Principal Gestion

Tax system of Andorra

Andorra

Stable country with historically determined neutrality

Andorra is an active member of the international community, with a high level of security, quality of life and minimal tax pressure.

The crime rate in the country is practically non-existent, due to its favourable geographical location, small territorial size with two easily controlled border crossings.

The country has a respectful attitude towards representatives of different nationalities living here.

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Le pays
Andorra

Strategic Location and Privileges.

Andorra is a small Principality located in the Pyrenees, with a unique territory of 468 km2, strategically located between France and Spain. Due to its history, natural environment, social stability and dynamic economy, based mainly on the tourism industry (80% of GDP), tariff-free trade and tax system, the country is an attractive investment destination for business. Andorra can be reached by car from Barcelona or Toulouse, as well as by air to Andorra/La Seu Airport.

Andorra

A whole country at your fingertips.

The whole country is available for you!
Andorra awaits you both in summer and winter: 200 km of ski slopes, unique cuisine, diverse cultural life will not leave you indifferent!

Discover the hospitality and investment attractiveness of Andorra!

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Summary

Tax optimisation system

The Andorran Tax System, while adopting the basic principles of traditional systems, is based on a legal framework and combines a number of features to provide a competitive advantage over neighbouring countries.
Thanks to the reforms implemented, the Principality of Andorra is currently the only jurisdiction in the world that, with a stable tax legal framework approved by the EU and the OECD (Organisation for Economic Co-operation and Development), does not have tax rates above 10%.

VAT:

4.5 % (value added tax)

Two types of income tax

Personal income tax and corporate income tax.

Perfect taxation strategy
  • Up to €24,000 - 0% rate
  • From €24,001 to €40,000 - 5% rate
  • From €40,001 - 10% rate

The calculation is made by adding up the amounts that make up the different tranches. Thus, regardless of your income, the first 24,000 euros are exempt from tax, and so on.

10% on net income
One of the very few countries in the eurozone with no restrictions on the compensation of the Negative Taxable Bases (BINs) or on the deduction of financial expenses.
There are no withholding taxes on dividends or interest paid by Andorra to its foreign partners.
The DAC6 Directive, which introduces rules requiring taxpayers to report certain transactions to the relevant tax authorities, does not apply in the Principality of Andorra.
  • Notary fee ( 600 € / 1.200 € ) + 0,1 %
    There is no inheritance and gift tax or wealth tax.
  • 4% Real estate purchase tax.
  • Capital gains tax: reduced over 10 years (from 15% to 0% ).

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