Accounting services in Andorra

Doing accounting in Andorra is a tedious process that is best left to the experts, such as MCA Assessors. And the Principality attracts a large number of companies and professionals thanks to its favorable legislation regarding tax matter refers. It is important to keep everything related to the accounting of your company or business up to date to avoid problems with the Andorran tax authorities.

Tax accounting process in Andorra

Thelack of knowledge and experience regarding Andorran tax legislation means that many companies and businesses seek advice in Andorra. Not having advice can not only be a problem in terms of tax matters, but it can also prevent the benefits of a company from being fully capitalized. 

If you are looking for advice in Andorra, then MCA Assessors is your best alternative. We offer you accounting services that not only allow you to save time and money, as well as headaches, but also guarantee proper compliance with tax legislation. 

Broadly speaking, tax planning in Andorra follows a similar pattern to that of Spain. Although some processes are different, it can be said that what applies to Spanish accounting is also valid for the Principality. 

The first thing you have to know is that accounting in Andorra is responsible for keeping an accurate and faithful historical record of all the operations that a company carries out. In addition, accounting also has the function of classifying all these operations correctly and in accordance with the law. Why is it a good idea to leave the accounting of your company, company or business in the hands of experts?

• It allows you to have exact control of the debts that the company has, as well as what other companies and people owe it.
• Control expenses and investments. 
• Being able to know, in detail, how much you win and how much you lose. 
• Organized accounting allows you to obtain loans and subsidies. 
• Make a comparison between specific years and periods. 
• Allows you to make future projections for the company.

Accounting in Andorra has its foundations in three basic pillars that include the record of operations carried out by the company, the knowledge of the assets and the calculation of the results of the activity. 

Who should stick to accounting in Andorra?

Who is subject to following the different accounting processes in Andorra? According to article 70 of the law 20/ 2007of October 18, the administrators of Andorran companies are obliged to keep orderly and adequate accounting. These must always follow the parameters and principles established in the accounting legislation of the Principality. 

But also, law 30/2007 of December 20, determines that accounting in Andorra must be orderlyand appropriate to society. That is, it must take into account the nature and dimension of the registered activity. 

According to theAndorran regulations, they are subject to the accounting regime:

• Natural persons who carry out professional or business activities. 
• Commercial companies, as well as other legal entities. 
• Entities that are an economic unit or separate assets, as long as they carry out professional or business activities. Civil societies and UTEs, among others, are welcomed here.

It is important to note that according to the regulations, the accounting must be kept by the entrepreneur, but he or she can leave it in the hands of qualified and authorized personnel strong>, without prejudice to their responsibility. 

On the other hand, you should know that, according to Andorran law, the companies required to keep accounts and declare taxes are those that are established as Societat Anonima (SA), Societat Anonima Unipersonal (SAU; they are constituted as Societat Limitada (SL) or Societat Limitada Unipersonal (SLU). Companies that do not meet these criteria are not obliged to file taxes.

What requirements must accounting in Andorra meet?

Every businessman must accept the provisions of Law 30/2007 of December 20, a regulation that marked a before and after in Andorran accounting. It was precisely in this legal provision that the obligation to have accounting books was included, as well as the principles to be able to prepare the annual accounts of the company. Since its entry into force in 2009, this law has been modified and supplemented. 

On the other hand, we find the general accounting plan in Andorra. This plan, in conjunction with other laws, establishes the relevant criteria that an entrepreneur must meet. These criteria are:

• Accounting documents in Andorra must be clear and must be ordered by date. They also cannot contain whitespace or interpolation. 
• The accounting entries of a company, as well as elements that make up the annual accounts, must have the euro as their reference currency.
• Entrepreneurs must keep all documents for six years. This includes invoices, bank statements, contracts, etc.
• Although accounting is confidential, there may be certain cases in which it is required by the authorities. 

What happens if taxes are not filed correctly?

In Andorra you may be subject to a fine when data is hidden or for the use of fraudulent means. From these two actions various assumptions arise that influence the seriousness of the sanction and the amountof the fine that must be paid.

It is said that there is a infringement when tax returns are not presented to the Treasury or when false data are presented. You may also be subject to a penalty if non-existent operations are shown or when operations that have been carried out are not declared. 

The different types of fines in the Treasury

In Andorra, fines before the tax authorities are classified according to their severity and through three different levels (mild, serious and very serious):

• Mild. A minor infraction is considered when the base of the sanction is less than 3,000 euros or when it is greater than that figure, but has not been hidden. The penalty is 50% of the amount not paid.
• Serious. They appear when the base of the penalty is greater than 3,000 euros and when there is incorrect accounting. It is also considered a serious violation when the impact on the debt ranges between 10 and 50% of the base of the sanction. An infraction is classified as serious if false invoices or documents are provided (if the figure does not exceed 10% of the base of the sanction) and when amounts are withheld. , but with an amount less than 50%. The penalty can range between 50 and 100% of the amount.
• Very serious. This type of infractions appears when the amounts withheld exceed 50% of the base of the sanction and when fraudulent means are used. The penalty is estimated between 100 and 150% of the amount evaded.