Tax in Andorra

Andorra boasts a tax structure that's extremely attractive to foreign investors from all around the globe. Historically considered a tax haven, we're still very much a “tax friendly” country. The key difference is that we're now fully homologated by the OECD.
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Whether you’re an entrepreneur, businessman, rentier or athlete, MCA Assessors will help you to plan the best structure to optimise your personal or/and company taxation. Our team is equipped with an in-depth knowledge of Andorran tax regulations and signed international treaties.

Our accountants will also assist you in complying with all the necessary tax obligations that need to be fulfilled. On your behalf, we’ll submit all mandatory tax reports on direct and indirect taxes, such as company tax, personal tax, VAT, etc.

Due to our long-standing experience and in-depth knowledge, we have strong relationships and connections with the tax officials in Andorra. This makes even the most complex scenarios easily solvable. We've outlined the basics of Andorra's tax system below. Should you need more information please feel free to reach out to us.

View of Main Street in downtown Escaldes-Engordany

Income Tax System in Andorra

Until the 1st of January 2015, Andorra didn’t have provisions for individual income tax. Only after being compelled to do so by the European Union, did the principality begin taxing residents on their income. Annual income tax in Andorra ranges from:

0% for €0 to €24,000 

5% for €24,001 to €40,000 

10% for anything above €40,000 

Dividends from Andorran companies are not
taxable (provided you are a resident). There are also other exemptions, which you'll find on the official list. There is no inheritance tax, however income earned on investments and savings is only tax-free for the first €3,000, thereafter you pay 10%.

Taxation for Legal Entities

Known as “Impost de societats” or just IS, the Andorran corporate tax rate is a flat 10%. However, this is reduced to 5% if a business shows less than €100,000 in profits during the first three years.

Companies that are resident in Andorra are taxed on their worldwide income, whereas non-resident businesses are only liable for tax on income derived within Andorra's borders.

Holding companies with investments abroad pay only 2% tax on profits, while OICs (known as SICAVs in the rest of Europe) incur no tax whatsoever.

Capital gains tax is levied at a flat rate of 10% for both companies and individuals. However, there are ways to reduce this to zero percent. Get in touch with us to find out more.

Business district in Andorra

Get the Best Solution!

Do you need more information about Andorra's tax system? Perhaps you'd like some help with forming a company. Reach out and give us a call! We’re happy to help.