Frequently Asked Questions
Is Andorra still a tax haven?
Andorra is not a tax haven.
As of 2010, Andorra executed twelve agreements for exchange tax information upon demand. When the OECD realized that all the agreements were in force, they decided to release Andorra from the grey list. In 2014, Andorra assumed the international consensus of automatically exchanging financial information to the country of residence of foreign people with financial accounts in Andorra (commonly known as C.R.S. or “Common Reporting Standard”).
European Union as an institution excluded Andorra from the lists of tax havens in 2019.
Does Andorra tax foreign income?
Foreign income arising from investments in financial assets is free of taxes in Andorra. Only certain income arising from real estate leasing, capital gains or business activities conducted in Andorra by foreigners could be taxed.
Is Andorra a tax-free country?
No, Andorra has a tax system implemented in 2011 for freelancers and businesses and in 2016 for individuals. The system consists of direct taxation of the rents and capital gains arising from specific categories.
The tax rate for individuals is 10% and for companies 10%. The indirect tax (called I.G.I.) is 4,5% with certain special rates.
How do I become a tax resident in Andorra?
You can become a tax resident in Andorra by getting the corresponding license that in summary could be: (i) Residence permit without a permit to work; (ii) Residence permit and permit to work for your account; (iii) Residence Permit and permit to work as an employee of another company or individual.
However, the residence does not mean tax residency. The tax residency requires more things than a simple permit.