Liechtenstein (LI)
Liechtenstein is a tiny constitutional principality nestled between Switzerland and Austria — one of only two doubly landlocked countries in the world — yet it punches far above its 39,000-person weight as one of the wealthiest nations on earth per capita.
Retirement & Pension in Liechtenstein
State pension, contribution refunds, private pension vehicles, and international agreements.
Liechtenstein operates a three-pillar pension system (Dreisäulenprinzip) identical in structure to Switzerland's: Pillar 1 (AHV — state pension, mandatory); Pillar 2 (BVG — occupational pension, mandatory for employed persons above income threshold); Pillar 3 (private pension savings, voluntary). The system is among the most well-funded in Europe — both the AHV and BVG pillars are financially robust. Retirement age in 2026 is 65 for both men and women (following alignment with Swiss AHV reform). The combination of a very low income tax rate, no inheritance tax, and a generous three-pillar pension system makes Liechtenstein an exceptionally attractive retirement destination for those who can achieve residence.
State Pension
The AHV (Alters- und Hinterlassenenversicherung) is the compulsory state pension. Every person who works or resides in Liechtenstein pays AHV contributions (4.35% employee + 4.35% employer = 8.7% combined). Self-employed pay 7.8% of net income. At retirement, the AHV pension is calculated based on the number of contribution years and the average annual income during the contributing years. AHV is a pay-as-you-go system — current workers fund current retirees.
Men: 65 (2026). Women: 64 years and 6 months in 2026, rising in three-month increments each year until reaching 65 from 2028 (following AHV21 reform). Flexible retirement: can begin AHV pension from age 63 (early retirement with permanent reduction); can defer to maximum age 70 (increase of approximately 5.2% per year deferred).
Minimum pension requires at least 1 contribution year. Full pension requires 44 contribution years (for both men and women). For persons with gaps in contribution history (due to years abroad), partial pensions are proportional.
Request an AHV Kontoauszug (account statement) from the AHV-Anstalt to see your accumulated contribution years and estimated pension. This can be requested annually at no cost. The AHV-Anstalt in Vaduz provides individual pension projections on request.
AHV pension is payable internationally — you receive your earned Liechtenstein AHV wherever you retire. SEPA bank transfer to EU/EEA countries is free. For non-SEPA countries, a small transfer fee may apply. AHV pension is taxable in your country of residence at retirement (subject to applicable double tax treaty). Liechtenstein has DTAs with many countries.
Pension Contribution Refund on Leaving Liechtenstein
AHV contributions are generally NOT refundable as a lump sum upon leaving Liechtenstein — AHV rights are accrued and paid as pension at retirement age regardless of residence. Exception: persons leaving to countries outside the EEA and bilateral agreement network may apply for AHV refund in specific circumstances. BVG (second pillar occupational pension): available for lump-sum payment (Barauszahlung) under certain conditions when leaving the Swiss/Liechtenstein pension zone permanently.
EEA nationals: AHV contributions cannot be refunded — accrued rights are retained as future pension entitlement under EEA social security coordination. Swiss nationals: same. Persons moving to another country covered by a social security agreement with Liechtenstein.
BVG Barauszahlung (lump-sum payment): applies after departure from Switzerland/Liechtenstein pension zone. No waiting period for the request, but processing takes 4–8 weeks. AHV refund (if eligible): complex — consult the AHV-Anstalt.
BVG (second pillar): employee contributions + employer contributions + investment returns = your full Altersguthaben (retirement savings). The lump sum may be subject to withholding tax in Liechtenstein (around 5% for EEA residents; higher for non-treaty countries). AHV: not typically refunded as lump sum — pension rights preserved for future payment.
Contact your Pensionskasse (BVG provider) directly with your departure date, destination country, and new bank account details. Provide your Ausländerausweis cancellation confirmation from Liechtenstein.
Before taking a BVG lump sum, consider whether you will retire in an EEA country — in that case, your BVG pension can be taken as a lifetime pension income rather than a possibly tax-disadvantaged lump sum. Seek advice from a Treuhänder or pension specialist.
International Totalization Agreements
Liechtenstein participates in the EEA Agreement social security coordination framework (EEA Regulation 883/2004), which allows contribution periods from all EU/EEA countries to be totalized (combined) for the purposes of meeting eligibility thresholds for pensions and benefits. Bilateral social security agreement with Switzerland provides particularly close coordination — Liechtenstein and Swiss AHV systems are closely linked. Additional bilateral agreements with countries outside the EEA.
Private Pension Vehicles
BVG Occupational Pension (Second Pillar)
Berufliche Vorsorge (BVG / Pensionskasse)All employees in Liechtenstein earning above CHF 22,050/year (mandatory)
Tax deduction — contributions to BVG are pre-tax
Contributions deducted from taxable income. Fund growth taxed at a flat rate within the pension vehicle (not standard income tax). Pension payouts taxed as income at retirement.
Mandatory minimum based on age (3.5–9% of insured salary); voluntary top-up contributions (purchases/Einkauf) possible
Fully portable within Switzerland/Liechtenstein. Transferable to a Freizügigkeitskonto (vested benefits account) when changing employers or leaving employment. Can be withdrawn as lump sum when permanently leaving the Swiss/Liechtenstein pension zone.
The BVG is typically the largest source of retirement income for Liechtenstein workers — often exceeding the AHV. The "Altersguthaben" (retirement capital) accumulates with a guaranteed minimum interest rate.
Pillar 3a (Restricted Private Pension)
Säule 3a (Gebundene Selbstvorsorge)Employed and self-employed persons resident in Liechtenstein — tax-advantaged private pension savings
Full tax deduction on contributions (up to annual maximum)
Contributions fully deductible from taxable income. Growth tax-free within the account. Taxed at a reduced flat rate on withdrawal at retirement (not as regular income). Liechtenstein applies equivalent rules to the Swiss Säule 3a framework.
CHF 7,258/year for employed persons with BVG (2026); CHF 36,288/year for self-employed without BVG (20% of net annual income, maximum)
Funds locked until age 60 (minimum). Can be withdrawn early in specific circumstances: property purchase, leaving Switzerland/Liechtenstein permanently, self-employment, disability.
Excellent first private pension step for Liechtenstein residents — relatively low maximum but significant tax saving, especially valuable given the low Liechtenstein income tax. Available through LLB, VP Bank, and Swiss banks accessible from Liechtenstein.
Pillar 3b (Free Private Savings)
Säule 3b (Freie Selbstvorsorge)Anyone — no restrictions. Flexible savings for retirement or other goals.
Some tax advantages depending on product type (life insurance policies may offer limited deductions)
Limited tax benefits compared to Säule 3a. Returns on savings/investments taxable. Some life insurance savings products have specific tax treatment.
No maximum
Fully liquid and portable
Pillar 3b is simply any non-mandatory savings/investment — bank savings, investment portfolios, real estate, or life insurance savings policies. Important for those who have maximised Säule 3a and BVG.
Early Retirement Options
Flexible AHV start: pension can begin from age 63 (with permanent reduction of approximately 6.8% per year before normal age). Many Liechtenstein residents use BVG capital or other savings to bridge retirement from age 58–63. The BVG Pensionskasse often allows retirement from age 58 under the applicable pension regulation. Early retirement in a country with a low income tax rate (like Liechtenstein) can be highly advantageous for tax optimisation of pension withdrawals.
Pension Gap Warning
Expats arriving in Liechtenstein mid-career will have fewer contribution years in the AHV system than lifetime residents — resulting in a smaller AHV pension. An expat arriving at age 35 and retiring at 65 will have 30 years of AHV contributions (30/44 = 68% of full pension) unless supplemented by credited periods from home country under totalization. The BVG (second pillar) partially compensates — but also accumulates fewer years for later arrivals. Private savings (Pillar 3a and 3b) are important gap-fillers for expat retirees. Request AHV projection from the AHV-Anstalt to quantify your personal pension gap.
Useful Links
Retirement & Pension
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