Tax in Andorra

Who is the tax authority?

Andorra's Departament de Tributs i de Finances (Ministry of Finance — Ministeri de Finances) administers the national tax system. It operates the online filing portal at impostos.ad. The professional body for qualified practitioners is the Col·legi d'Economistes d'Andorra.

The statutory foundation rests on three laws. Llei 5/2014 governs personal income tax (IRPF). Llei 95/2010 governs corporate income tax (Impost sobre Societats — IS). Llei 11/2012 governs the Impost General Indirecte (IGI), Andorra's VAT-equivalent.

Andorra signed the EU Association Agreement in 2024, progressing toward closer economic integration while remaining outside the EU customs union and common market.

What is the tax year and when are returns due?

Andorra's tax year is the calendar year (1 January to 31 December). Personal IRPF returns (Model 100) are due between April and September of the following year. Corporate IS annual returns are due within seven months of the fiscal year-end. IGI registered businesses file quarterly returns.

Who is an Andorran tax resident?

Under Llei 5/2014, an individual is tax resident in Andorra if either test is met:

• Physically present in Andorra for 183 or more days in the calendar year
• Maintaining the centre of economic interests in Andorra (primary business activity or investments)

Residents pay IRPF on worldwide income. Non-residents are taxed only on Andorran-source income. The two tests apply independently — meeting either one establishes residency.

Andorra offers five residency-by-investment categories: active residency (work), passive residency (investment — minimum EUR 600,000 investment or EUR 50,000 deposit with the Andorran National Institute of Finance), passive residency for non-working pensioners, residency without economic activity for those with proven independent income, and residency for international athletes. Residency is significantly more accessible than Andorran nationality, which requires 20 years of continuous residency.

What are the personal income tax rates?

Andorra's IRPF uses three brackets introduced in 2015 as part of OECD-compliance reform:

Investment income (rendiments de capital) is taxed at a flat 10%. Capital gains are taxed at a flat 10% with exemptions for first-residence disposals and share sales held more than ten years. Joint-filing thresholds are doubled, benefiting married couples.

How does corporate tax work?

Andorra's Impost sobre Societats (IS) charges a flat 10% on corporate net profits — one of the lowest standard corporate rates in Europe. The rate applies to resident companies on worldwide income and to non-resident entities on Andorran-source income.

Withholding on dividends paid to non-resident shareholders is 0% under current IS rules, making Andorra attractive for holding structures. Pillar Two adoption is pending under the EU Association Agreement framework and the Andorran legislative cycle for 2024–2025. Tax losses may be carried forward for 10 years.

What about IGI and other indirect taxes?

Andorra's Impost General Indirecte (IGI) is the VAT-equivalent at a standard 4.5% rate under Llei 11/2012 — the lowest standard VAT-equivalent rate in Europe. Andorra's small-economy simplified registration threshold is EUR 40,000 in annual turnover.

Andorra has no inheritance tax, which is a notable contrast with most European jurisdictions. The Impost sobre les Plusvàlues Immobiliàries (IPI) applies to real estate transfer gains on a sliding scale from 1% to 15% depending on holding period.

How are cryptoassets taxed?

Andorra enacted dedicated cryptoasset legislation under Llei 24/2022 effective 2023, establishing a Digital Asset Service Provider (DASP) framework. Capital gains from cryptoasset disposals fall under the existing 10% flat capital-gains framework within IRPF. The Autoritat Financera Andorrana (AFA) regulates digital-asset service providers.

What is the treaty network?

Andorra has approximately 13 active double tax agreements. Its two most economically significant partners are France (2013) and Spain (2015) — the countries that physically surround the microstate. The MLI was ratified by Andorra in 2018. There is no US–Andorra DTA.

For residents with US income or US nationality, the absence of a US–Andorra DTA means relying on US Foreign Tax Credit (FTC) mechanisms to avoid double taxation. The treaty network is growing slowly but remains smaller than most Western European jurisdictions.

Where does Andorra sit in the European cohort?

Andorra anchors the European microstate low-tax cohort alongside Monaco, San Marino, and Liechtenstein. The broader European low-tax landscape splits into five distinct archetypes:

Common pitfalls for foreigners

Andorra's low-tax reputation attracts high-net-worth relocators, but the jurisdiction carries specific compliance risks that catch newcomers:

When should you talk to an Andorran Tax-Adviser?

The Departament de Tributs portal handles straightforward cases. These situations warrant engaging a qualified economista or asesor fiscal registered with the Col·legi d'Economistes d'Andorra:

• Your income crosses EUR 24,000 (entering the 5% band) or EUR 40,000 (entering the 10% band)
• You are applying for any of the five residency-by-investment categories
• You hold assets or income in countries with no DTA with Andorra (including the US)
• Your company operates under the IS reduced-rate regime (2% or 5%) and must demonstrate qualifying-investment conditions
• You are assessing the impact of Pillar Two transitional rules on a multinational group structure
• You hold cryptoassets and need to report DASP-framework or capital-gains obligations under Llei 24/2022
• You received a notice from the Departament de Tributs regarding an assessment or information request
• You are exiting Andorra residency and need to determine exit-tax treatment in Andorra and your destination country

You can find vetted Andorra practitioners through the directory below.

This page is general information. It is not personal guidance for your specific situation. Tax rules change. Always verify current figures with the Departament de Tributs website or a licensed Andorran Tax-Adviser before filing.