contains a number of constraints. To what extent these constraints need to be applied in the reporting of the financial statements depends on the corporate structure and the size of the company. The following corporate structures have to apply the amendatory regulations: 9 Company limited by shares Limited Liability Company Partnership (under certain conditions 10 ) For an Establishment and a Trust reg. the general regulations only apply if they conduct a commercial business. If not, they don’t even need to prepare accounts unless the statutes request it. 9 Art. 1063 PGR 10 Art. 1063 Abs. 2 PGR PAGE 25 | DOING BUSINESS IN LIECHTENSTEIN
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Doing Business in - JHI

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