As a specialist in international wealth structuring, I have observed a remarkable phenomenon in recent years: Andorra is increasingly attracting European entrepreneurs and family offices. And for good reason! This small Pyrenean principality has successfully transformed its tax system to become one of Europe’s most attractive jurisdictions for holding companies.

What is immediately striking is the unique combination Andorra offers: an effective tax rate that can be as low as 0% for certain structures, particularly light substance requirements, and above all, full compliance with international standards. Gone are the days when tax optimisation rhymed with grey areas!

For family fortunes and entrepreneurs managing between 1 and 50 million euros, Andorra today presents opportunities that even traditional centres like Switzerland or Luxembourg struggle to match.

Why Andorra is Revolutionising Holding Company Taxation

A Particularly Clever Two-Tier System

One of the main strengths of the Andorran system lies in its apparent simplicity, which actually conceals remarkable sophistication. The authorities have established two distinct regimes, allowing each investor to choose the structure best suited to their situation.

On the one hand, we have the standard regime with a corporate tax rate of 10%. Already very competitive by European standards, this rate applies to all worldwide profits. But it is the second regime that truly makes the difference: the famous STVE regime.

This Société de Tenue de Valeurs à l’Étranger (Company for Holding Foreign Securities) represents a genuine fiscal innovation. Designed specifically for financial holdings, it allows for an effective tax rate of 0% on qualifying income. When my clients discover this possibility, their first reaction is often disbelief. Yet, it is very real and perfectly legal.

Concrete Tax Advantages That Make the Difference

Let’s talk numbers and concrete situations. Under the STVE regime, incoming dividends are not subject to any taxation. Imagine a French entrepreneur who has sold their business and wishes to reinvest the proceeds: by structuring through an Andorran holding company, the dividends from their new investments are simply not taxed.

Regarding distributions, the same logic applies: no withholding tax, regardless of the destination of the funds. This rule applies universally, which is rare in the international tax landscape.

Capital gains also benefit from favourable treatment. Under certain conditions, particularly for participations held as part of a wealth strategy, the exemption can be total.

As for intellectual property, Andorra offers a deduction of up to 80%, bringing the effective rate down to just 2%. For entrepreneurs in the technology or creative sectors, this is a considerable advantage.

Competitiveness That Pales in Comparison to the Competition

To put these advantages into perspective, I like to compare Andorra with traditional jurisdictions that my clients are familiar with:

This table clearly reveals Andorra’s tax advantage. Admittedly, the treaty network remains more limited, but for investments concentrated in Europe, this limitation becomes negligible.

Legal Structures: Simplicity and Flexibility

Two Vehicles, Two Philosophies

Andorra has opted for simplicity by primarily offering two types of structures for holding companies.

The Societat Limitada, or S.L. (Limited Liability Company), is the preferred option for most of my entrepreneurial clients. With a minimum capital of only €3,000, it offers remarkable administrative simplicity and reduced costs. The S.L.U. (single-member) variant is perfectly suited for family structures or individual entrepreneurs.

For larger structures or those requiring enhanced confidentiality, the Societat Anònima (S.A.) (Public Limited Company) is the natural choice. Its minimum capital of €60,000 remains accessible, and it offers increased flexibility for complex arrangements.

Economic Substance: A Model of Pragmatism

One of the aspects most appreciated by my clients concerns economic substance requirements. Unlike the Netherlands, which imposes significant salary constraints (€100,000 minimum), or other jurisdictions with sometimes Kafkaesque requirements, Andorra demonstrates refreshing pragmatism.

An office of 20 m² is more than sufficient. The required Andorran employee can perfectly well be shared with other activities, and no salary threshold is imposed. This balanced approach allows for compliance with international standards without creating disproportionate burdens.

The Practical Reality of Incorporation

A Well-Established and Predictable Process

Having assisted with dozens of Andorran holding company incorporations, I can affirm that the process has become remarkably smooth. The 2 to 3-month timeline may seem long, but it includes all necessary verifications.

The first step, reserving the name, takes only 10 days. Then comes the foreign investment authorisation, necessary when non-resident participation exceeds 10%. This phase generally takes 2 to 4 weeks.

Opening the bank account, a crucial step, takes place concurrently and also requires 2 to 4 weeks. Andorran banks have significantly professionalised their processes for international holding companies.

The final formalities (notarisation, registration, tax permits) are generally completed in 5 to 6 weeks.

Why Family Offices Favour Andorra

Optimal Wealth Protection

In my experience advising wealthy families, confidentiality remains a major concern. Andorra excels in this regard: shareholder information does not appear in any public register, unlike in many other European jurisdictions.

The complete absence of inheritance taxes is another major asset. No inheritance tax, no wealth tax, no gift taxes. This situation allows for particularly effective long-term wealth planning.

The exemption of capital gains after 10 years of holding for participations exceeding 25% fits perfectly into a long-term family holding strategy. This is exactly the type of measure that allows wealth to be built sustainably.

Simplified Management of International Assets

Andorra offers the considerable advantage of having no restrictions on asset classes. Whether it’s listed shares, real estate, alternative investments, or private equity, everything is possible.

The stability of the euro eliminates exchange rate risk for European investors, while the geographical position between France and Spain facilitates operational management.

The network of 16 double taxation agreements, although still limited, covers the main European investment countries and continues to expand gradually.

Who Can Truly Benefit from These Advantages?

The Winning Profiles

Throughout my consultations, certain investor profiles clearly stand out.

Post-exit entrepreneurs form the first group. After selling their company, they often have significant liquidity that they wish to reinvest optimally. Andorra offers them this possibility with remarkable tax efficiency.

Family offices typically manage assets of 50 to 500 million euros. For them, tax optimisation is a major issue, and Andorra often constitutes the most effective solution for predominantly European assets.

Owners of international companies also find it advantageous, particularly for centralising their European operations in a favourable tax environment.

Finally, nomadic entrepreneurs, without a fixed tax residence, appreciate the possibility of establishing an international structure perfectly compliant with current standards.

Practical Thresholds to Know

For an entry-level, I generally recommend annual dividend flows of at least 1 to 5 million euros. Below this, tax savings do not always justify the additional complexity.

The optimal range is between 5 and 50 million euros of managed assets. At this level, the efficiency of the Andorran structure becomes truly significant.

Beyond 50 to 100 million euros, we enter the realm of structured family offices, where Andorra can play a central role in the overall wealth architecture.

Recent Developments: Compliance and Modernisation

The 2024 Reforms: Controlled Strengthening

Law 5/2023, which came into force at the beginning of this year, introduced some important adjustments. These modifications demonstrate Andorra’s commitment to staying in line with international standards.

CFC (Controlled Foreign Companies) rules now require real substance for foreign subsidiaries. This measure, far from being restrictive, simply formalises the good practices we already recommended.

The minimum effective rate of 3%, even for STVE structures, acts as a safeguard against excessive optimisation. In practice, it rarely affects well-designed structures.

Interest deduction limitations (30% of operating profit) primarily target optimisation schemes through indebtedness. For classic holding companies, the impact remains marginal.

Exemplary International Compliance

Andorra has invested considerably in its international compliance. The full implementation of CRS since 2017 ensures automatic exchange of information with over 126 jurisdictions.

Country-by-country reporting works perfectly, and the ratification of the MLI in January 2023 automatically modernises many tax treaties.

This proactive approach places Andorra at the forefront of the most transparent jurisdictions, eliminating any reputational risk for investors.

The Future: The Association Agreement with the EU

A Historic Turning Point in Preparation

The Association Agreement with the European Union, with a referendum expected in 2025, represents a major turning point for Andorra. This agreement promises progressive integration into the European financial services market.

For holding companies, the expected benefits are considerable: facilitation of cross-border operations, mutual recognition of legal structures, and above all, maintenance of current tax advantages.

This development will further enhance Andorra’s attractiveness by combining the advantages of an optimised jurisdiction with privileged access to the European market.

When Andorra Becomes the Obvious Choice

In my daily practice, Andorra naturally imposes itself for certain investor profiles.

For predominantly European assets, it is often the most effective solution. The stability of the euro, geographical and cultural proximity, as well as tax advantages, create a perfect synergy.

Investors prioritising efficiency over notoriety find excellent value for money in Andorra. Unlike Switzerland, where prestige comes at a cost, Andorra offers pure efficiency.

For simple family structures requiring minimal compliance, Andorra avoids the excessive bureaucracy of other jurisdictions.

Finally, for multi-generational wealth planning, Andorran tax advantages (no inheritance taxes, long-term capital gains exemption) create an ideal environment.

Conclusion

After fifteen years of advising on international wealth structuring, I can affirm that Andorra today represents one of the most interesting opportunities in the European market.

This principality has successfully reinvented its economic model by creating a remarkably efficient fiscal ecosystem. The effective taxation of 0 to 10%, lightened substance requirements, and full international compliance constitute a unique combination in Europe.

Admittedly, the network of tax treaties remains more limited than that of Luxembourg or the Netherlands. But for European investors, this limitation is becoming increasingly theoretical.

Andorra has found its positioning: offering European entrepreneurs and family offices maximum tax efficiency within a perfectly compliant framework. For assets of 1 to 50 million euros, this is currently the solution I recommend most frequently.

The association agreement with the EU will only reinforce this attractiveness by combining current advantages with privileged access to the European market. We are very likely witnessing the birth of the new European financial centre.

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The Principality of Andorra offers one of the most advantageous tax regimes in Europe, with tax rates capped at 10%. For entrepreneurs and high-net-worth individuals looking to optimize their tax situation, this small country nestled between France and Spain represents a legal and attractive alternative to traditional tax systems. Discover how the Andorran system can significantly reduce your tax burden, the practical steps to establish your residence there, and why more and more entrepreneurs are choosing this fiscally advantageous destination.

The Andorran Tax System: Considerable Advantages

The Andorran tax system has undergone a major transformation since 2011, evolving from a regime almost exclusively based on indirect taxation to a more comprehensive framework incorporating direct taxation, while maintaining its competitiveness.

Exceptionally Favorable Income Tax

Personal income tax (IRPF) in Andorra has a progressive structure but is particularly advantageous:

• 0% on income up to €24,000
• 5% on the bracket between €24,001 and €40,000
• Maximum 10% on income exceeding €40,000

This system creates a considerable tax advantage compared to neighboring countries. For example, a person earning €60,000 annually in Andorra will pay only €2,800 in tax (effective rate of 4.67%), whereas the same person would pay between €15,000 and €20,000 in Spain (25-33%) or more than €20,000 in France (over 33%).

Very Competitive Corporate Tax

Andorran corporate tax is distinguished by a fixed rate of 10%, much lower than those applied in neighboring countries such as Spain (25%) or France (33.3%). Specific advantages include:

• 50% reduction in the first year (effective rate of 5%)
• Rate of 5% on the first €50,000 of profits for new entrepreneurs
• “Patent Box” regime allowing an effective rate of 2% for intellectual property exploitation
• No limitation on loss carryforwards (up to 10 years)
• New tax credits introduced in 2024 to promote digitalization

One of the Lowest VAT Rates in Europe

Andorran VAT (IGI – Impost General Indirecte) is characterized by exceptionally low rates:

• Standard rate: 4.5% (the lowest in Europe)
• Reduced rate: 1% (food, books, medicines)
• Super-reduced rate: 0% (health services, education)
• Special rate: 2.5% (transport, artistic and cultural services)

This advantageous structure contrasts sharply with neighboring countries (Spain: 21%, France: 20%), making Andorra a popular destination for shopping.

Andorra’s Competitive Advantages Compared to Other Low-Tax Jurisdictions

Andorra presents several major assets compared to other fiscally advantageous destinations such as Monaco, Switzerland, or Luxembourg.

Comparison with Monaco

• Cost of living: 77% cheaper than Monaco
• Residence requirements: More accessible program with lower financial requirements (approximately €52,000 compared to more than a million in Monaco)
• Corporate tax: 10% in Andorra versus 25% in Monaco

Comparison with Switzerland

• Income tax: Maximum 10% in Andorra versus 22-40% in Switzerland depending on the canton
• VAT: 4.5% in Andorra versus 7.7% in Switzerland
• Cost of living: 43% lower than in Switzerland

Quality of Life Factors

Andorra is not limited to its tax advantages; the country offers:

• A healthcare system ranked among the best in the world
• A life expectancy of 83.5 years (among the highest in the world)
• Extremely low crime rates
• 300+ days of sunshine per year
• Modern infrastructure with a fiber optic network covering the entire country
• Proximity to major European cities (Barcelona 2.5 hours away, Toulouse 3 hours)

Practical Steps to Establish Tax Residence in Andorra

Establishing tax residence in Andorra follows a structured process that requires careful planning.

Choose the Appropriate Type of Residence

Two main options are available to applicants:

1. Active Residence: For those planning to work or create a business in Andorra
   • Requires a government deposit of €50,000 (refundable)
   • For entrepreneurs: obligation to hold at least 34% of the shares of an Andorran company
2. Passive Residence: For investors, retirees, or persons with external income
   • Total investment of €600,000 (including a non-interest-bearing deposit of €47,500)
   • €552,500 in approved investments (real estate, financial instruments)
   • Additional deposit of €9,500 per dependent

Detailed Procedure

1. Gather necessary documents:
   • Valid passport
   • Criminal record certificate (issued within the last 3 months)
   • Proof of accommodation in Andorra
   • Medical insurance certificates
   • Financial documents proving solvency
2. Submit the application:
   • Translate all documents into Catalan
   • Submit the application in person at the Immigration Department
   • Pay processing fees (approximately €1,200 for passive residence, €600 for active)
3. Pass the mandatory medical examination
4. Wait for approval (2-4 months depending on the type of residence)
5. Finalize the investment (for passive residence)
6. Receive the residence card and begin the required minimum stay

Conditions and Legal Aspects to Benefit from the Andorran Tax Regime

Minimum Stay Requirements

• Active residence: Minimum 183 days per year in Andorra
• Passive residence: Minimum 90 days per year to maintain administrative status

Important distinction: To become a tax resident, one must generally spend 183+ days in Andorra or have one’s center of economic interests there.

Financial Requirements

• Active residence: Proof of financial self-sufficiency (approximately €38,000-40,000 annual income)
• Passive residence: Income exceeding 300% of the Andorran minimum wage (approximately €40,000)
• Additional 100% of the minimum wage for each dependent

Verifications and Controls

Maintaining resident status is subject to verifications:

• For active residents, police may verify effective residence
• For entrepreneurs, authorities verify actual business activity

Recent Changes in Andorran Tax Legislation

Andorran tax legislation has undergone several major developments between 2023 and 2025:

Law 5/2023 (January 2023)

• Introduction of rules relating to controlled foreign companies (CFCs)
• Limitation of the deductibility of financial charges (30% of operating profit or €500,000)
• Implementation of a minimum effective tax rate of 3% for companies
• Introduction of tax credits for digitalization and patronage

Law 3/2024 (February 2024)

• Establishment of the Foreign Investment in Real Estate Tax (FIRET)
• Progressive rates from 3% to 10% depending on the number of properties
• 90% discount available for investments in the rental market

Development of Tax Treaties

Andorra has significantly expanded its network of tax treaties, now counting 20 agreements signed with various countries, including France, Spain, Portugal, and Luxembourg. Recent developments include:

• Agreement with Lithuania signed in April 2024
• Negotiations concluded with Belgium (May 2023)
• Ratifications approved for Latvia, Montenegro, and Romania (January 2025)

ClickAnd: Your Privileged Partner for Tax Optimization in Andorra

To efficiently navigate the process of establishing tax residence in Andorra, ClickAnd offers a complete range of services adapted to entrepreneurs and high-net-worth individuals.

Comprehensive Expertise in Tax Optimization

ClickAnd offers comprehensive tax advisory services allowing clients to take full advantage of Andorra’s favorable tax regime:

• Personalized tax optimization strategies
• Income tax declaration and planning
• Corporate tax optimization
• International tax planning
• Assistance with IGI compliance (Andorran equivalent of VAT)

Tailored Support for Your Relocation

ClickAnd’s team of experts guides you through each step of the relocation process:

• Initial consultation to understand your specific needs
• Development of a personalized strategy
• Assistance with preparing necessary documents
• Support for administrative procedures
• Assistance with practical aspects of relocation

Turnkey Business Creation Services

ClickAnd offers complete support for establishing businesses in Andorra:

• Business registration and incorporation
• Advice on choosing the appropriate legal structure
• Assistance with administrative requirements
• Support for obtaining necessary permits
• Introduction to banking services and assistance with opening accounts

Located in the heart of Andorra in Escaldes-Engordany, ClickAnd combines tax expertise, deep knowledge of administrative procedures, and a personalized approach to facilitate your transition to this advantageous tax regime.

Conclusion: Andorra, a Strategic Choice for Tax Optimization

With income tax capped at 10%, corporate tax at 10%, the lowest VAT in Europe at 4.5%, the absence of wealth or inheritance taxes, and favorable treatment of investment income, Andorra presents one of the most attractive tax regimes in Europe.

Recent legislative developments demonstrate Andorra’s commitment to maintaining a competitive tax environment while respecting international standards. The growing network of tax treaties and economic diversification initiatives further enhance its appeal.

To fully exploit these tax advantages, ClickAnd positions itself as your ideal partner, offering the expertise and support necessary for a smooth transition to this recognized tax haven. Contact them today to initiate your tax optimization project in Andorra.

The global eSports market is experiencing explosive growth, transforming digital entertainment into a major global industry. Valued at $2 billion USD in 2023, this sector is expected to register a compound annual growth rate (CAGR) of over 15% between 2024 and 2032. Other analyses corroborate this trend, indicating a base value of $2.10 billion USD in 2024 and projecting an expansion to $11.15 billion USD by 2034, with a CAGR of 14.01% over the 2025-2034 period.

This global dynamic has not escaped the Principality of Andorra, which has identified eSports as a promising new avenue for economic diversification and international visibility. Aware of the sector’s potential, Andorra has clearly demonstrated its ambition to position itself as a notable player on the eSports scene.

eSports in Andorra, a Strategic Ambition in the Heart of the Pyrenees

This commitment materialized in May 2021 with the presentation of a dedicated strategic plan by the Andorran government. This initial commitment demonstrates a long-term vision and a proactive approach to entering this new economy. Andorra’s engagement in eSports is not merely an adherence to a trend, but a carefully considered and structured approach, supported at the highest level of the state. The combination of a national strategic plan, a specific legislative framework, and the active involvement of economic development agencies demonstrates a coordinated approach, typical of nations seeking to position themselves in emerging markets with high potential.

This article aims to provide a comprehensive analysis of the Andorran eSports ecosystem. Drawing on verified data, it seeks to inform investors, entrepreneurs, industry professionals, and market observers about the initiatives, structures, opportunities, and challenges that characterize the development of eSports in the Principality.

A Strong Political Will: The Strategic and Legal Framework of Andorran eSports

Andorra’s ambition to carve out a prominent place in the eSports universe is built on solid foundations, characterized by a strong political will and the implementation of a specific strategic and legal framework. This structured approach aims to create an environment conducive to the emergence and sustainable development of this innovative sector.

The National Strategic Plan for eSports: A Pioneering Vision

Andorra made headlines by becoming the first country in the world to approve a strategic plan specifically dedicated to electronic sports. This initiative also positions it as the second country in Europe and the fifth worldwide to adopt a law to regulate this rapidly expanding sector.

The main objective of this plan is clear: to make Andorra an international reference in the field of eSports and to build a complete ecosystem, involving all actors in the value chain, both national and international, in order to promote significant economic and social development.

This strategic plan revolves around several major axes, including economy and business, tourism, the organization of competitions, the development of information technology (IT) infrastructure, as well as the legal framework and governance. Key planned actions include encouraging the creation of new companies specialized in eSports, attracting renowned international companies, transforming Andorra into a destination of choice for eSports events, investing in professional training adapted to the sector’s professions, deploying 5G technology throughout the territory, and creating physical infrastructure capable of hosting competitions and large-scale events.

Law 8/2021 on Electronic Sports: An Innovative Legal Framework

Approved in April 2021, the “Llei 8/2021, del 29 d’abril, d’esports electrònics” constitutes the cornerstone of the Andorran system. It aims to establish a safe and protective legal environment for all stakeholders in the sector.

This law comprehensively regulates contractual relationships between professional players and their teams, defines the rights and obligations of clubs, whether professional or amateur, establishes the requirements for organizing eSports competitions and events, specifies the status of players and coaches, and includes provisions relating to safety, the health of participants, and anti-doping measures.

By providing such legal security, Andorra aims to attract investment and promote the professionalization of the sector. The speed with which this legislative and strategic framework has been put in place positions the Principality as a regulatory “early adopter” in Europe. Being the “first country in the world to approve a strategic plan” and “the second in Europe to approve a law” is not trivial. It suggests a desire to gain a competitive advantage by offering a clear and secure framework ahead of other potentially competing nations.

Regulatory and Promotion Bodies: A Structured Governance

Law 8/2021 also provided for the creation of two key entities for the governance of the sector:

• Comissió Andorrana d’Esports Electrònics (Andorran Electronic Sports Commission): Established by Law 8/2021, this commission is composed of representatives from the ministries in charge of economy, sports, and interior. Its functions are multiple: it ensures compliance with legislation, proposes regulatory changes, manages the official registers of professional and non-professional players and technicians, and ensures cooperation with national and international entities in the sector. It is also responsible for developing the strategic plan, based on government proposals.
• Comitè Andorrà de Promoció dels Esports Electrònics (Andorran Committee for the Promotion of Electronic Sports): Also established by Law 8/2021, this committee aims to serve as a platform for permanent dialogue between the main agents and entities in the eSports sector in Andorran territory. Its minimum composition includes representatives of professional clubs, player associations, event organizers, video game developers, as well as entities such as Andorra Telecom.

This dual structure, with a Commission focused on regulation and administrative management, and a Committee dedicated to promotion and dialogue, demonstrates a balanced approach. Through its registration and normative proposal powers, the Commission ensures formal supervision and control of the sector. The Committee, with its broader composition including a variety of private actors, is designed to foster collaboration, sector adherence to strategic orientations, and the co-construction of initiatives.

Table 1: Key Initiatives and Legal Framework for eSports in Andorra

This institutional and legal architecture demonstrates the Principality’s profound commitment to making eSports a vector for growth and innovation.

The Pillars of the Andorran eSports Ecosystem: Key Actors and Organizations

Andorra’s ambition in the field of eSports is taking shape thanks to a network of actors and organizations that, each at their level, contribute to structuring and energizing the sector. From public institutions to private initiatives, including professional associations, this nascent ecosystem already shows signs of specialization and collaboration.

ACA eSports: The Flagship Initiative for Sim Racing and Beyond

The Automòbil Club d’Andorra (ACA) launched ACA eSports, the first structured eSports team in Andorra, initially focused on the high-potential world of virtual motorsports (Sim Racing). This initiative is not limited to high-level competition; it aims to expand to other eSports disciplines and develop a genuine industry. ACA eSports has a main team composed of four drivers and an academy training ten young prospects.

To support its ambitions, ACA eSports inaugurated the ACA eSports Center, the first high-performance training center for e-drivers in Andorra. Located within the Centre Esportiu d’Ordino (CEO), this 300-400 m² space spread over three floors is equipped with state-of-the-art facilities: latest-generation simulators, training and competition areas, a broadcast room, a content creation studio, a performance analysis space, and offices for staff.

The ACA eSports project benefits from the support of major partners, including Andorra Telecom, the banking entity Creand (formerly Crèdit Andorrà), the Comú (municipality) of Andorra la Vella, and the Fédération Internationale de l’Automobile (FIA). The goal stated by Toti Sasplugas, Secretary General of the ACA, is ambitious: to win a world title within three years. To launch this major project, the ACA notably received a grant of €20,000 from the Andorran government in 2022.

Andorra Esports Clúster: Federating to Innovate

The Andorra Esports Clúster is an association that aims to promote and develop the competitiveness of companies in the Andorran sports sector as a whole. With more than 80 members, including sports entities, companies from various horizons, and professionals, this cluster works to foster collaboration, innovation, and growth.

Its objectives include facilitated access to resources (market studies, financing, trade missions), establishing strategic connections with other sports ecosystems and clusters, and increasing the international visibility of the Andorran sports sector.

Since August 2024, the Andorra Esports Clúster has been chaired by Margot Llobera, a recognized former rally-raid driver, bringing a dynamic and experienced figure to its helm. Although the cluster covers all sports, its action can have significant positive repercussions for eSports, fostering synergies between traditional sports and electronic sports.

Associació Andorrana d’Esports Electrònics (AAEE): The Union of eSports Professionals

Founded in late December 2020, the Associació Andorrana d’Esports Electrònics (AAEE) specifically brings together companies and professionals from the eSports sector in Andorra. Its main mission is to help and cooperate with all actors interested in electronic sports, and to position itself as a representative interlocutor for the ecosystem, particularly to facilitate the establishment of new companies.

Manel Guerrero, who is also the CEO of WhatYouPlay, is a key figure in this association, having participated in several round tables as its representative. The AAEE plays an important role in defending the specific interests of eSports actors and in structuring dialogue within the industry.

WhatYouPlay LVA: Organizer of Local Leagues

Directed by Manel Guerrero, WhatYouPlay LVA is an Andorran company specialized in organizing professional and amateur eSports competitions. It is notably behind the Andorra Video Games League (LVA), a platform designed to allow local players to demonstrate their talents.

WhatYouPlay organizes tournaments on a variety of popular games such as Fortnite, Brawl Stars, FIFA, Clash Royale, Marvel Snap, and Rocket League. Manel Guerrero is also associated with the JOB AND PLAY initiatives, which organize team-building activities with electronic games, and the For2Play application, a token management platform based on players’ skills. These activities help energize the local competitive scene and engage the player community.

The emergence of these different entities sketches an Andorran eSports landscape that, although young, shows early signs of specialization. This structuring is an indicator of the will to cover all aspects necessary for the development of a sector: participants and competitions, representation and collaboration bodies, and strong institutional support.

Table 2: Main Actors in the Andorran eSports Ecosystem

This panorama illustrates the nascent richness and diversity of stakeholders shaping the future of eSports in Andorra.

Andorra, Host for eSports Events: From Local to International

Andorra’s strategy to position itself on the global eSports map inevitably involves organizing and hosting events capable of attracting players, spectators, media, and investors. The Principality has already demonstrated its ability to organize events of various scales, ranging from public festivals to more targeted international competitions, as well as professional meetings focused on innovation.

eSports City Fest Andorra: The Annual Showcase

eSports City Fest Andorra has quickly established itself as the flagship event of the Andorran eSports scene. Designed as a festival mixing electronic games, technology, and entertainment, it targets both enthusiasts and a broader audience. After a notable first edition on May 20-21, 2023, at the Sports Center of Andorra la Vella, a second edition was held in July 2024.

These events have featured competitions on popular games such as Clash Royale, Fortnite, Rocket League, and Marvel Snap, even offering qualifications for international finals like those of DreamHack Valencia.

The impact of eSports City Fest is notable: more than 250,000 people reportedly followed its competitions, helping to consolidate Andorra’s image as a reference destination in the sector.

Esports City Fest: Andorra Invitational (Brawl Stars)

As part of the eSports City Fest, Andorra hosted international caliber tournaments. The ECF Andorra Invitational for Brawl Stars, which saw the eight best teams from the EMEA region (Europe, Middle East, Africa) compete, took place from May 31 to July 27, 2024, at the Congress Center of Andorra la Vella.

With a prize pool of $10,000 USD, this tournament attracted renowned teams such as SK Gaming, ZETA DIVISION, and Totem Esports. Although no Andorran team was explicitly mentioned among the final participants, the event demonstrated the Principality’s logistical and organizational capacity.

GeoGuessr World Cup Wildcard LAN Qualifier (July 2024)

Still in the wake of eSports City Fest Andorra, the Principality hosted a qualifying stage (Wildcard LAN Qualifier) for the 2024 GeoGuessr World Cup in July 2024. This event, organized by GeoGuessr in partnership with Esports City Fest Andorra, was held at the Congress Center of Andorra la Vella.

It offered a highly coveted spot for the grand final in Stockholm and brought together seven high-level invited players as well as one qualifier from the audience present at the festival. Andorra’s association with a world competition for such an innovative and popular game as GeoGuessr reinforces its image as a dynamic eSports destination open to the diversity of practices.

eSports City Talks Andorra: Reflection and Innovation

Beyond competitions, Andorra also seeks to position itself as a place for strategic reflection on the future of eSports. The first edition of eSports City Talks Andorra, organized in February 2024, was sold out.

The objective was to create a catalyst for reflection, discovery, and collaboration, bringing together students, professionals, entrepreneurs, and enthusiasts from various horizons to exchange ideas on innovation in eSports and video games.

Discussions focused on forward-looking themes such as the integration of eSports in urban development and as an economic driver, the disruptive role of blockchain technologies in the sector, and the growing synergies between video games and education.

Internationally renowned speakers from the United States, France, and Spain, including Loren Gold (Greater Raleigh Convention and Visitors Bureau), Edward Tomasi (Subnation), Jean Mariotte (Esports Virtual Arena), Michael Haenisch (Freaks 4U Gaming), and Christoffer Melin (DreamHack festivals), shared their analyses and visions.

Active Participation in International Trade Shows

Andorra’s event strategy is not limited to hosting events on its territory. The Principality, through delegations of local companies, actively participates in major international trade shows and summits. Presences have been noted at the Global Esports Summit (GES) 2023, DreamHack Valencia 2023, the Barcelona Gaming Fair (SAGA), and the 4 Years From Now (4YFN) at the Mobile World Congress in Barcelona.

These participations are an opportunity to present Andorra’s potential in the eSports sector, to highlight game development companies, player associations, and Andorran clubs, and to establish strategic contacts for future partnerships.

Table 3: Selection of Key eSports Events in Andorra and International Participations (2023-2024)

This sustained event activity is an essential pillar of Andorra’s strategy to establish itself as a credible and attractive host for the global eSports community.

Infrastructure and Talent: Building the Future of eSports in the Principality

The development of a sustainable eSports ecosystem relies on two fundamental pillars: quality technological and physical infrastructure, and a pool of talent capable of animating and professionalizing the sector. Andorra has begun to invest in these two areas, although there is room for improvement.

Technological Infrastructure: 5G as a Foundation

Performance in eSports, whether for online competitions, streaming, or the operation of training centers, requires flawless internet connectivity. Aware of this challenge, the Andorran strategic plan includes investments to increase the country’s technological capacity.

The deployment of 5G technology throughout the territory by Andorra Telecom was a project announced for 2022. Although its precise state of progress is not detailed in the consulted documents, the provision of such infrastructure is crucial. At the same time, the creation of an entity dedicated to cybersecurity management has also been planned, an essential aspect to guarantee the integrity of competitions and data protection.

Dedicated Physical Infrastructure: Places to Practice and Compete

While connectivity is virtual, physical venues for local area network (LAN) competitions, training camps (bootcamps), education, and community socialization are equally important.

The ACA eSports Center, inaugurated within the Centre Esportiu d’Ordino (CEO), is the most striking example of infrastructure specifically dedicated to eSports in Andorra. With its 300-400 m² equipped with simulators, a broadcast area, and analysis spaces, it offers a professional setting for the ACA’s Sim Racing team and academy.

Other venues have been occasionally mobilized for major events: the Congress Center of Andorra la Vella hosted the Esports City Fest Andorra Invitational (Brawl Stars) and the qualification for the GeoGuessr World Cup, while the Sports Center of Andorra la Vella served as the venue for the 2023 edition of eSports City Fest.

The national strategic plan explicitly mentions the need to create and implement infrastructure capable of hosting eSports events of different sizes. The Principality also has a large number of quality traditional sports facilities that could be adapted or serve as inspiration for future multi-purpose eSports centers.

Training and Talent Development: Cultivating Tomorrow’s Skills

The sustainability of the Andorran eSports ecosystem will largely depend on its ability to train and retain local talent. The ACA eSports Academy, which supervises ten young prospects in Sim Racing within its training center, constitutes a first concrete initiative in this direction.

The national strategic plan for eSports also includes a component dedicated to investment in professional training, and ACA eSports clearly displays its objective of training a new generation of digital drivers.

Regarding the more general training offer in Andorra, the Planeta Formación y Universidades group lists several Bachelor’s and Master’s programs that, although not exclusively centered on eSports, present obvious links with the sector. These include training in “Sports Management,” “Computing & Digital Technology,” “Desarrollo de Videojuegos y Realidad Virtual” (Video Game Development and Virtual Reality), “Animaciones 3D, Juegos y Entornos Interactivos” (3D Animations, Games, and Interactive Environments), or an “International Master in Sports and Lifestyle Management.”

ACA eSports’ focus on Sim Racing appears to be a judicious strategic choice for Andorra. This discipline capitalizes on the strong culture of motorsports and automobiles present in the Principality and its neighboring regions. Moreover, Sim Racing can offer a more accessible entry point, both financially and logistically, than other major eSports titles to establish a first recognized expertise.

Nevertheless, a careful examination of the training offer in Andorra reveals a current absence of university courses or professional tracks specifically dedicated to the multiple professions of eSports (such as eSports team management, specialized coaching, eSports event organization, marketing and communication in eSports, eSports law, etc.).

Table 4: Key Infrastructure and Training Programs for eSports in Andorra

These elements constitute the foundations on which Andorra can build its future in eSports. The challenge will be to consolidate and complement them, particularly in terms of specialized training, to meet the needs of a constantly evolving sector.

eSports as a Growth Lever: Economic Impact, Investments, and Advantageous Taxation in Andorra

Andorra’s commitment to eSports is not just a matter of prestige or modernity; it is part of a clear strategy of economic diversification aimed at attracting new investments, creating value, and generating jobs. To achieve this, the Principality relies on a favorable regulatory environment, targeted financial support, and an attractive tax regime.

Economic Diversification and Investment Attraction: A Strategic Priority

eSports is identified as a key sector for the diversification of the Andorran economy, traditionally dependent on tourism and commerce. The objective is to attract new markets, stimulate innovation, and create a center of excellence.

The Andorran government, notably through the law on foreign investments, actively encourages the creation of local companies in the field of eSports and seeks to attract international talent and companies. Events such as the Andorra Business Market, although not exclusively dedicated to eSports, testify to the will to connect emerging companies with potential investors, with significant financing capacities (more than 200 million euros mentioned for one edition).

Grants and Financing: Active Support

To realize its ambitions, Andorra has put in place financial support mechanisms:

• Government grants: Grant programs designed to help Andorran companies, across all sectors, become more competitive, innovative, and develop internationally have been established. In 2024, more than 150,000 euros were awarded to 34 companies. Over several years, more than one million euros have been allocated, benefiting nearly 300 companies.
• Specific support for eSports projects: ACA eSports received a government grant of 20,000 euros in 2022 for the launch of its eSports project. This type of direct support for structuring initiatives is a strong signal of the state’s commitment.

Advantageous Taxation: A Major Competitive Asset

Andorran taxation is one of the pillars of its attractiveness for eSports companies and professionals:

• For companies: Corporate tax (IS) is capped at a maximum rate of 10%. Employer social security contributions are also competitive, amounting to about 15%. A notable advantage is that dividends distributed by Andorran companies to shareholders resident in Andorra are exempt from the Personal Income Tax (IRPF). Additionally, the general costs of labor and infrastructure are considered relatively low compared to neighboring countries.
• For individuals (players, professionals): The IRPF is also capped at 10%. It is not applicable for annual incomes below 24,000 euros, and its rate is 5% for the income bracket between 24,000 and 40,000 euros.
• Passive resident status (category C) for high-level athletes: This specific status allows professional athletes, and potentially internationally renowned eSports players, to reside in Andorra without actively practicing a professional activity on the local market. This status is subject to certain conditions, such as an initial investment or deposit, subscription to health, disability, and old-age insurance, proof of a clean criminal record, and a commitment to stay in the Principality for at least 90 days per year.

Andorran taxation, combined with a pleasant living environment, constitutes a strong argument for attracting companies, investors, and individual talents from the world of eSports.

Economic Impact Figures: A Potential to be Quantified for Andorra

While the overall economic potential of eSports is undeniable (global market estimated at $2.1 billion USD in 2024, with a projection of $11.15 billion USD in 2034), specific data regarding the direct impact of eSports on the Andorran economy are still limited.

For example, 885 major eSports events worldwide in 2019 reportedly generated $56.3 million in ticket revenue alone. For Andorra, general economic forecasts indicate an estimated real GDP growth of 1.7% in 2025, but this figure encompasses the entire economy.

Table 5: Support Mechanisms and Economic Advantages for eSports in Andorra

These mechanisms testify to Andorra’s concerted effort to create an economic and fiscal environment conducive to the flourishing of the eSports industry on its territory.

The Gaming Community in Andorra: Between Amateur Passion and Professionalization

The rise of eSports in Andorra is not solely based on institutional strategies and investments; it is also fueled by the passion and commitment of a community of players, ranging from enthusiastic amateurs to budding professionals. The vitality of this community is a key indicator of the sector’s growth potential.

Professional Players and Teams: The Pioneers

The emergence of professional structures is a tangible sign of the maturation of the Andorran eSports ecosystem. ACA eSports stands out as the first clearly identified and structured professional team, with an initial specialization in Sim Racing. The main team is composed of drivers such as Helder Cerqueira, Miguel Marques, Nuno Pereira, and Octavio Pisco.

Law 8/2021 on electronic sports frames this professionalization by regulating the contractual relationships between professional players and their teams, and by defining their activity. This law also provides for the mandatory registration of professional players in an official register managed by the Comissió Andorrana d’Esports Electrònics.

At the same time, the passive resident status of category C, intended for high-level athletes, could prove attractive for internationally renowned professional eSports players wishing to establish themselves in Andorra, similar to athletes from other disciplines such as golfer Victor Dubuisson.

Amateur Clubs and Player Community: The Active Pool

Beyond professionalism, an active community of amateur players is essential. Initiatives such as the Esports City League, of which the Esports City Fest Andorra is a component, aim precisely to bring together these amateurs and offer them a competition experience approaching professional standards.

Public participation is also encouraged at certain events, as evidenced by the open qualification for the GeoGuessr World Cup during the Esports City Fest, allowing an audience member to try their luck for a world competition.

“Video game associations” and “clubs” are mentioned as part of Andorran delegations during participation in international trade shows, suggesting the existence of community structures. WhatYouPlay, with its Andorra Video Games League (LVA), offers a regular platform for local players wishing to compete in an organized setting.

Audience and Enthusiasm: Positive Signals

Interest in eSports in Andorra seems real. The fact that more than 250,000 people reportedly followed the competitions of the eSports City Fest Andorra is a strong indicator of this enthusiasm. Similarly, the first edition of eSports City Talks Andorra was sold out, testifying to an appetite for in-depth discussions on the sector.

The GeoGuessr event, planned at the Congress Center of Andorra la Vella, aimed to attract 3,000 visitors. These figures, although requiring continuous analysis, suggest an audience base and public interest which are key factors for attracting sponsors, investments, and further legitimizing the sector.

The choice of games highlighted during major events in Andorra, such as Brawl Stars (a mobile game) and GeoGuessr (a game accessible to a wide audience), in addition to Sim Racing, is significant. This diversification of targeted titles suggests a potentially broader approach strategy. By reaching mobile player communities and more “casual” or innovative games, Andorra could seek to attract a wider and more diverse audience.

Challenges, Opportunities, and Perspectives: What Future for eSports in Andorra?

As Andorra actively pursues its development strategy in the eSports sector, it is essential to analyze recent dynamics, identify key opportunities to seize, recognize challenges to overcome, and outline future perspectives for this market in full structuring.

Recent Dynamics (2024-2025): A Sector in Motion

The year 2024 was marked by a continuity of efforts. eSports City Fest Andorra, in July, was once again a highlight, notably hosting the ECF Brawl Stars Invitational and a qualification for the GeoGuessr World Cup. Earlier in the year, in February, eSports City Talks brought together experts to discuss the future of the sector.

On the financial front, government grant programs remained active for the years 2024 and 2025, offering continued support to companies. A notable change in the governance of the sports sector is the appointment of Margot Llobera as president of the Andorra Esports Clúster in August 2024, bringing new impetus.

On a broader economic level, GDP growth forecasts for Andorra in 2025 stand at 1.7%, and the government has continued its Digital Transformation program, endowed with 20.6 million euros until 2024, creating a favorable technological environment.

Key Opportunities to Seize

1. Strategic Niche Positioning: Andorra could strengthen its competitive advantage by specializing further in promising niches where it has already laid the groundwork, such as Sim Racing, or by exploring innovative niches such as eSports related to mountain sports (if relevance emerges) or by continuing to focus on mobile games and original concepts that reach a wide audience.
2. Development of eSports Tourism: The strategic plan already identifies tourism as an axis. The challenge is to concretize this vision by developing attractive offers that combine participation in or spectating eSports events with Andorra’s traditional tourist assets (nature, skiing, culture, well-being).
3. Attraction of eSports “Digital Nomads”: The Principality has strong arguments (taxation, quality of life, improving connectivity) to attract professional players, streamers, content creators, or independent game developers seeking a privileged living and working environment.
4. Creation of Specialized Training: To fill the current gap, the creation of courses dedicated to the multiple professions of eSports (management, marketing, events, coaching, data analysis, etc.), in collaboration with the University of Andorra or other training institutions, and drawing inspiration from international models, is a major opportunity to develop qualified local human capital.
5. Valorization of Local Content and Language: Encouraging the creation of eSports content in Catalan and promoting local talent (players, commentators, creators) can strengthen the Andorran eSports identity and the engagement of the local community. Presentations in Catalan during international events have already been noted.

Challenges to Overcome

1. Size of the Local Market: Andorra’s relatively limited population constitutes a structural challenge for the constitution of a large base of local players and a significant domestic audience for events.
2. Intense International Competition: Many countries and metropolises are investing massively in eSports, like France with its 2020-2025 national strategy. Andorra must distinguish itself through a unique offer and flawless execution.
3. Sustainability of Funding: Ensuring the continuity of investments, both public and private, beyond the initial start-up phase is crucial for the long-term viability of projects and infrastructure.
4. Development and Retention of Local Expertise: Training talent in all eSports professions is one thing, retaining them in Andorra by offering attractive career prospects is another.
5. Impact Measurement and Performance Monitoring: The implementation of precise indicators to measure the economic and social impact of eSports in Andorra is essential for steering the strategy and justifying investments.

Future Perspectives

If Andorra manages to capitalize on its opportunities and overcome its challenges, several positive perspectives emerge. The Principality could consolidate its position as a center of excellence for Sim Racing, attracting high-level teams and competitions. It could also become a sought-after location for “bootcamps” and the preparation of international teams, thanks to its infrastructure, living environment, and tranquility.

The continued attraction of medium-sized and niche international events, as well as the emergence of innovative Andorran start-ups in the sector (game development, eSports technologies, specialized services), are also desirable and possible developments.

The long-term success of Andorra’s eSports strategy will fundamentally depend on its ability to transform current initiatives, which are largely driven by institutional actors and a few passionate pioneers, into a truly self-sustaining ecosystem capable of growing organically.

The integration of the eSports strategy into the broader framework of Andorra’s “digital transformation” and its articulation with the potential implications of an association agreement with the European Union are exogenous factors that could significantly amplify or redirect the development of the sector in the coming years.

Andorra and eSports, a Promising Trajectory to be Confirmed

The analysis of the eSports ecosystem in Andorra reveals a Principality resolutely engaged on the path of structuring and developing this future-oriented sector. Driven by a strong political will, materialized by a pioneering strategic plan and a dedicated legal framework, Andorra has laid the necessary foundations for the emergence of a favorable environment. The first specific infrastructure, such as the ACA eSports Center, and an attractive tax regime constitute undeniable assets for attracting talent and investment.

Initial successes are tangible: the organization of large-scale events such as eSports City Fest and its international variations, the holding of strategic conferences such as eSports City Talks, and the establishment of key actors such as ACA eSports testify to a positive dynamic. The active support of the government and the mobilization of professional associations such as the AAEE and the Andorra Esports Clúster contribute to federating energies and professionalizing the sector.

Nevertheless, the promising trajectory of Andorran eSports must still be confirmed in the face of several challenges. The limited size of the local market, fierce international competition, the need to sustain funding, and, above all, the crucial need to develop pointed local expertise in all eSports professions, notably via specialized training courses that are currently embryonic, are all issues to be addressed.

Ultimately, for Andorra to transform its eSports ambition into a sustainable and internationally recognized success, continuous evaluation of actions taken, great strategic adaptability in the face of a constantly changing market, and sustained commitment to transform initial impulses into a mature and self-sustaining ecosystem will be indispensable.

The Principality has laid solid foundations; it now needs to patiently and intelligently build the edifice of its future in eSports. For wise investors, the unique opportunities offered by this growing market deserve careful consideration. For companies in the sector, integrating into this nascent but ambitious ecosystem can prove strategic. As for Andorran public authorities, maintaining the course, supporting the continued structuring of the sector, and investing in human capital will be the keys to long-term success.

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Andorra, a small jewel nestled in the heart of the Pyrenees, is reinventing itself as an ecotourism destination par excellence. With 90% of its territory composed of natural spaces, three protected natural parks including a UNESCO World Heritage site, and exceptional biodiversity, the Principality has all the assets to attract travelers seeking authentic and sustainable experiences. Investors find fertile ground thanks to advantageous taxation (10% corporate tax), global ecotourism market growth estimated at 11-15% per year, and government initiatives favorable to sustainable development. This comprehensive guide explores the potential, assets, investment opportunities, and legislative framework of Andorran ecotourism, a promising sector that diversifies the economy traditionally centered on skiing and shopping.

The Promising Potential of Ecotourism in Andorra

A Rapidly Expanding Market

Ecotourism today represents a major economic opportunity for Andorra. In a country where tourism generates between 30% and 80% of GDP according to different estimates, diversification towards more sustainable tourism constitutes a strategic issue. In 2023, Andorra welcomed a record number of 9.2 million visitors between January and October, an increase of 13% compared to the same period in 2022.

Although specific statistics on ecotourism in Andorra are limited, this segment is estimated to represent approximately 5 to 15% of the country’s total tourism market, potentially representing between 43 and 430 million euros per year. Globally, the ecotourism market was valued between 219 and 260 billion dollars in 2023-2024 and is expected to reach between 428 and 759 billion by 2028-2032, with a compound annual growth rate of 11.7% to 15.2%.

This growth is driven by a significant evolution in traveler expectations: 83% now consider sustainable travel important and 75% plan to travel more sustainably in the coming year.

Solid Future Prospects

The future of ecotourism in Andorra looks promising for several reasons. First, the country’s candidacy to become the first nation entirely recognized as a biosphere reserve by UNESCO could significantly strengthen its image as a leading ecotourism destination.

Cross-border cooperation also represents a significant opportunity. The Sorteny Valley Natural Park is part of the Pyrenean Park of the Three Nations, alongside the Alt Pirineu Natural Park in Catalonia and the Ariège Pyrenees Regional Natural Park in France. This collaboration opens up perspectives for attractive cross-border ecotourism circuits.

Ecotourism also allows Andorra to face one of its greatest challenges: climate change. As a mountainous country, Andorra is particularly vulnerable to climate variations. Temperatures in its high-altitude regions have increased by about 0.17°C per decade, while annual precipitation has decreased by 49 mm. The development of ecotourism represents an adaptation strategy by reducing economic dependence on snow.

Andorra’s Exceptional Natural Assets for Ecotourism

An Exceptional Natural Heritage

Andorra benefits from a remarkable natural heritage that makes it a privileged destination for ecotourism. With an area of 468 km² and an average altitude of 1,996 meters, this mountainous territory offers breathtaking landscapes and exceptional biodiversity.

Andorra’s three major protected natural areas cover approximately 26% of its total area, one of the highest concentrations of protected areas in the world:

The Madriu-Perafita-Claror Valley: Listed as a UNESCO World Heritage site since 2004, this glacial valley extends over 4,247 hectares (about 10% of Andorran territory). It represents an exceptional example of how humans have exploited the resources of the high Pyrenees over millennia, with a communal land ownership system dating back to the 13th century.

The Sorteny Valley Natural Park: Created in 1999, this 1,080-hectare park is distinguished by its exceptional flora richness with more than 800 species of plants and flowers, including 50 species endemic to the Pyrenees. It forms the heart of the Ordino Biosphere Reserve recognized by UNESCO in 2020.

The Comapedrosa Valleys Natural Park: This 1,543-hectare park is home to Andorra’s highest peak, the Comapedrosa peak (2,942 m). Typical alpine flower species and several protected animal species can be found here.

Remarkable Biodiversity

Despite its small size, Andorra is home to exceptional biodiversity that constitutes a major asset for ecotourism:

Flora: More than 1,100 plant species, including the grandalla (Narcissus poeticus), the national emblem, as well as numerous species endemic to the Pyrenees.

Fauna: Andorra is a refuge for many Pyrenean animal species, including the isard (Pyrenean chamois), marmot, fox, ermine, capercaillie, golden eagle, bearded vulture, and Aurelio’s Pyrenean lizard, an endemic species almost exclusive to the Sorteny Natural Park.

Aquatic Environments: The country has around sixty glacial lakes that are home to various ecosystems, particularly river trout populations.

Unique and Accessible Natural Attractions

Andorra possesses several natural assets that distinguish it from other ecotourism destinations:

A Compact Natural Territory: With 90% natural spaces, Andorra offers immediate immersion in nature, even close to urban areas.

Remarkable Accessibility: Natural spaces are easily accessible via a dense network of marked trails (including sections of the GR7 and GR11) and 29 mountain refuges.

Panoramic Viewpoints: Andorra has developed 29 viewpoints offering exceptional panoramas of the Pyrenees, ideal for ecotourism. Among the most spectacular is the Mirador Roc del Quer, a 20-meter-long walkway with 12 meters suspended in the air.

Exceptional Air Quality: The country benefits from some of the purest air in Europe, a considerable asset for tourists seeking healthy environments.

Types of Investment Projects in Andorran Ecotourism

Ecological Accommodations

One of the most promising sectors for ecotourism investment in Andorra concerns sustainable accommodations:

High-end Mountain Refuges: The modernization of existing refuges or the construction of new refuges using local materials and renewable energies offers interesting potential. These structures can target clientele seeking authenticity but not wishing to give up comfort.

Eco-lodges Integrated into the Landscape: These charming accommodations with low environmental impact represent an attractive investment opportunity. They can stand out through the use of sustainable materials, energy autonomy (solar panels, geothermal energy), and sustainable water management.

Sustainable Renovation of Bordas: The transformation of these traditional Andorran rural buildings into ecological accommodations helps preserve the architectural heritage while creating unique accommodation experiences.

Sustainable Tourism Services

The development of ecotourism services represents another promising investment axis:

Specialized Guided Tours: Thematic hikes (botany, fauna, heritage), photography excursions focused on nature, or heritage circuits highlighting local history and culture.

Eco-responsible Outdoor Activities: Wildlife and flora observation, hikes with naturalist guides, wellness activities in nature, or low environmental impact mountain sports.

Digital Discovery Applications: Development of innovative tools for autonomous discovery of Andorran natural heritage, with information on local biodiversity, history, and geology.

Sustainable Gastronomy and Culinary Tourism

Gastronomy represents a promising sector for ecotourism in Andorra:

Eco-gastronomic Restaurants: Valorization of local and seasonal products, short circuits with valley producers, and rediscovery of traditional Andorran recipes.

Immersive Culinary Experiences: Local cooking workshops, gathering and preparation of edible wild plants, or tastings of local products.

Educational Farms: Creation of spaces allowing visitors to discover traditional mountain agriculture and local productions.

Soft Mobility and Connectivity

Ecological transport solutions represent an investment domain with strong potential:

Electric Shuttle Network: Development of clean transport services between tourist sites.

Infrastructure for Electric Bikes: Extension of the Cicland network (shared electric bikes) and creation of new accessible cycling circuits.

Integrated Mobility Applications: Development of digital tools facilitating eco-responsible movement across Andorran territory.

The Legislative Framework and Incentives for Sustainable Investments

Favorable Environmental Legislation

Andorra has progressively developed a solid environmental legislative framework, particularly strengthened in recent years:

Law 21/2018 of September 13 on Energy Transition and Climate Change: This fundamental law aims to drive the transition towards a more sustainable energy model and promote adaptation to climate change in all public policies.

Declaration of the State of Climate and Ecological Emergency (January 23, 2020): Approved by the General Council (Andorran parliament), this declaration tasks the government with driving the transition towards carbon neutrality.

International Commitments: Andorra was among the first States to submit its national contribution to the fight against climate change, with a commitment to reduce greenhouse gas emissions by 37% by 2030.

Attractive Tax Regime

Andorra offers a particularly advantageous tax framework that indirectly benefits investors in ecotourism:

Corporate Tax (IS): General rate of 10%, among the lowest in Europe, with reduced rates for certain specific activities.

Value Added Tax (IGI – General Indirect Tax): Standard rate of 4.5%, the lowest in Europe, with reduced rates for certain products and services.

Personal Income Tax (IRPF): Total exemption up to €24,000 of annual income and maximum rate of 10% for income above €40,000.

Non-double taxation agreements: Agreements signed with several countries (France, Spain, Luxembourg, Portugal, etc.) facilitating cross-border investments.

Government Initiatives for Sustainable Development

The Andorran government has implemented several programs favorable to the development of ecotourism:

ENGEGA Program: Government initiative with a budget of €1 million per year to support the purchase of electric vehicles, applicable to tourism companies for their fleet.

Andorra Sustainable Development Program: Strategic vision based on the three pillars of sustainable development (economy, social, and environment) and integrating the United Nations 2030 Agenda.

National Waste Management Plan: Initial target of 50% recycling exceeded in 2018 (50.4%), creation of sorting centers in each parish.

Adherence to the International Code for the Protection of Tourists (ICPT): In 2024, Andorra became the 25th country to adhere to this code, reaffirming its commitment to responsible and sustainable tourism.

Current Trends and Market Projections for Ecotourism

Evolution of Traveler Expectations

Global tourism trends show a significant evolution in traveler expectations towards more sustainability:

• 83% of travelers consider sustainable travel important
• 53% seek accommodations combining comfort and sustainable features
• 75% plan to travel more sustainably in the following year
• 57% wish to reduce their energy consumption during their next trips

These trends represent a major opportunity for Andorra to position itself as a leading ecotourism destination, capable of meeting the new expectations of travelers seeking authentic and sustainable experiences.

Growth Projections

The global ecotourism market is experiencing remarkable growth:

• Valued between $219.53 and $260.76 billion in 2023-2024
• Projected compound annual growth rate (CAGR) between 11.7% and 15.2%
• Projection to reach between $428 and $759 billion by 2028-2032
• Europe dominates this market with 38.87% market share in 2023

For Andorra, these projections translate into significant growth potential for the ecotourism segment in the coming years, especially if the country succeeds in strengthening its positioning in this market through its candidacy as an integral biosphere reserve and its initiatives in favor of sustainable tourism.

Seasonal Diversification Opportunities

Ecotourism represents a major opportunity for Andorra to reduce its dependence on winter tourism and develop a balanced offer throughout the year:

• Spring/summer activities: Hiking, alpine flora observation, cycle tourism
• Autumn activities: Wildlife observation, gathering, photography of autumn colors
• Winter activities alternative to skiing: Snowshoeing, ski touring, winter observation

This diversification reduces vulnerability to climate change that threatens snow cover at ski resorts, while creating more stable and sustainable jobs in the tourism sector.

Successful Case Studies in Sustainable Ecotourism in Andorra

The Madriu-Perafita-Claror Valley: A Model of Cultural Ecotourism

The Madriu-Perafita-Claror Valley, inscribed on the UNESCO World Heritage List since 2004, represents one of the most emblematic ecotourism projects in Andorra:

• Surface area of 4,247 hectares (about 10% of Andorran territory)
• Exceptional natural heritage: 350 high mountain wetlands, preserved forests
• Millennial cultural heritage: paved paths, shepherd huts, traditional agricultural systems
• Absence of motorized access roads, preserving the authenticity of the site

Ecotourism initiatives include marked hiking circuits, guided tours by local experts, and a participatory management system including local communities. This model demonstrates how to reconcile heritage preservation and sustainable economic development.

Naturland: Eco-responsible Adventure Park

Formerly known as Naturlandia, Naturland is an outdoor activities center that has succeeded in combining economic development and environmental preservation:

• Located between 1,600 and 2,000 meters altitude in the La Rabassa area
• Extends over more than 800 hectares of preserved forest
• Open all year round, offering activities adapted to each season

Ecotourism initiatives include low environmental impact activities, a nature interpretation center, and the use of sustainable materials in infrastructures. This project has created local year-round jobs while raising public awareness about environmental protection.

The Green School Project: Environmental Awareness

Launched in 2010 by the Andorran Center for Sustainability, the Green School project aims to integrate environmental education into the Andorran school system:

• Environmental education program intended for all schools in the country
• Analysis of environmental practices of establishments
• Implementation of specific action plans

In 2023, 53% of Andorran schoolchildren participated in the program, representing more than 200 students engaged in environmental initiatives. This project contributes to creating a generation aware of environmental issues, which will constitute the future clientele and future actors of Andorran ecotourism.

The Challenges and Opportunities of Ecological Investment in Andorra

Challenges to Overcome

Despite its potential, ecotourism in Andorra must overcome several challenges:

Tourism Seasonality: Concentration of visitors during winter and summer seasons, making it difficult to maintain stable year-round employment and the profitability of investments.

Balance Between Development and Preservation: Need to maintain the integrity of ecosystems while allowing visitor access. Tourist pressure on fragile natural spaces represents a major challenge.

Accessibility: Andorra does not have its own international airport, which can limit its accessibility. The nearest airports are in Barcelona, Toulouse, and La Seu d’Urgell.

Professional Training: The development of ecotourism requires a qualified workforce sensitized to environmental issues, a challenge in a small country with limited human resources.

Promising Opportunities

Faced with these challenges, several opportunities present themselves for investors in Andorran ecotourism:

Privileged Geographical Position: Located between France and Spain, Andorra is easily accessible for European ecotourists, a rapidly growing market.

Advantageous Tax Framework: Andorra’s attractive tax regime (10% corporate tax, 4.5% VAT) offers favorable conditions for investors in all sectors, including ecotourism.

Market Differentiation: Andorra, traditionally associated with skiing and shopping, has the opportunity to reposition itself as a premium ecotourism destination, attracting a higher value-added clientele.

Institutional Support: The Andorran government’s commitment to sustainable development creates an environment conducive to ecotourism initiatives.

Advice for Successful Investment in Andorran Ecotourism

Understanding Local Specificities

To succeed in an ecotourism investment in Andorra, it is essential to:

Immerse Yourself in Local Culture: Understand Andorran traditions, history, and way of life to create authentic experiences.

Establish Local Partnerships: Collaborate with local actors (guides, producers, artisans) to enrich the offer and integrate into the local economy.

Respect the Identity of the Territory: Develop projects that value and preserve Andorra’s natural and cultural heritage rather than imposing external concepts.

Mastering Administrative and Legal Aspects

To navigate efficiently in the Andorran administrative environment:

Partner with Local Experts: Call upon professionals who know Andorran legislation well to facilitate procedures.

Plan Necessary Authorizations: Anticipate the timeframes for obtaining permits, particularly for projects near protected areas.

Stay Informed of Regulatory Developments: Follow legislative changes that could impact the ecotourism sector.

Innovate and Differentiate

In a competitive market, innovation is key to success:

Create Unique Experiences: Develop offerings that stand out for their originality and quality, capitalizing on Andorran specificities.

Integrate Sustainable Technologies: Use technological innovations to reduce environmental impact while improving customer experience.

Adopt a Holistic Approach to Sustainability: Integrate environmental, social, and economic aspects into every aspect of the project.

Call on Clickand for Personalized Support

To maximize your chances of success in Andorran ecotourism, Clickand offers comprehensive support to investors:

Expertise in Market Analysis: In-depth studies of the Andorran ecotourism sector, identification of opportunities, and competition analysis.

Specialized Legal Advice: Support in all administrative procedures, obtaining necessary authorizations, and tax optimization.

Business Creation Support: Complete assistance for the constitution of your company in Andorra, from name reservation to obtaining licenses.

Network of Local Partners: Connection with key actors in Andorran ecotourism to develop fruitful synergies.

With its in-depth expertise of the Andorran market and its knowledge of ecotourism issues, Clickand accompanies you at each stage of your investment project, from initial conception to operational implementation.

Conclusion

Ecotourism in Andorra represents an exceptional investment opportunity at the intersection of several strong trends: the growing demand for sustainable tourism, the need for Andorra to diversify its economy in the face of climate change, and the attractiveness of a favorable fiscal and regulatory framework.

The country’s remarkable natural assets, combined with government initiatives in favor of sustainable development, create an environment conducive to the emergence of innovative and profitable ecotourism projects. Successful examples such as the management of the Madriu-Perafita-Claror Valley or the Naturland project demonstrate the viability of this model.

For investors ready to take up the challenges of seasonality and the balance between development and preservation, Andorran ecotourism offers promising prospects for sustainable growth. With the support of experts like Clickand, these projects can contribute to positioning Andorra as a reference ecotourism destination in Europe, while generating significant economic benefits for visionary investors who have seized this opportunity.

Expatriation to Andorra has become a particularly attractive option for French entrepreneurs and professionals looking to optimize their tax situation and improve their quality of life. However, many misconceptions circulate about residency conditions, taxation, and the cost of living in this Pyrenean principality. In this article, we will analyze the most widespread myths and present the reality, so that you can make an informed decision regarding your relocation project to Andorra.

Are France and Andorra so different? What are the real tax advantages? How does the residency application process actually work? Continue reading to discover what really awaits you.

Index:

• Conditions for obtaining residency in Andorra
• The Andorran tax regime compared to the French system
• Business creation: processes and requirements
• Living in Andorra: everyday realities
• Cost of living: misconceptions and concrete facts
• Education and healthcare in the principality
• Transportation and connectivity with France
• Your expatriation project: how to proceed

Conditions for obtaining residency in Andorra

Many people think that obtaining residency in Andorra is a mere formality. Let’s examine the realities of the process for French citizens.

The myth of easy and fast residency

Contrary to the widespread idea, obtaining Andorran residency requires meeting specific requirements and following a rigorous administrative process. For the French, access to the territory is indeed simplified compared to other nationalities, but this does not mean that settlement is automatic.

The two pathways to residency

In Andorra, there are two main categories of residency, each with its own conditions:

• Active residency: intended for people who wish to work or create a business in Andorra. To obtain it, you must own at least 34% of the shares of an Andorran company, exercise a management role, and demonstrate that the company is operational within three months of its creation.
• Passive residency: for those who do not plan to engage in professional activity in the country. It requires proving annual income exceeding 300% of the Andorran minimum wage (plus 100% for each dependent), as well as a minimum investment of 600,000 euros in Andorran assets (real estate, financial instruments, or participation in the capital of local companies).

The physical presence criterion

Another persistent myth concerns the possibility of maintaining your life in France while benefiting from Andorran tax status. The reality is quite different: to be considered a tax resident in Andorra, you must physically stay there for at least 183 days per year (active residency) or 90 days (passive residency). French and Andorran tax authorities work closely together to prevent fraudulent dual tax residency.

The Andorran tax regime compared to the French system

Taxation is often the main motivation for expatriation to Andorra. Let’s see what really distinguishes the two systems.

The “zero tax” myth

Contrary to popular belief, Andorra is not a tax-free paradise. The country has developed a modern tax system aligned with international standards. The major difference lies in the tax rates, which are significantly more advantageous than in France.

Comparison of France-Andorra tax rates

The contrast between the two tax systems is striking:

• Income tax: capped at 10% in Andorra, compared to up to 45% in France
• Corporate tax: 10% in Andorra, compared to 25% (standard rate) in France
• VAT (IGI in Andorra): 4.5% in Andorra, compared to 20% (standard rate) in France
• Social security contributions: considerably reduced in Andorra compared to the French system

Tax agreements between France and Andorra

Since the signing of the bilateral tax agreement in 2015, relations between the two countries have normalized. This agreement effectively prevents double taxation and fights against tax evasion, while providing a clear legal framework for French expatriates in Andorra.

Business creation: processes and requirements

Creating a company in Andorra is often perceived as complex or reserved for the wealthy. Let’s examine the realities of entrepreneurship in the principality.

Investment conditions

To create a limited liability company (SL) in Andorra, a minimum share capital of 3,000 euros is required, which remains comparable to French requirements. However, for public limited companies (SA), the minimum capital rises to 60,000 euros, an amount higher than the 37,000 euros required in France.

The authorization process for French investors

As a French citizen, you will need to obtain a foreign investment authorization before establishing your company. This procedure involves presenting a detailed business plan and proof of a clean criminal record. The processing time generally varies between 4 and 8 weeks, a faster process than in many European countries.

The requirement for real activity

A widespread myth is the ability to create a “shell company” in Andorra. In reality, the authorities require that your company conducts substantial economic activity in the country, with verifiable physical presence and, depending on the structure, the hiring of at least one local employee if the administrator does not reside in Andorra.

Living in Andorra: everyday realities

Beyond the fiscal and administrative aspects, quality of life is a determining factor in the choice of expatriation. Let’s discover daily life in Andorra for a French person.

Cultural offerings and leisure

Contrary to the preconceived idea of a country where “there is nothing to do,” Andorra offers a remarkable quality of life, particularly for nature and sports enthusiasts. The country regularly hosts international cultural events and has modern leisure facilities:

• World-class ski resorts like Grandvalira and Vallnord
• Exceptional networks of hiking trails and cycling paths
• Caldea thermal spa center, the largest in Southern Europe
• Museums, art galleries, and seasonal festivals

Adaptation to the local culture

For a French person, cultural adaptation is facilitated by linguistic proximity (French is widely spoken in addition to Catalan, Spanish, and Portuguese) and cultural similarities. The size of the country also favors integration into an expanding international community.

Cost of living: misconceptions and concrete facts

The idea that “everything is cheaper in Andorra” deserves to be nuanced. Let’s analyze the different aspects of the cost of living compared to France.

Real estate and housing

The Andorran real estate market has experienced a strong increase in recent years, reducing the gap with certain French regions. However, prices per square meter remain on average lower than those in major French cities such as Paris, Lyon, or Nice. A quality apartment in the center of Andorra la Vella costs approximately 30% less than an equivalent property in the center of Nice.

Everyday consumption

While electronic products, fuel, alcohol, and tobacco are significantly cheaper in Andorra thanks to reduced VAT, food products and everyday services show prices similar to those in France. The absence of certain specific French taxes, however, represents substantial savings for households.

Services and insurance

Banking services, insurance, and telecommunications have rates comparable to those in France, sometimes slightly higher due to the limited size of the Andorran market. On the other hand, personal services are generally more affordable.

Education and healthcare in the principality

For French families considering expatriation, education and healthcare issues are paramount. Let’s examine these essential aspects.

The multilingual education system

Andorra offers a unique education system where three systems coexist: Andorran, French, and Spanish. For French families, the possibility of enrolling their children in the French system (up to the baccalaureate) constitutes a considerable advantage, allowing educational continuity without disruption.

Healthcare coverage

The Andorran healthcare system, although private, offers high-quality services. Residents must mandatorily join the Andorran Social Security Fund (CASS), which covers 75% of medical expenses and 100% of hospitalizations. Agreements with France also allow expatriates to benefit from care in France if necessary.

Access to medical infrastructure

The principality has a modern hospital (Hospital Nostra Senyora de Meritxell) and a network of private clinics offering specialized services.

Transportation and connectivity with France

The question of accessibility is often neglected when planning an expatriation. Let’s see how Andorra connects with France.

Road accessibility

Contrary to preconceived ideas, Andorra is not isolated. Located just 2.5 hours from Toulouse and 3 hours from Perpignan by road, the principality is easily accessible year-round. The roads are perfectly maintained, even in winter thanks to an effective snow removal system.

Air transportation

Although Andorra does not have its own international airport, nearby air infrastructure offers excellent connectivity:

• Toulouse-Blagnac Airport: 170 km away (2.5 hours)
• Barcelona-El Prat Airport: 200 km away (3 hours)
• Girona Airport: 200 km away (2.75 hours)

Remote work and digital connectivity

Andorra has one of the most advanced digital infrastructures in Europe, with fiber optic internet coverage across almost the entire territory and connection speeds superior to those available in many French regions, thus facilitating remote work with French partners.

Your expatriation project: how to proceed

After demystifying the main misconceptions about life in Andorra, let’s address the implementation of your expatriation project.

Strategic planning

A successful expatriation requires meticulous preparation. We recommend developing a 6 to 12-month timeline including exploratory visits, housing search, administrative procedures in France (contract termination, declaration of tax residency change) and in Andorra (residency permit application, bank account opening).

Professional support

Given the complexity of administrative and tax procedures, using experts specialized in expatriation to Andorra constitutes a wise investment. These professionals will guide you through each step of the process, helping you avoid costly mistakes and optimizing your relocation.

Contact our experts to implement your project

At Clickand, we have been accompanying French entrepreneurs and professionals in their relocation projects to Andorra for many years. Our multidisciplinary team perfectly masters the specificities of France-Andorra expatriation and offers you a personalized service to implement your project in the best conditions.

For a personalized consultation and answers to all your questions, contact us today. Our experts will help you transform your expatriation project into reality.

I. Introduction

Adopted in early 2025, the legislation commonly known as the “Omnibus Law” represents a significant set of legislative measures for the Principality of Andorra. This law primarily aims to address pressing socio-economic challenges, particularly the housing crisis and the need to more tightly regulate foreign investment in the Andorran real estate sector.

The context of this law is marked by a notable increase in real estate prices, fueled in part by a growing influx of foreign investments attracted by the stability and tax advantages of the Principality. This dynamic has created difficulties in housing access for residents and has raised concerns regarding real estate speculation. Faced with this situation, the Andorran government initially implemented temporary measures, such as a moratorium on foreign real estate investment authorizations in 2023-2024 and the introduction of Law 3/2024 establishing a specific tax on these investments (Tax on Foreign Real Estate Investment – IEI).

The Omnibus Law follows this continuity but represents a more structured and interventionist approach, aiming to ensure sustainable growth and preserve housing access for the local population. Historically, Andorra has favored investment through attractive conditions, but the growing negative externalities have led to this change of direction. The Omnibus Law, with the simultaneous introduction of multiple restrictions and regulations (purchase limitations, vacant housing regime, conversion of tourist accommodations, obligations for foreign developers), marks a fundamental evolution of Andorran policy, now prioritizing residential needs and controlled development over maximizing foreign capital flows in real estate.

This report aims to provide a detailed legal and practical analysis of the key provisions of the 2025 Omnibus Law, examining its specific requirements, implementation timelines, imposed restrictions, as well as its anticipated economic and social impacts and future evolution perspectives.

II. Legislative Timeline: Publication and Entry into Force

The Omnibus Law was adopted by the Consell General, the Andorran parliament, around March 6, 2025. In accordance with Andorran legislative procedure, the text subsequently required the sanction (signature) of the Co-Princes of Andorra before its official publication. This publication occurs in the Butlletí Oficial del Principat d’Andorra (BOPA), the official journal that gives legal force to published texts. Sources indicated that this publication was to take place before March 28, 2025. Although the exact publication references (number and precise date of the BOPA) are not explicitly detailed in the consulted documents, the law’s entry into force date is clearly established.

The Omnibus Law came into force on April 18, 2025. This date corresponds to the expiration of the usual vacatio legis period of 15 days following publication in the BOPA, a period during which the law is published but not yet applicable. It is crucial to note that several major provisions, especially the limitations on foreign real estate investment and modifications related to work permits, took effect from this date.

The relatively tight timeline between the law’s adoption in early March, the expected publication in late March, and the entry into force in mid-April demonstrates a governmental will for rapid implementation. Faced with a situation deemed urgent in the housing market, the authorities sought to minimize the delay between legal finalization and practical application of the measures, aiming for an immediate impact on investment flows and real estate market dynamics, even if it meant surprising some market players.

III. Foreign Real Estate Investment: New Restrictions and Regulations

The Omnibus Law introduces a significantly stricter regulatory framework for foreign investment in Andorran real estate, profoundly modifying the applicable rules.

A. Acquisition Limitations for Foreign Natural Persons

Since April 18, 2025, natural persons considered as foreign investors are subject to strict quantitative limitations when acquiring real estate properties:

• They can only acquire a maximum of two housing units (e.g., apartments, studios) OR a single single-family property (individual house, chalet).
• These acquisitions may include annexes, with specific limits: a maximum of three parking spaces and three storage units associated with the two housing units.
• If parking spaces are acquired independently, the limit is set at six spaces.

It is important to emphasize that real estate properties held by the foreign investor before the law’s entry into force (April 18, 2025) are not taken into account in calculating these new limits.

B. Scope of Application and Definition of “Foreign Investor”

The Omnibus Law redefines and clarifies the notion of foreign investor:

• Non-resident natural persons (except Andorran nationals).
• Resident natural persons (non-nationals) who have not resided in Andorra for at least three of the last ten years. This condition is stricter than the previous rule that required three years of uninterrupted residence.
• Foreign legal entities and foreign public entities.
• Andorran legal entities whose foreign participation (direct or indirect) in the capital or voting rights is equal to or greater than 50%.

A notable modification is the exclusion of Andorran entities with a foreign participation between 5% and 50% from the category of foreign investments subject to the Omnibus Law restrictions. This contrasts with the initial scope of Law 3/2024 (relating to the IEI), which targeted entities with a foreign participation greater than 5%. As the Omnibus Law amends Law 3/2024, it is important to verify whether the scope of the IEI has been aligned with this 50% threshold or if a potential divergence persists, which could create complexity for companies with a foreign participation between 5% and 49%. The latter could be subject to the IEI without being affected by the acquisition limitations of the Omnibus Law.

C. Exemptions and Special Conditions

The acquisition limitations regime includes important exemptions and specific conditions:

• Affordable Rental Housing: Properties acquired by foreign investors and intended for long-term rental (minimum 10 years) as a principal and permanent residence at an affordable price are explicitly exempt from the quantitative limits (2 units / 1 house). A new authorization can be requested after 10 years under the same conditions.
• Commercial Use: The acquisition restrictions do not apply if the real estate property is acquired by a foreign investor (natural or legal person) for the purpose of conducting their own commercial or professional activity there.
• Companies: Foreign companies or Andorran companies with majority foreign participation (>50%) can invest in real estate either to establish their commercial activity there, or if the ownership structure meets specific criteria (held by a single natural person or related parties such as family, partners).
• Prohibited Investments: The law explicitly prohibits certain types of foreign real estate investments:
  • Real estate development intended for resale.
  • Acquisition of housing intended for tourist or vacation use.
  • Certain sale-leaseback arrangements or rentals between related parties considered fraudulent.

Exceptions exist for developments entirely dedicated to long-term rental (of which at least 50% at affordable prices) or located in parishes that have updated their urban planning.

D. Associated Taxation: The Tax on Foreign Real Estate Investment (IEI)

The Omnibus Law also modifies Law 3/2024 that established the IEI. This progressive tax applies to the real value of the acquisition by foreign investors:

• Progressive rates:
  • 3% for the first acquisition (unit or house).
  • 5% for the second acquisition.
  • 8% from the sixth acquisition.
  • 10% from the tenth acquisition or for real estate development/urban planning operations.
• Reduction for Affordable Rental: A tax reduction of 90% on the IEI amount is granted if the acquired property is intended for rental as a principal and permanent residence for a minimum duration of 10 years, at a price considered affordable.
• Recovery Clause (Clawback): If the 10-year affordable rental commitment is not respected (e.g., early sale, rental at market price), the investor is required to reimburse the entire tax from which they had been exempted.

This tax structure reinforces the quantitative limitations. The acquisition of more than two properties becomes not only limited but also fiscally more costly, unless the investment is oriented toward the affordable rental market, which then benefits from a major tax advantage.

E. Obligations for Foreign Real Estate Developments

A distinct and crucial point concerns real estate development operations (development of new projects) carried out by foreign investors. The law appears to impose a general obligation: all real estate developments carried out by foreign investors must be intended for the creation of affordable rental housing. This requirement appears stricter than the limitations applying to individual acquisitions and aligns with the prohibition of developments intended for resale, unless they meet the rental criteria. The acquisition of developments by foreigners is only possible if they are intended for the rental market, with the notable exception of acquisition for commercial activity purposes. This suggests a marked will to channel large foreign development projects directly toward increasing the stock of affordable rental housing.

In summary, the legislation uses a combination of quantitative limitations, progressive taxation, and targeted tax incentives to discourage speculative property accumulation by foreigners and to actively direct foreign capital toward the rental housing segment, particularly affordable rental. The regime appears particularly constraining for foreign real estate developers, whose activity now seems almost exclusively confined to the production of affordable rental housing.

IV. Work Permits: Modifications for Non-EU Subcontracted Workers

The Omnibus Law also introduces significant changes regarding work permits for certain categories of foreign workers. Specifically, it targets non-EU (extra-community) subcontracted workers.

From the law’s entry into force on April 18, 2025, the following measures apply:

• First-time work permit applications for this category of workers will begin to be refused.
• Non-EU subcontracted workers already present in Andorra with a current permit will have to leave the territory upon expiration of their current work contract, as renewal will likely not be granted under these new provisions.

Although the analyzed documents do not explicitly detail the specific activity sectors targeted by this measure within the framework of the Omnibus Law, it is likely to primarily impact sectors that traditionally use this type of labor for occasional or seasonal needs, such as construction or certain tourism-related services.

The underlying logic of this measure appears to be a desire to more tightly regulate the labor market, potentially to favor employment of residents or European Union citizens, or to better control migration flows and pressure on infrastructure. This restriction on foreign labor represents another facet of the general trend of the Omnibus Law toward increased control of foreign influences and presences in Andorra, whether capital or workers. The direct impact could be a labor shortage in the affected sectors, potentially causing project delays or an increase in labor costs to attract authorized workers.

V. The Vacant Housing Regime (Applicable from October 2025)

One of the major pillars of the Omnibus Law is the establishment of a specific regime aimed at combating residential vacancy, which will come into application in October 2025. This regime is planned for a duration of five years.

A. Obligations of Property Owners

The law defines a vacant housing unit, particularly based on the absence of an electricity supply contract or a zero or very low energy consumption over a reference period (for example, the two years preceding January 1, 2024). Owners of properties identified as vacant according to the criteria defined by the law and its implementing regulations will have strict obligations:

• They will need to put their property on the rental market or sell it.
• An alternative provided is the mandatory transfer of the property’s use to the administration for a maximum duration of five years. The administration will then allocate the property to the residential rental market, in exchange for financial compensation paid to the owner, based on an affordable rental price. If the administration fails to rent the property within a period of six months, it will be returned to its owner.

B. Penalties for Non-Compliance

To ensure the effectiveness of these obligations, the law establishes or reinforces dissuasive financial sanctions:

• A specific and progressive tax is applied to housing units kept vacant, the amount of which increases with the duration of vacancy.
• The rate of this tax on vacant housing is significantly increased, potentially rising from 50 euros per square meter to 100 euros per square meter. The objective is to make keeping a housing unit vacant economically penalizing for the owner.

C. Objective

The stated objective of this regime is clear: to reduce the number of unoccupied housing units and, consequently, increase the supply of housing available on the market, especially for rental, in order to contribute to resolving the housing shortage in Andorra.

This system represents a particularly interventionist measure, directly affecting the right to private property with the aim of achieving a public policy objective considered priority. The State is equipped with strong regulatory and fiscal tools to compel owners to mobilize their vacant properties. Its success will depend on the administration’s ability to effectively identify the affected housing units, enforce the obligations, and manage the properties that may be transferred. This measure could exert downward pressure on prices if a large number of owners decide to sell simultaneously, and it will inevitably generate administrative burdens for both property owners and the government.

VI. Mandatory Conversion of Tourist Accommodations

The Omnibus Law also addresses the use of the existing housing stock by imposing a transition for tourist accommodation units (HUT – Habitatges d’Ús Turístic in Catalan). This measure adds to the restrictions already put in place regarding the granting of new licenses for this type of accommodation.

A. Conversion Obligation

The law requires that existing HUTs be progressively converted into housing intended for long-term residential rental.

B. Timeline by Category

This transition is organized according to a precise timeline, depending on the category of the tourist establishment:

• 2028 Deadline: Affects tourist accommodations classified as less than 4 stars.
• 2030 Deadline: Affects tourist accommodations classified as 5 stars or considered “luxury”.

C. Transition Period

A grace period of three to five years is granted to owners before these deadlines. This period aims to allow them to amortize their investments made in the framework of tourist activity before the mandatory conversion.

D. Context and Objective

This measure is part of the global logic of the law aiming to increase the supply of housing available for residents by reallocating a significant part of the housing stock (estimated at nearly 2,800 units in August 2024) currently dedicated to short-term rental.

This is a major structural transformation that will impact both the housing market and the tourism sector. By potentially reducing the supply of tourist accommodations of the apartment or chalet type, it could modify the structure of the Andorran tourist offer, possibly in favor of hotels. If it achieves its objective of increasing the long-term rental housing stock, it could contribute to easing the residential market. However, this measure risks encountering resistance from HUT owners and could affect the flexibility of the tourist accommodation offer and the revenues of certain actors.

VII. Analysis of Anticipated Impacts

The 2025 Omnibus Law, due to its scope and the diversity of its measures, is likely to generate significant impacts on several aspects of the Andorran economy and society.

A. On the Andorran Real Estate Market

Supply and Accessibility: The main objective of the law is to increase the housing supply, especially affordable housing, for residents. The mechanisms put in place (vacant housing regime, conversion of HUTs, tax incentives, and obligations for foreign developers) are designed for this purpose. Their real effectiveness will depend on the vigor of their application and the market response. Challenges remain to ensure that the increase in supply effectively translates into better accessibility for all residents.

Market Activity: A modification in the nature of transactions is likely: fewer speculative purchases by foreigners, more investments oriented toward rental (especially affordable). The overall volume of transactions could experience an initial slowdown, as market players adapt to the new regulatory framework. The marked interest of foreign buyers before the law suggests that the restriction will have a notable impact.

B. On Foreign Investment Flows and Andorra’s Attractiveness

• The law is likely to cool the interest of foreign investors specifically interested in real estate speculation or the acquisition of multiple second homes, due to quantitative limitations and the progressive taxation of the IEI.
• Nevertheless, Andorra could remain attractive for other forms of investment: direct investments in local businesses (except pure real estate), portfolio investments. In addition, substantial tax incentives (90% reduction of the IEI) could attract foreign investors specifically interested in the development or acquisition of long-term affordable rental housing.
• Andorra’s overall attractiveness is also based on other factors that remain: a stable economic environment, a still very competitive general taxation (low personal income tax, corporate tax at 10%, IGI at 4.5%, absence of wealth tax and direct inheritance rights), a high quality of life (security, health, environment), and improving infrastructure. The simplification of business creation procedures can partially counterbalance the increased complexity of real estate regulation.

C. On the Tourism Sector and the Accommodation Landscape

• The mandatory conversion of tourist accommodations (HUT) into residential housing will lead to a reduction in accommodation capacity in this specific segment (apartments, chalets in short-term rental).
• This could lead to a shift in demand toward hotels or other forms of accommodation, or potentially limit tourist volume if the overall supply does not adjust.
• This measure could be part of a broader strategy aimed at reorienting Andorran tourism toward different segments or those with higher added value (experiential tourism, luxury, wellness), rather than volume based on apartment rental.
• Companies specialized in the management of tourist apartments will be directly affected and will have to adapt their business model.

D. On the Housing Crisis and the Andorran Social Fabric

• The law has the potential to alleviate the housing crisis for residents by increasing the rental supply and curbing price increases.
• Socially, this could reduce pressure on tenants. However, frictions could appear with property owners (regarding vacant housing or the conversion of HUTs).
• The modifications of work permits for non-EU subcontractors could alter the composition of the workforce in certain sectors and have indirect social repercussions.

E. General Economic Considerations and Expert Perspectives

• The overall economic forecasts for Andorra remained moderately positive before the full measure of the effects of the Omnibus Law (GDP growth forecast around 1.5-2.1%, controlled inflation according to the IMF). The net impact of the law on these indicators remains to be evaluated.
• The law represents a complex attempt to find a balance between the need to regulate to protect residents and the desire to maintain a dynamic economy attractive for targeted investments. The success of this balance is not guaranteed and will depend on market reaction and implementation effectiveness.
• Although expert analyses specific to this law are limited in the provided documents, the general sentiment that emerges is that of a paradigm shift. The possibility of unforeseen effects or the need for future adjustments is recognized.

A powerful common thread through the various measures is the objective of promoting affordable housing. Whether through the tax incentives of the IEI, the mandates for foreign developers, or indirectly via the vacant housing regime and the conversion of HUTs, the priority given to increasing the stock of accessible housing for residents appears to be the main driver of this major reform of real estate regulation and foreign investment.

VIII. Potential Legal Challenges and Future Perspectives

Although the Omnibus Law is now in force, its journey may not be completely finished, and its future application could be influenced by various factors.

A. Legal Appeals

• The possibility of an appeal before the Constitutional Court has been mentioned, especially by the political group Andorra Endavant. However, the absence of necessary support from other political forces (such as the PS or Concòrdia) makes this eventuality unlikely in the short term.
• Potential grounds for such an appeal could concern infringements on property rights, issues of non-discrimination between national and foreign investors (although the structuring of the IEI in Law 3/2024 attempted to address this point), or other constitutional aspects. Nevertheless, given the current political context, a major legal reversal of the law seems unlikely.

B. Modification Factors and Future Evolution

• The law itself or its application methods could be subject to future legislative adjustments. The Andorran government could be led to modify certain provisions depending on the observed impacts on the market, implementation difficulties, or the evolution of political priorities. The complexity of the law and the interaction of its different measures make possible unforeseen consequences that might require corrections.
• The transitional regime provided by the law for transactions already engaged or previously authorized investments will modulate the immediate impact of the law for certain specific actors.
• Regular monitoring of authorized investments is planned by the authorities, indicating an intention to actively monitor compliance and potentially adapt the regulation based on the data collected.
• In the longer term, ongoing negotiations toward an association agreement between Andorra and the European Union could influence the national legislative framework, potentially including areas related to free movement, competition, or regulatory standards, although a direct and immediate impact on the specific provisions of the Omnibus Law seems less likely.

In sum, although a complete legal reversal seems unlikely, the 2025 Omnibus Law should not be considered as fixed legislation. Its complexity and interventionist character suggest that it inaugurates a new phase of regulation that will likely be subject to continuous monitoring, potential jurisprudential interpretations, and possible legislative adjustments as its concrete effects manifest. Investors and other stakeholders will therefore need to show vigilance regarding its practical application and possible future developments.

IX. Conclusion

The 2025 Omnibus Law constitutes a significant legislative response to the tensions observed in the Andorran housing market and the consequences of foreign real estate investment. It articulates several key measures: strict limitations on the number of real estate properties that can be acquired by foreign natural persons, a progressive taxation (IEI) strongly incentivizing investment in affordable rental housing, an obligation for foreign developers to dedicate their projects to this segment, a coercive regime to mobilize vacant housing, the mandatory conversion of tourist accommodations into residential housing, and restrictions on work permits for non-EU subcontractors.

The stated objective of the government is clear: to improve housing access for residents, curb real estate speculation, and ensure more sustainable and balanced growth. However, the real impacts of this complex law are still uncertain and could include a slowdown in the real estate market, a reorientation of foreign investment flows, adjustments in the tourism sector, and tensions in the labor market in certain sectors. The success of this law will depend on its effective implementation and the reaction of the various economic actors.

From the legal analysis perspective, the Omnibus Law marks a turn toward a significantly more interventionist regulatory environment in Andorra, especially in the real estate sector. Foreign investors, developers, property owners, and concerned businesses must imperatively analyze in detail the provisions that specifically affect them. It is essential to understand the interaction between the Omnibus Law and Law 3/2024 (IEI) as amended, as well as the implications of the different timelines and exemptions. Recourse to legal and tax advice specialized in Andorran law is more than ever recommended to navigate this new regulatory landscape and ensure compliance of operations. Diligence and anticipation will be crucial in this evolving context.

Ultimately, the 2025 Omnibus Law raises the question of whether it represents a cyclical adjustment or a structural and lasting change in Andorra’s approach to foreign investment and the management of its real estate market. The coming years will allow for an evaluation of the effectiveness of these measures and a determination of whether new adaptations will be necessary to achieve the objectives of sustainable development and well-being for the Principality.

The recent decisions by the United States to impose new tariffs on European products have created a complex economic situation for Europe. In this context, Andorra, with its special status and advantageous tax regime, offers an attractive alternative for entrepreneurs and investors looking to optimize their international strategy. This article analyzes the impact of these tariff measures on the Andorran economy and the new opportunities that arise from them.

The Context of the New U.S. Tariff Measures

The United States has recently intensified its protectionist policy by imposing a series of significant tariffs on European products. These measures, which came into effect in 2025, mark a turning point in transatlantic trade relations.

Overview of the New Tariffs

Since February 2025, the United States has implemented several waves of additional tariffs targeting the European Union. Among the main measures are 25% tariffs on steel, an increase from 10% to 25% on aluminum, as well as taxes on various derivative products containing these materials. On March 26, 2025, a new series of 25% tariffs was imposed on vehicles and automotive parts, followed in early April by the establishment of a minimum rate of 10% on all products imported into the United States, raised to 20% for European Union products.

European Response to U.S. Measures

In response to these measures, the European Commission has adopted a counter-measure strategy. It first allowed the suspension of existing counter-measures against the United States dating from 2018 and 2020 to expire on April 1, 2025. In addition, new counter-measures on U.S. exports are being prepared to respond to tariffs affecting more than €18 billion in EU exports.

Andorra’s Unique Position in this Trade Conflict

Andorra, as a non-member of the European Union, finds itself in a particular position regarding this trade conflict. This situation creates a favorable context for the Principality.

Andorra’s Specific Customs Status

Although Andorra maintains close relations with the European Union, particularly through the customs union for industrial products, it retains significant independence and flexibility in terms of trade policy. Not being directly targeted by U.S. measures aimed at the EU, the Principality benefits from a more favorable framework for its exports to the United States.

Comparative Advantages in International Trade

This unique position allows Andorra to position itself as an attractive platform for companies wishing to maintain fluid trade exchanges with the United States while retaining privileged access to the European market. Companies based in Andorra can thus potentially circumvent certain tariff barriers while benefiting from the advantageous trade agreements that the Principality maintains with its partners.

Economic Opportunities for Andorra

The trade tensions between the United States and the European Union open new perspectives for the Andorran economy, particularly in certain strategic sectors.

Potentially Favored Sectors

Andorran industries less impacted by U.S. tariff measures may experience increased attractiveness. Among these sectors are:

• International e-commerce, which can take advantage of Andorra’s specific tax and customs arrangements
• Financial and consulting services, which can support companies in their restructuring in the face of new trade conditions
• The luxury sector and high value-added products, for which the impact of tariffs represents a smaller proportion of the final price

Investments and Business Relocations

Faced with commercial uncertainties, Andorra can attract European companies seeking to diversify their geographical presence. The Principality offers:

• A stable and advantageous tax environment
• Qualified multilingual workforce
• A strategic geographical location between France and Spain
• Modern infrastructure and exceptional quality of life

The Andorran Tax Regime as a Major Asset

In a context of increased trade tensions, the Andorran tax system represents a decisive competitive advantage for companies and individuals.

Comparison with European Tax Regimes

With a corporate tax capped at 10% (compared to a European average exceeding 20%), Andorra offers one of the most competitive tax environments in Europe. This difference becomes particularly significant in a context where European companies see their margins reduced by U.S. tariffs. For individuals, the absence of inheritance and gift taxes, as well as an income tax capped at 10%, also constitute major advantages.

Tax Conventions and Prevention of Double Taxation

Andorra has considerably developed its network of tax conventions in recent years, particularly with France, Spain, and Portugal. These agreements guarantee legal security for international investors and effectively prevent the risks of double taxation, a crucial element in a tense international trade environment.

Practical Consequences for Companies Established in Andorra

Companies operating from Andorra can benefit from several concrete advantages in the current context of tense trade relations between the United States and Europe.

Optimization Strategies for Export

Companies based in Andorra can develop optimized commercial strategies by taking advantage of the Principality’s particular status. This may include:

• Establishing international distribution structures adapted to the new tariff context
• Valorizing the Andorran origin of products to avoid certain U.S. surcharges
• Exploring new markets by relying on Andorra’s political neutrality

Testimonials and Success Stories

Several international companies have already chosen Andorra as their operational base and have been able to observe the concrete benefits of this decision. Companies in the e-commerce, information technology, and business services sectors report in particular a significant improvement in their international competitiveness.

Expatriation and Establishment Process in Andorra

For entrepreneurs and investors considering relocation to Andorra, several procedures must be anticipated.

Conditions and Procedures for Individuals

Obtaining Andorran residence requires:

• A real estate or financial investment in the country
• Proof of sufficient resources to meet the applicant’s needs
• Valid health insurance in Andorra
• A clean criminal record

The process is generally smooth and quick compared to other European jurisdictions, with an average processing time of 2 to 3 months.

Creating and Managing a Business in Andorra

Creating a company in Andorra involves:

• Choosing an appropriate legal form (SA, SL, etc.)
• Drafting statutes in accordance with Andorran legislation
• Opening a local bank account
• Obtaining the necessary administrative authorizations according to the sector of activity

Administrative procedures have been considerably simplified in recent years, facilitating the establishment of foreign companies.

Perspectives on the Evolution of the International Context

The current trade tensions are part of a broader trend of reconfiguration of international exchanges, offering Andorra long-term opportunities.

Probable Evolution of U.S.-EU Trade Relations

While analysts agree that current trade tensions could be prolonged, negotiations are nevertheless underway to find compromises. In this fluctuating context, Andorra can play a role as a commercial bridge between the two blocs, offering stability and predictability to international investors.

Andorra’s Strategic Positioning in the Medium Term

The Principality of Andorra continues its strategy of economic openness while preserving its fiscal and regulatory specificities. This balanced position, associated with the continuous modernization of its economy, places the country on a favorable trajectory for the years to come, regardless of the evolution of international trade tensions.

Conclusion: Andorra, a Solution in the Face of Commercial Uncertainty

In a context of growing trade tensions between the United States and the European Union, Andorra appears as a particularly attractive jurisdiction for entrepreneurs and investors seeking stability and tax optimization. Its unique status, advantageous tax regime, and strategic geographical position make it a choice alternative for those who wish to develop their international activity while limiting the impact of U.S. tariff measures.

To explore the concrete opportunities that Andorra offers for your personal or professional situation, do not hesitate to make an appointment with our specialized advisors. They can accompany you in analyzing the specific advantages that expatriation to Andorra represents in the current context and guide you through all the necessary procedures.

Andorra, this small country nestled between France and Spain, has long been known for its advantageous taxation. This reputation attracts many investors, especially those interested in the rapidly expanding world of bitcoin and cryptocurrencies. With the constant evolution of the news, notably the fluctuations in Bitcoin and the cryptocurrency market and international political decisions, it is essential to understand how Andorra positions itself in this context.

Attractive taxation in a changing global context

In recent years, cryptocurrencies have experienced exponential growth. Digital currencies like Bitcoin, Ethereum, and Ripple have become major financial assets, attracting the attention not only of individual investors but also of financial institutions and governments. In this context, Andorra has positioned itself as a tax haven for cryptocurrency investors.

How are cryptocurrencies taxed in Andorra?

In Andorra, capital gains realized on the sale of cryptocurrencies are subject to income tax. The tax rate is set at 10%, after an allowance of 3,000 euros. This means that the first 3,000 euros of capital gains are not taxed, which is particularly attractive for small investors.

For example, if you buy a Bitcoin for 10,000 euros and sell it for 20,000 euros, you realize a capital gain of 10,000 euros. After the 3,000 euro allowance, taxation will apply to 7,000 euros, which represents a tax of 700 euros (10% of 7,000 euros). This makes the Andorran tax system particularly competitive compared to other countries where rates can be significantly higher.

It is important to note that exchanges of cryptocurrencies between themselves are not taxable. Thus, if you exchange Bitcoin for Ethereum, no tax is applied at that time. However, the acquisition of goods or services in cryptocurrencies is subject to income tax if it results in a capital gain. This means that if you use your cryptocurrencies to buy a car or real estate, you will have to declare the capital gain realized at the time of the transaction.

Why is Andorra attractive for cryptocurrency investors?

Several reasons explain the attractiveness of Andorra for cryptocurrency investors:

• Low tax rate: With a maximum rate of 10%, Andorra offers one of the lowest tax rates in Europe. This allows investors to maximize their gains.
• Transparent taxation: Andorran legislation on cryptocurrencies is clear and precise. Tax rules are established, which reduces uncertainty for investors.
• Stable legal framework: In 2022, Andorra adopted specific regulations for cryptocurrencies, thus providing a secure legal environment for transactions and investments.
• Developing technological infrastructure: Andorra is investing in information and communication technologies, thus promoting the emergence of ecosystems conducive to blockchain and fintech companies.

Impact of international political decisions on Andorran taxation

Political decisions taken at the international level can have an impact on the taxation of cryptocurrencies in Andorra. For example, American and European regulations on cryptocurrencies influence investment flows and local legislation. Although Andorra is not a member of the European Union, it maintains close relations with its neighbors and adapts to international standards to maintain its attractiveness and reputation.

How to declare your cryptocurrencies in Andorra?

Investors must be diligent in reporting their digital assets. The declaration of capital gains must be made as part of the annual income tax return, before December 31 of the calendar year.

To declare your cryptocurrencies, you must provide the following information:

• The date of acquisition and the purchase price of the cryptocurrency.
• The date of sale and the sale price of the cryptocurrency.
• The amount of the realized capital gain.

It is recommended to keep all proofs of purchase and sale, such as transaction statements and exchange confirmations, to facilitate the reporting process and in case of tax audit.

Examples of tax situations

• Acquisition and sale with capital gain:
  • You buy Litecoin for 5,000 euros and sell it for 15,000 euros.
  • Realized capital gain: 10,000 euros.
  • After the 3,000 euro allowance, the taxable amount is 7,000 euros.
  • Tax to be paid: 700 euros (10% of 7,000 euros).
• Cryptocurrency exchange:
  • You exchange 0.5 Bitcoin for 10 Ethereum.
  • This operation is not taxable as it is an exchange between cryptocurrencies.
• Purchase of goods with cryptocurrencies:
  • You buy a car worth 30,000 euros using cryptocurrencies that you had bought for 20,000 euros.
  • Realized capital gain: 10,000 euros.
  • After allowance, taxable amount: 7,000 euros.
  • Tax to be paid: 700 euros.

Current trends in the cryptocurrency market in Andorra

With the rise of cryptocurrencies, Andorra is seeing a significant increase in the number of interested investors. Recent market fluctuations, such as the increase in Bitcoin beyond 60,000 euros in 2023, have sparked increased interest in digital assets. Moreover, the adoption of cryptocurrency-friendly legislation in other countries encourages Andorra to maintain a competitive environment.

The influence of the United States on the cryptocurrency market

Although Andorra is a small European country, decisions made in the United States can have a significant impact on Andorran cryptocurrency investors. For example, US regulations on exchange platforms or tax decisions can influence global market trends.

In 2023, discussions in the United States about increased regulation of cryptocurrencies led to market fluctuations. Andorran investors must therefore stay informed of international developments to adapt their investment strategy.

Andorran government initiatives

Recognizing the potential of cryptocurrencies and blockchain technology, the Andorran government has launched several initiatives:

• Promotion of financial education: Educational programs are put in place to raise public awareness of the opportunities and risks associated with cryptocurrencies.
• Encouragement of startups: Andorra offers incentives for startups specializing in blockchain and fintech, thus strengthening its technological ecosystem.
• International partnerships: The country seeks to establish partnerships with other nations to promote the exchange of information and best practices in cryptocurrency regulation.

Conclusion

Andorra is positioning itself as a major player for cryptocurrency investors thanks to its advantageous taxation, clear legislation, and stable environment. In a world where cryptocurrencies are becoming increasingly important, it is crucial for investors to understand the tax implications of their operations.

By staying informed about market developments and international regulations, and by respecting local tax obligations, investors can make the most of the opportunities offered by Andorra. Whether you are an experienced investor or just starting out in the world of cryptocurrencies, Andorra offers a conducive framework for developing your investments with peace of mind.

The Principality of Andorra is renowned for its advantageous tax system and exceptional quality of life. Located between France and Spain, this small Pyrenean country attracts more and more entrepreneurs, investors, and individuals seeking legal and effective tax optimization. In this article, we provide you with a comprehensive overview of Andorran taxation, detailing the main taxes and fees for residents and businesses.

The Advantages of the Andorran Tax System

The Andorran tax system is characterized by its simplicity, transparency, and some of the lowest tax rates in Europe. Here are the main tax advantages enjoyed by residents and companies in Andorra:

• Personal Income Tax (IRPF) capped at 10%
• Corporate Tax (IS) limited to 10% of profits
• VAT (IGI) of only 4.5%, the lowest rate in Europe
• No wealth tax or inheritance tax
• Reduced social contributions for excellent social protection

Personal Income Tax in Andorra (IRPF)

The IRPF is the main tax for Andorran residents. It is applied according to a progressive scale based on annual income:

• 0% up to €24,000 of income
• 5% from €24,000 to €40,000
• 10% above €40,000

Note that income from economic activities (entrepreneurs, self-employed professionals) has been included in the IRPF for a few years now.

Corporate Tax in Andorra (IS)

The IS applies to the profits of Andorran companies as follows:

• 5% up to €50,000 of profits (under conditions)
• 10% above €50,000 of profits

Tax credits and deductions are possible for investments, R&D, job creation, etc.

Andorran VAT (IGI)

The standard VAT rate (Impost General Indirecte) is 4.5% in Andorra. Some products and services benefit from reduced rates or VAT exemption.

Other Taxes in Andorra

Residents and Andorran companies are also subject to other taxes:

• Capital gains tax on real estate (from 0% to 15% depending on the holding period)
• Registration fees (from 1% to 4.5%)
• Municipal taxes on professional and commercial premises

International Taxation and Agreements

Andorra has signed more than 40 bilateral tax agreements with other countries to avoid double taxation. The non-domiciled tax resident status also allows for optimizing taxation for high foreign wealth.

A Concrete Example of Tax Optimization in Andorra

For a company with a turnover of 10 million euros and profits of 2 million euros, setting up in Andorra allows savings of up to 300,000€ in taxes per year compared to an establishment in France. Other optimization levers can further increase savings: holding companies, dividend distribution, etc.

Conclusion

The Andorran tax system offers many advantages for both individuals and businesses. With some of the lowest tax rates in Europe, tax deductions and credits, international tax agreements, and personalized support, tax optimization in Andorra is an opportunity to seize. Do not hesitate to seek advice from experts to take full advantage of all the benefits of Andorran taxation.

If you have a business creation project, have you considered Andorra? Located between France and Spain, the Principality attracts many entrepreneurs every year. This complete guide explains why and how to successfully launch your Andorran company.

5 good reasons to set up your business in Andorra

Andorra combines many advantages for business creators. Here are 5 of the most attractive:

1. An advantageous tax system

With a corporate tax rate capped at 10%, and even 2% in some cases, as well as one of the lowest VAT rates in Europe (IGI at 4.5%), the Principality allows you to optimize your profits.

Understanding Andorran VAT

2. Reduced charges

With employer contributions lower than many neighboring countries, hiring costs less in Andorra. Ideal for controlling your payroll.

Overview of taxation in Andorra

3. An exceptional quality of life

Between preserved mountains, clean air, an efficient healthcare system and optimal security, Andorra offers a privileged living environment to its residents. Life expectancy is one of the highest in the world!

The advantages of the Andorran healthcare system

4. A strategic geographical location

Only 2.5 hours drive from Toulouse and Barcelona, Andorra is ideally located for quick access to the French and Spanish markets.

5. Simplified procedures

Setting up a company is often simpler and faster in Andorra than elsewhere. With good support, you can be operational in about 3 months.

All about Andorran legal forms

Between SL, SA or Collective Company, the choice of status depends on the size of your project and your situation.

For small structures: the SL

Equivalent to the French SARL, the Limited Company (SL) requires a starting capital of €3,000. Ideal solo (SLU) or with several partners.

For larger projects: the SA

The Public Limited Company (SA) requires more capital (min. €60,000) and formalities, but offers better credibility. It can also be sole shareholder (SAU).

The Collective Company: capital shared between partners

Here, the capital is shared between the different partners, as for the SL or SA.

Choosing the right legal status in Andorra

5 steps to start your business in Andorra

Here is the path to follow to launch your Andorran company:

1. Choose the company name: propose 3 names to the government, which will validate one within 10 days.
2. Obtain investment authorization: each foreign partner must make a prior request (10-15 days).
3. Deposit the share capital: open a provisional bank account in Andorra (1 to 4 weeks).
4. Go to the notary and register the company: sign the articles of association, then head to the commercial register.
5. Declare the opening of the business: final administrative step (except for holdings). You need to provide a registered office address and an electrical certificate.

Rules to follow as a manager

Once your company is launched, you will have to keep proper accounts, pay social contributions for your employees (max. 22%)…

Become an Andorran resident thanks to your company

Creating your company in Andorra or domiciling your company there can make it easier for managers owning at least 21% of the shares to obtain residency. But it is also possible to manage remotely.

The chartered accountants at Clickand support you at every stage of your establishment. Benefit from tailor-made advice from specialists in entrepreneurial expatriation to serenely realize your project.

Talk to a Clickand consultant

Andorra, a Tax Haven for Individuals and Businesses

Andorra has emerged as a top destination for tax optimization, attracting individuals and businesses seeking legitimate and transparent tax solutions. Thanks to its advantageous taxation and numerous benefits, the principality offers an environment conducive to tax optimization.

What is Tax Optimization in Andorra?

Definition and Application of Tax Optimization

Tax optimization aims to legally reduce the tax burden. In Andorra, it translates into strategies developed by experienced tax lawyers, in accordance with national and international legislation. Various elements such as types of income, investments, and asset structure are taken into account to maximize tax efficiency.

The Pillars of Tax Optimization in Andorra

Tax optimization in Andorra is based on four key pillars: tax residency, business creation, international investments, and tax structuring. Establishing tax residency allows one to benefit from advantageous tax rates, while creating a business offers a favorable tax environment. Diversifying investments internationally and intelligent tax planning contribute to reducing the overall tax burden.

Tax Optimization for Businesses

Tax Optimization Strategies for Businesses in Andorra

Businesses can optimize their taxation in Andorra by choosing the appropriate legal form, structuring their profits wisely, and leveraging tax incentives offered by the Andorran government. The choice of legal form, such as LLC, PLC, or SC, influences the company’s taxation. Distributing profits among different entities helps minimize the overall tax burden.

Taking Advantage of Andorran Tax Incentives

Andorra offers numerous tax incentive programs for businesses, particularly for special economic zones, research and development, and innovation. Using a holding company can also be beneficial for holding shares in other companies and optimizing dividend taxation.

Tax Optimization for Individuals

Tax Optimization Strategies for Individuals in Andorra

Individuals can optimize their taxation in Andorra by wisely planning their investments and taking advantage of specific tax regimes. Diversifying financial investments, taking into account the tax implications of each type of investment, helps minimize the tax impact. Timing management and income distribution are also key factors.

Advantageous Tax Regimes for Individuals

Andorra offers favorable tax regimes for retirees and non-residents. Taking advantage of these specific regimes can significantly reduce individuals’ tax burden. It is important to learn about the eligibility conditions and benefits offered by each regime.

Tax Benefits in Andorra

A Competitive Tax Environment

Andorra stands out for its numerous tax advantages. The corporate tax rate is low, with a general rate of 10% and reduced rates for certain business sectors. The absence of inheritance and gift taxes ensures the protection of family assets and facilitates intergenerational transfer without taxation.

Low VAT and Double Taxation Agreements

The standard VAT rate in Andorra is 4.5%, which is significantly lower than many other European countries. Moreover, Andorra has signed double taxation agreements with several countries, thus avoiding double taxation of income.

Compliance with International Standards

Andorra, a Responsible Player on the International Scene

As a signatory to the OECD Declaration, Andorra is committed to complying with international standards on transparency and the fight against tax evasion. This guarantees investors the legitimacy and legal security of their tax optimization efforts.

A Business-Friendly Environment

Andorra offers a stable and business-friendly regulatory framework. The principality has implemented measures to attract foreign investors and facilitate business creation. Administrative procedures are streamlined, and authorities are attentive to entrepreneurs’ needs.

Clickand’s Expertise in Tax Optimization

Personalized Support for Your Tax Optimization

At Clickand, an accounting and tax advisory firm specializing in tax optimization in Andorra, we put our expertise at the service of our clients. Our team of qualified professionals guides you through your tax optimization process, offering tailor-made solutions adapted to your situation.

Benefit from Best Tax Practices

Thanks to our constant monitoring of regulatory changes and our in-depth expertise, we ensure tax optimization in full compliance with the legislation in force. We help you make the most of the tax benefits offered by Andorra while respecting legal obligations.

Conclusion

Tax optimization in Andorra offers an attractive tax environment for individuals and businesses looking to optimize their taxation. With its numerous tax advantages, compliance with international standards, and a business-friendly framework, the principality is a top choice for legal and transparent tax optimization.

To fully benefit from tax optimization opportunities in Andorra, it is essential to surround yourself with competent professionals. At Clickand, we put our expertise at your service to guide you through your efforts and help you achieve your tax objectives. Contact us now for personalized support.

Andorra, a small country nestled between France and Spain, is known for its tax advantages and investment opportunities. Opening a duty-free shop in this principality can be a lucrative venture, but requires a thorough understanding of local laws and procedures. In this article, we’ll guide you through all the necessary steps to bring your business project to life in Andorra, from finding a location to obtaining required authorizations.

Understanding the Andorran Economic Context

Before launching into opening a duty-free shop in Andorra, it’s essential to understand the country’s economic context. Andorra is known for its advantageous tax system and its status as a popular tourist destination, making it an ideal location for this type of business. The country welcomes millions of visitors each year, attracted by its ski resorts, mountain landscapes, and tax-free shopping opportunities.

Active Residency: A Crucial Step

To open a business in Andorra, obtaining active resident status is necessary. This status allows you to legally live and work in the country. Here are the main steps to obtain active residency:

• Create an Andorran company or purchase shares in an existing business
• Invest a minimum of €15,000 in the Andorran economy
• Subscribe to Andorran social security
• Live in Andorra for at least 183 days per year
• Obtain a work and residence permit

The process can take several months, so it’s recommended to start the procedures well in advance.

Finding the Ideal Location for Your Duty-Free Shop

Location is a key factor for the success of your duty-free shop. You have two main options: renting or buying a commercial property.

Renting a Commercial Property

Advantages:

• Lower initial investment, more flexibility
• Disadvantages: potentially high rent, less long-term control

To rent a commercial property in Andorra, you’ll need to:

• Search for locations in areas with high tourist traffic
• Negotiate lease terms with the property owner
• Verify that the property meets duty-free shop standards

Buying a Commercial Property

Advantages:

• Long-term investment, more control over the property
• Disadvantages: higher initial investment, less flexibility

To buy a commercial property in Andorra, you’ll need to:

• Find a property suitable for your business
• Engage an Andorran notary for the transaction
• Obtain a purchase permit from the Andorran government

Understanding Laws and Regulations

Opening a duty-free shop in Andorra is subject to various laws and regulations. Here are the main ones to know:

• Foreign Investment Law: regulates the conditions under which foreigners can invest in Andorra
• Company Law: defines the different types of legal structures available in Andorra
• Duty-Free Shop Regulations: specific rules apply to tax-free shops, particularly regarding authorized products for sale and quantities
• Tax Laws: although Andorra is known for its advantageous taxation, there are taxes to consider, such as corporate tax (10%) and VAT (4.5%)
• Labor Regulations: defines the rights and obligations of employers and employees in Andorra

It’s highly recommended to work with a specialized local lawyer to guide you through these various regulations.

Administrative Procedures to Open Your Duty-Free Shop

Once you’ve obtained your active residency and found a location, here are the main administrative steps to follow:

• Create your company: choose the appropriate legal structure (typically an SL – Limited Company) and register it with the Company Registry
• Obtain a commercial license: request a business operating permit from the Comú (town hall) of the parish where your property is located
• Register with the trade registry: a mandatory step for all businesses in Andorra
• Obtain specific duty-free shop authorizations: particularly from Andorran customs
• Register with tax authorities: for VAT and corporate tax
• Subscribe to mandatory insurance: civil liability, property insurance, etc.

Financing and Investment

Opening a duty-free shop in Andorra requires substantial investment. Here are some financing options to consider:

• Personal funds: use your personal savings or investor funds
• Bank loans: Andorran banks offer business loans
• Government aid: inquire about possible grants or investment aid

Prepare a detailed business plan to estimate your financing needs and convince potential lenders or investors.

Operational Management of Your Duty-Free Shop

Once all authorizations are obtained, focus on the operational management of your duty-free shop:

• Supply chain: establish relationships with reliable suppliers for your duty-free products
• Staff: recruit and train your team while respecting Andorran labor law
• Marketing: develop a strategy to attract tourists and local customers
• Accounting and taxation: comply with Andorran accounting and tax obligations

Conclusion

Opening a duty-free shop in Andorra can be a complex but potentially very profitable venture. By following the steps described in this article, from obtaining active residency to operational management, you’ll put all the odds in your favor to succeed in your project. Don’t forget to surround yourself with local professionals (lawyers, accountants, real estate agents) to guide you through this process. With perseverance and good planning, your Andorran duty-free shop will soon be ready to welcome its first customers!

Andorra, a small state located between Spain and France, represents today a strategic and attractive investment destination. Its political and economic stability, combined with advantageous taxation, makes it a privileged choice for wealth management in 2025.

Overview of the Andorran Financial System

The Andorran Banking Sector

The Andorran banking system stands out for its solidity and modernity. The country’s main banks – Andbank, MoraBanc, and Crèdit Andorrà – offer sophisticated services comparable to international standards, particularly:

• Multi-currency current accounts adapted to international needs
• Savings accounts with attractive yields
• Professional banking solutions for entrepreneurs

These institutions have recognized expertise in wealth management and offer personalized support to foreign investors.

Economic and Fiscal Stability

Andorra maintains a stable and diversified economy with no significant public debt. The country maintains a positive financial rating with international agencies while ensuring financial transparency in accordance with international standards.

Andorran residents benefit from considerable tax advantages:

• Income tax capped at 10%
• No wealth tax
• Double taxation agreements with several countries
• IGI (VAT) limited to 4.5%

Different Investment Options

Real Estate: A Safe Haven

The Andorran real estate market offers solid prospects:

• Average rental yield of 4 to 6%
• Stable capital appreciation
• Luxury real estate opportunities
• A dynamic market driven by tourism
• Transparent acquisition procedures

Investors can opt for different strategies: direct acquisition, creation of real estate investment companies, or rental investment.

Banking and Financial Products

Andorran financial institutions offer a complete range of investment solutions:

• Diversified investment funds
• Tailored life insurance products
• International investment portfolios
• Regulated crypto-asset investment solutions
• Structured products adapted to different risk profiles

Emerging Trends

The Andorran financial sector adapts to new trends:

• Sustainable and responsible investment
• Innovative financial technologies
• Regulated cryptocurrencies
• Ethical and socially responsible investments

Practical and Regulatory Aspects

Legal Framework and Compliance

Andorran legislation offers a secure environment:

• Enhanced investor protection
• Compliance with European standards
• Guaranteed banking transparency
• Simplified investment procedures

Obligations and Procedures

To fully benefit from the Andorran system:

• Obtaining fiscal resident status (minimum 183 days per year)
• Annual income declaration
• Compliance with foreign asset declaration obligations
• Compliance with automatic information exchange agreements

Optimization Strategies

A strategic approach allows investment optimization:

• Adapted wealth structuring
• Diversification of investment vehicles
• Appropriate use of investment vehicles
• Personalized tax support

Recommendations and Precautions

Risk Management

Essential vigilance points:

• Rigorous investment risk assessment
• Appropriate portfolio diversification
• Regular monitoring of regulatory developments
• Consultation with qualified local experts

Practical Advice

To succeed in your Andorran investment:

• Work with locally recognized professionals
• Conduct thorough due diligence
• Maintain active monitoring of opportunities
• Adopt a flexible and informed approach

Investment in Andorra in 2025 represents a strategic opportunity for investors seeking a balance between performance and security. The combination of an attractive tax environment, sophisticated financial services, and proven political stability makes it a reference destination for international wealth management.

The Principality of Andorra has long been renowned for its attractive tax system. The Andorran tax framework offers numerous advantages for both individuals and businesses seeking to optimize their financial situation. This comprehensive guide explores all aspects of Andorran taxation to provide you with precise and complete information.

The Andorran Tax System: An Overview

The Andorran tax system ranks among Europe’s most competitive frameworks. It is characterized by low tax rates and investor-friendly legislation. Through its fiscal policy, Andorra continues to attract an increasing number of high-net-worth residents and international companies.

Furthermore, the Principality has implemented numerous reforms to comply with international standards. As a result, it now offers a transparent and stable tax environment, thereby strengthening its credibility among global economic actors.

Personal Income Tax (PIT)

Personal income tax in Andorra remains significantly lower than in neighboring countries. The tax rates are progressive, ranging from 0% to 10%, allowing residents to benefit from advantageous taxation.

Specifically, the structure is as follows:

The first €24,000 of income is tax-exempt From €24,001 to €40,000: 5% rate Above €40,000: 10% rate

This favorable tax structure encourages many individuals to consider establishing residence in Andorra.

Corporate Income Tax (CIT)

Companies established in Andorra benefit from a highly competitive corporate tax rate. The standard CIT rate is 10%, making it attractive for companies looking to optimize their tax burden.

Additionally, reduced rates are available for certain sectors or under specific conditions, particularly for new companies or those investing in research and development.

Value Added Tax in Andorra: General Indirect Tax (IGI)

In Andorra, VAT is known as the General Indirect Tax (IGI). The standard IGI rate is only 4.5%, one of the lowest in Europe. This makes goods and services more affordable for consumers and stimulates local commerce.

Reduced rates apply to certain essential products:

0% for educational and medical services 1% for basic food products 2.5% for cultural, sports, and tourism services

Tax Benefits for Residents

Becoming a tax resident in Andorra presents numerous advantages. Residents benefit from:

Low income taxation No wealth tax No inheritance tax between close relatives

Beyond tax advantages, residents enjoy an exceptional quality of life, with high security standards, preserved natural environment, and a stable economy.

How to Become a Tax Resident in Andorra

Non-Lucrative Residence (Passive Residence)

To be eligible, applicants must:

Invest a minimum of €600,000 in Andorra (real estate, financial assets, etc.) Demonstrate sufficient income to support themselves Subscribe to private health insurance

Active Residence (For Professional Activities)

This category applies to individuals wishing to work in Andorra. Requirements include:

Creating or acquiring a company in Andorra Active participation in its management Residing in the territory for at least 183 days per year

International Tax Treaties

Andorra has signed several tax treaties to prevent double taxation. These agreements allow residents and businesses to avoid paying taxes on the same income in two different countries.

Countries that have signed agreements with Andorra include:

France Spain Portugal Luxembourg United Arab Emirates

Investment Taxation in Andorra

Investments in Andorra enjoy a favorable tax regime. Capital gains are generally taxed at a reduced rate, or even exempt in certain cases.

Moreover, the Andorran real estate market offers attractive opportunities, with growing demand and regulations favorable to foreign investors.

Corporate Tax Obligations in Andorra

Companies are subject to certain tax obligations, including:

Maintaining accounting records compliant with international standards Filing tax returns and paying taxes within legal deadlines Compliance with specific sector regulations

However, the simplified administrative framework facilitates these procedures, allowing entrepreneurs to focus on developing their business.

Comparison with Neighboring Countries’ Tax Regimes

Compared to its neighbors, Andorra’s taxation is significantly more advantageous:

France: income tax rates up to 45%, wealth tax Spain: income tax rates up to 47%, wealth tax

This difference encourages many individuals and businesses to consider establishing themselves in Andorra to benefit from more favorable taxation.

Conclusion

In summary, Andorra’s tax system offers numerous advantages for those seeking to optimize their tax situation. With its low tax rates, benefits for residents, and stable economic environment, the Principality positions itself as a premier destination in Europe.

For any questions about Andorran taxation or to begin the necessary procedures, it is recommended to consult professionals specializing in Andorran tax law.

Andorra, nestled in the heart of the Pyrenees, continues to draw attention in 2024. This microstate, known for its enchanting surroundings and fiscal advantages, solidifies its status as a top destination for expatriates seeking quality of life and economic opportunities. Here’s a detailed review of key highlights, major developments, and future prospects for those looking to settle in the country.

1. Why Choose Andorra for Expatriation in 2024?

With its sunny climate, mountains ideal for outdoor activities, and advantageous tax system, Andorra stands out as a preferred destination for expatriates. In 2024, this trend has strengthened as professionals in the tech sector, entrepreneurs, and families seeking security and quality education continue to move in.

Key factors making Andorra attractive include:

• Competitive Tax Framework: With income tax capped at 10% and no wealth tax, Andorra appeals to investors and entrepreneurs.
• Exceptional Quality of Life: The country offers a secure environment, modern infrastructure, and an efficient healthcare system, creating an ideal setting to live and work.
• Geographical Proximity: Situated between France and Spain, Andorra provides easy access while offering a unique living environment.

These advantages have led to a significant increase in residency applications, particularly among digital workers and retirees.

2. Analysis of 2024: Notable Growth

Migration to Andorra has shown remarkable progress in 2024. The figures speak volumes:

• 15% Growth in Expatriates: Compared to 2023, the number of granted residencies has increased significantly, with arrivals primarily from Spain, France, and other European countries.
• Diversification of Profiles: While professionals in digital and financial sectors remain predominant, artists, families, and retirees represent a growing share of newcomers.
• Development in Key Sectors: Expatriates also boost tourism, which has seen a 20% increase in visitors, contributing to a positive economic dynamic.

3. Legislative Reforms: A Modernized Framework for Immigration

In 2024, the Andorran government introduced reforms to simplify administrative processes for foreign workers. Major developments include:

• Streamlined Residency Permits: Visa acquisition has been simplified to attract more skilled talent, with priority given to professions linked to new technologies and the green economy.
• Cultural Integration Support: Enhanced programs for learning Catalan, the official language, along with initiatives to promote newcomer integration, have been implemented.

These measures aim not only to attract talent but also to create an ecosystem where expatriates can thrive while actively participating in local society.

4. Real Estate Market: Challenges and Opportunities

Andorra’s real estate market experienced a pivotal year in 2024. With population growth, housing demand has surged, leading to price increases:

• 10% Price Growth: Regions like Andorra la Vella and Escaldes-Engordany remain the most sought after, with high demand for luxury apartments and upscale chalets.
• Affordable Housing Initiatives: In response to rising prices, the government has implemented policies to promote affordable housing construction and curb real estate speculation.

The real estate sector remains strategic, and these measures aim to balance economic attraction with quality of life.

5. Key Data: 2024 at a Glance

Some statistics highlight the magnitude of changes in Andorra:

• Population: Andorra surpassed 80,000 residents, 30% of whom are expatriates.
• Residency Permits: 3,200 new permits were issued, with a 75% renewal rate.
• Tourism: A 20% increase in visitor numbers, driven by international promotion campaigns.

6. Economic Prospects: A Solid Foundation for the Future

Andorra’s economic dynamism is supported by expanding sectors:

• Finance and Taxation: Fiscal appeal for companies and international investors continues to be a growth driver.
• Technological Innovation: Support for the digital economy and start-ups is fostering an ecosystem conducive to innovation.
• Economic Diversification: Green economy initiatives are laying the groundwork for sustainable development.

7. Challenges to Address

Despite these advances, Andorra faces certain challenges:

• Cost of Living: Rising real estate prices make housing access difficult for some families. The government must regulate the market to prevent inequalities.
• Social Integration: Adoption of Catalan and expatriates’ participation in local activities remain priorities for maintaining social cohesion.

8. Conclusion: A Year of Significant Transformation

In 2024, Andorra reaffirms its appeal as a prime destination for expatriation. Legislative changes, economic dynamics, and real estate developments reflect a period of transition and growth.

Looking ahead, the challenge will be to maintain a balance between economic growth and quality of life. If the government continues its efforts to improve housing accessibility and promote cultural integration, Andorra will remain a dream destination for those seeking to combine professional opportunities with an exceptional living environment.

Investing in Andorra is attracting an increasing number of international entrepreneurs and investors. This principality nestled in the Pyrenees offers an advantageous tax environment and a stable economic framework, ideal for business development. Whether you wish to invest in Andorra’s real estate sector, create your company, or diversify your assets, discover the numerous advantages this rapidly expanding territory has to offer.

Key Advantages of Investing in Andorra

Located in the heart of the Pyrenees, between France and Spain, the Principality of Andorra has become a privileged destination for international investors. With 86,000 inhabitants spread across 468 km², this territory combines political stability, economic growth, and an attractive tax framework, offering unique opportunities for entrepreneurs.

A Dynamic and Growing Economy

The Andorran economy shows remarkable health, as demonstrated by its exceptional growth of 8.8% in 2022 according to World Bank data. The tourism sector, a pillar of the local economy, attracts more than 9.25 million annual visitors, generating estimated revenues of 2.5 billion euros in 2023.

A Particularly Attractive Tax Regime

Andorra stands out for its advantageous taxation that appeals to investors:

• GST (VAT) at 4.5% on most goods and services
• Tax burden limited to less than 25% of GDP
• Corporate tax capped at 10%
• No tax on dividends
• No wealth tax
• Inheritance tax exemption for residents

Promising Investment Sectors

Real Estate: A Dynamic Market

The Andorran real estate sector presents unique characteristics:

• Reduced notary fees
• No property tax
• Numerous development opportunities
• Constantly evolving market

Growing Innovative Sectors

Andorra actively encourages investment in:

• Digital economy
• Renewable energy
• Sustainable tourism
• Healthcare services
• Financial technologies

Quality of Life and Modern Infrastructure

The principality offers an exceptional living environment characterized by:

• One of the highest standards of living in Europe
• An efficient healthcare system
• Free, high-quality education through high school
• A secure environment with an almost non-existent crime rate

Practical Aspects of Investment

Favorable Legal Framework

Foreign investors can:

• Own 100% of their company’s capital
• Benefit from a stable regulatory framework
• Access simplified administrative processes

International Relations

Although not a member of the European Union, Andorra benefits from:

• Numerous agreements with the EU
• The Euro as official currency
• Simplified cryptocurrency regulations
• The possibility to invest in neighboring countries through an Andorran company

Conclusion

Andorra establishes itself as a privileged destination for investors, combining tax advantages, political stability, and exceptional quality of life. The principality offers a conducive environment for business development, supported by a dynamic economy and diversified sectors of activity.

To succeed with your investment in Andorra, it is recommended to work with experienced professionals who master the specificities of the local market and can guide investors through their administrative and strategic procedures.

Setting up a company in Andorra is attracting an increasing number of entrepreneurs drawn to its advantageous tax system and exceptional quality of life. In this detailed guide, discover all the steps to create your company in this business paradise nestled between France and Spain.

Why Choose Andorra for Your Business?

Andorra has established itself as a prime destination for entrepreneurs thanks to its numerous advantages. At the heart of its attractiveness lies a particularly advantageous tax regime that allows businesses to develop under optimal conditions.

Key tax benefits include:

• Corporate tax capped at 10% (reducible to 2% under certain conditions)
• VAT (IGI) at 4.5%, the lowest rate in Europe
• Social security contributions capped at 22%
• Advantageous tax treaties with numerous countries

Beyond its attractive taxation, Andorra offers an exceptional living environment characterized by:

• Recognized political and economic stability
• An efficient healthcare system
• A preserved natural environment
• One of the highest life expectancies in the world
• A quality education system

Legal Structures at Your Disposal

The Andorran legal system offers several types of companies, each adapted to different types of business projects. Understanding these options is essential to make the most suitable choice for your situation.

Limited Liability Company (SL)

This structure has the following characteristics:

• Minimum capital: €3,000
• Liability limited to contributions
• Possibility of creation as a single-member company (SLU)
• Simplified management
• Ideal for small and medium-sized businesses

Public Limited Company (SA)

Designed for more ambitious projects, the SA is distinguished by:

• Minimum capital of €60,000
• A structure adapted to large companies
• Easier fundraising capabilities
• Option for single-member company (SAU)
• More formalized governance

The Creation Process: A Five-Stage Journey

Creating a company in Andorra follows a structured process that requires careful preparation. Here are the key steps to successfully establish your business.

1. Company Name

This first step is crucial for your company’s identity. The process involves:

• Proposing three names in order of preference
• Validation by authorities within 10 days
• Verification of name availability

2. Investment Authorization

For non-residents, this step is fundamental:

• Processing time: 10 to 15 days
• Detailed project file required
• Verification of financial capabilities
• Business plan validation

The process of obtaining investment authorization requires particular attention, as it conditions the continuation of your project. Andorran authorities carefully examine each file to ensure its viability and compliance with local regulations.

3. Opening a Bank Account

This step requires:

• Choosing an Andorran bank
• Preparing a complete banking file
• Depositing statutory capital
• Processing time of 1 to 4 weeks

4. Constitution and Registration

This phase formalizes your company’s creation through:

• Drafting and signing articles of association before a notary
• Registration in the commercial registry
• Obtaining a tax identification number
• Implementation of official documents

Residency in Andorra: An Opportunity to Seize

Establishing a company in Andorra can open the door to Andorran residency. This opportunity presents numerous advantages for entrepreneurs who wish to establish themselves in the Principality.

Main conditions for obtaining residency:

• Owning at least 21% of company shares
• Exercising effective activity in the company
• Demonstrating sufficient financial means
• Residing at least 183 days per year in Andorra

Conclusion

Creating a company in Andorra represents a strategic opportunity for entrepreneurs seeking to combine tax optimization with quality of life. While the process is clearly structured, it requires careful preparation and a good understanding of local specificities. Professional guidance can be valuable in effectively navigating the different stages and ensuring successful establishment in the Principality.

Remember that each project is unique and deserves particular attention. Take the time to carefully evaluate your objectives and plan each stage of your establishment in Andorra to maximize your chances of success.

Nestled between France and Spain, this 468 km² micro-state offers an exceptional living environment to its 76,177 inhabitants. With an average life expectancy of 83.5 years, Andorra is one of the best countries in the world to live in. The country harmoniously combines Pyrenean tradition and modernity, while preserving a spectacular natural environment.

Quality of life and incomparable safety

According to the latest study by Numbeo, the world’s largest database on living conditions, the Principality of Andorra is the safest country in the world. This recognition is based on rigorous hard and comparative data, encompassing various aspects of daily life such as housing, health, traffic, crime, cost of living and pollution.

Remarkable statistics

• Crime Index: 12.87 (exceptionally low)
• Safety Index: 87.13% (highest in the world)
• Population: 76,177 inhabitants (2019 census)

Comparison at the level of wider Europe (2024)

See the full 2024 global crime index ranking
(opens in a new tab)

Impact on Quality of Life

These excellent safety results contribute significantly to the exceptional quality of life in Andorra, which is particularly remarkable for a country of this size. This security performance reinforces the attractiveness of the Principality, both for its residents and for international investors.

• Quality of life for residents
• The stability of the real estate market
• Investment security

This privileged security location is therefore a major asset for Andorra, especially in attracting investors looking for a stable and safe environment for their assets.

A particularly advantageous tax regime

Andorran taxation appeals to informed investors:

• VAT (IGI) among the lowest in Europe at 4.5%
• Progressive and advantageous income taxation:
  • 0% up to €24,000 per year
  • 5% from €24,001 to €40,000
  • 10% over €40,000
• No inheritance or wealth tax
• Tax exemption of bank interest up to €3,000 per year

A paradise for winter sports enthusiasts

As a homeowner in Andorra, you have privileged access to:

• More than 300 kilometres of slopes spread over three major areas
• First-class facilities in Grandvalira, Ordino-Arcalís and Vallnord-Pal Arinsal
• Diversified activities: cross-country skiing in Naturland, tubbing, winter hiking, snowmobiling
• Modern facilities open all year round

Real estate investment opportunities

Rental investment: a safe bet

The Andorran rental market offers several profitable strategies:

Year-round residential rentals

• Stable local demand
• Consistent returns
• Minimal rental risk due to the high purchasing power of residents

Vacation rentals

• High demand during the ski season
• Attractive rates in high season
• Summer rental potential for mountain activities

Prestigious properties

Spread over the 7 historic parishes (Andorra la Vella, Canillo, Encamp, Escaldes-Engordany, Sant Julià de Loria and Ordino), the high-end properties offer:

• Stable valuation over time
• Customization opportunities
• A niche market with international demand

Alternative investments

Parking

• Moderate initial investment
• Stable and predictable profitability
• Simplified management
• Consistent demand year-round

Commercial premises

• High return potential
• Secure commercial leases
• Valuation linked to the country’s economic dynamism

Maximize the return on your investment

The different performance levers

1. Rental income

• Strategic choice of location
• Optimization of the type of rental according to the season
• Professional management of the property

2. Potential capital gains

• Selection of developing areas
• Renovation and improvement of the property
• Anticipating market developments

3. Tax benefits

• Optimal investment structuring
• Use of available tax arrangements
• Long-term wealth planning

The acquisition process in Andorra

Conditions and procedures

To become a homeowner in Andorra, you must:

• Be of legal age
• Provide an extract from the criminal record (for foreigners)
• Opening a bank account in an Andorran bank
• Submit a Foreign Investment Application

Clickand’s expert support

Clickand stands out for its personalized support throughout your project:

Preparatory phase

• In-depth analysis of your investment objectives
• Personalized market research
• Rigorous pre-selection of properties according to your criteria

Acquisition phase

• Expert negotiation
• Comprehensive administrative support
• Coordination with the various stakeholders

Post-acquisition follow-up

• Rental management advice
• Continuous tax optimization
• Monitoring the performance of your investment

Conclusion

Investing in real estate in Andorra represents a unique opportunity to combine exceptional quality of life, advantageous taxation and attractive return potential. Whether you opt for an apartment, a prestigious chalet or a rental investment, the key to success lies in quality professional support.

With Clickand, benefit from in-depth expertise in the Andorran market and a tailor-made service to make your investment project a reality in the best conditions. Our experienced consultants guide you every step of the way, from finding the perfect property to continuously optimizing your investment.

Unlock New Opportunities by Establishing Your Company in Andorra

Andorra, a small principality nestled between France and Spain, offers an exceptional living environment and an attractive tax framework for entrepreneurs. With its dynamic financial sector and low tax burden, establishing a company in Andorra is an excellent option for those looking to develop their business in a favorable environment. In this article, we’ll guide you through the advantages, steps, and costs associated with creating a company in the Principality of Andorra.

Multiple Benefits of Creating a Company in Andorra

Advantageous Corporate Tax Rate

One of Andorra’s main attractions for entrepreneurs is its corporate tax rate of just 10%. Compared to the OECD average of 23.5% or rates like 21% in the United States and 19% in the United Kingdom, this represents a significant advantage. Furthermore, depending on your activities, you’ll be exempt from many contributions in Andorra, where only a few fixed annual government taxes need to be paid.

Among the Lowest Social Security Contributions in Europe

As an active resident in Andorra, you must participate in the social security system and pay social contributions. However, these charges are significantly lower than those in most developed countries. Since 2020, mandatory social security contributions for self-employed business leaders have been fixed at €468 per month, regardless of income level. This compares favorably to countries where charges can represent up to 40-45% of remuneration.

Optimize Your Costs with an Andorran Company

Qualified Workforce at Competitive Costs

In Andorra, average loaded salaries amount to approximately €2,200. This gives you access to a highly qualified workforce at costs 20-40% lower than in most Western European countries or major US cities. This difference allows you to invest more in developing your company, optimizing your return on investment.

Advantageous Cost of Living for Entrepreneurs

When establishing your company in Andorra, you’ll notice an automatic increase in your disposable income while reducing expenses. Consumer goods are untaxed, and VAT is only 4.5%, resulting in a significantly lower cost of living compared to most developed countries.

Leverage Andorra’s Multilingual Environment for Business Development

Privileged Access to Multiple Markets

Thanks to Andorra’s multilingual environment, your company will benefit from direct access to European, Latin American, and international markets. While Catalan is the principality’s official language, most of the population is fluent in Spanish, French, English, and Portuguese. This linguistic diversity is a major advantage for companies looking to establish themselves in these promising markets.

Key Steps in Creating an Andorran Company

Company Name Reservation

The first step involves reserving a company name with the Andorran government. You’ll need to propose three different names for your company, in order of preference. If a name is already in use, the administration will automatically reserve the next one on your list.

Obtaining Foreign Investment Authorization

Since the Foreign Investment Law of June 21, 2012, non-Andorran investors can own 100% of a company’s capital in Andorra. You’ll need to prepare a foreign investment file and submit it in person to the government.

Opening an Andorran Bank Account

Opening a bank account is a crucial step for creating your company and obtaining residency in Andorra. Before registering your company, you’ll need to deposit your share capital in this account.

Signing Articles of Association Before a Notary

Your company’s official establishment will be formalized when signing the articles of association before an Andorran notary. This step is mandatory and must be completed in the principality.

Registration in the Companies Registry

Once the articles are signed, you must register your company in the Andorran Companies Registry. This is when it acquires its legal personality. Registration fees amount to €1,016.67 for an LLC and €1,480 for a Corporation. An annual fee of €214.21 is also required if your company is registered in the Trade and Industry Registry.

Additional Administrative Procedures

Obtaining Business License from the Municipality

After creating your company, you must obtain a business license from the municipality where it will be located. This process notably requires declaring your electricity contract number and fire extinguisher maintenance contract, both mandatory elements.

Registration with the Andorran Social Security Fund (CASS)

All self-employed individuals must register with CASS within three days of starting their activity. This step is essential to benefit from Andorran social security coverage.

Labor Costs in Andorra: An Advantage for Entrepreneurs

A Simplified and Advantageous System

The social security system in Andorra only has two branches: health and retirement. The absence of unemployment insurance provides employees with stable financial situations and job security. Payroll costs related to social security are particularly attractive, with a rate of 14.5% for employers and 5.5% for employees.

Competitive Salaries

In Andorra, the average monthly salary is approximately €1,950 for a 40-hour week. The minimum wage is set at €1,017.47 per month. These remuneration levels, combined with low social security contributions, allow companies to control their costs while offering attractive conditions to their employees.

Accounting and Social Contributions in Andorra

Business-Friendly Accounting Requirements

The Andorran accounting system is known for its transparency and administrative simplicity. Here are the main obligations to be aware of:

• Accounting in accordance with International Financial Reporting Standards (IFRS)
• Annual preparation of financial statements including:
  • Balance sheet
  • Income statement
  • Cash flow statement
  • Notes to the accounts
• Filing of annual accounts with the Companies Registry within 6 months of year-end
• Retention of accounting documents for 6 years

Audit and Control

An external audit becomes mandatory when your company meets at least two of the following criteria for two consecutive years:

• Balance sheet total exceeding €3.6 million
• Net turnover exceeding €6 million
• Average workforce exceeding 25 employees

A Modern and Advantageous Social Security System

Andorra offers a balanced social protection system that combines efficiency and controlled costs for businesses.

Contribution Structure

• Employer contribution: 14.5% of gross salary
  • 7.5% for health insurance
  • 7% for retirement
• Employee contribution: 5.5% of gross salary
  • 3% for health insurance
  • 2.5% for retirement

System Benefits

• Contributions capped at 22% of total payroll
• No additional unemployment insurance charges
• Comprehensive social coverage including:
  • Health and maternity insurance
  • Retirement pension
  • Disability coverage
  • Workplace accident insurance
• Fully digitized declaration and payment procedures

For Self-Employed Workers

Individual entrepreneurs and company directors benefit from a specific regime with:

• A fixed monthly contribution of €468
• Option to choose a higher contribution base for improved coverage
• Simplified registration with CASS (Andorran Social Security Fund)

This system offers an excellent cost-to-protection ratio, allowing companies to control their social security costs while ensuring quality social protection for their employees. Administrative simplicity and cost predictability are major advantages for entrepreneurs looking to establish themselves in Andorra.

Launch Your Andorran Company Today

Creating a company in Andorra offers numerous advantages for entrepreneurs, both in terms of taxation and labor costs. With a simplified system and clear administrative procedures, the principality stands out as a destination of choice for foreign investors looking to develop their business in a favorable environment. Don’t wait to seize this opportunity and start creating your company in Andorra today!

Make an appointment with an expert

To offer you an expert overview of the opportunities that Andorra offers for expatriation and tax optimisation, we are pleased to present you with an exclusive interview with Joan-Francesc Montané Debiais, our tax expert and founder of Gestoria Clickand, which is based in Escaldes Engordany.

Q: Mr. Montané Debiais, can you explain to us what makes Andorra so attractive for entrepreneurs?

JFM: Andorra’s appeal is based on several pillars. Our tax system is remarkably simple and advantageous, with only four main taxes. Corporate tax is at 10%, income tax is capped at 10%, and we have no tax on dividends or inheritance. This tax structure, combined with our political and economic stability, makes Andorra a destination of choice for long-term wealth management.

Q: How does Andorra compare to other tax-advantaged destinations?

JFM: Unlike some destinations, Andorra remains accessible to a wide range of economic profiles. We welcome digital entrepreneurs as well as innovative startups and international holding companies. Our major asset is the balance between attractive taxation and an exceptional quality of life, with a high level of security and a preserved natural environment.

Q: Let’s talk about residency options. Can you explain the differences between active and passive residence?

JFM: This is a crucial point that is often underestimated by future expatriates. Active residency is intended for people who wish to carry out an economic activity in Andorra. This involves the creation of an Andorran company, which will have to generate a turnover and pay local taxes.

Passive residency, on the other hand, does not allow you to work in Andorra. It requires a minimum investment of €600,000, which can take different forms: real estate purchase, financial investment, or participation in the capital of an Andorran company.

Q: How do you advise your clients in choosing between these two options?

JFM: At Clickand, we take a very personalized approach. It is essential to have a clear understanding of the client’s project, their financial means, and their long-term goals. Let’s take the example of a retired couple who want to move to Andorra. The generalist approach would be to recommend a passive resident status. However, if this couple intends to actively manage their financial and real estate assets, it may be more advantageous for them to opt for the status of active residents by creating a patrimonial company.

That’s why we never generalize. Each situation is unique and deserves a thorough analysis. In some cases, we may even recommend starting as a non-resident before considering a full expatriation.

Q: How do you see the Andorran tax landscape evolving in the coming years?

JFM: Although Andorra remains very attractive, we anticipate a gradual evolution of our reception policy. The reception capacity of our small country is not unlimited, and it is likely that the conditions of entry will become stricter in the near future. That’s why we advise interested entrepreneurs to seriously consider moving abroad now, rather than waiting.

Q: What are the specific advantages for holding companies in Andorra?

JFM: Andorra has become a destination of choice for international holding companies. With a dividend tax of 0% and double taxation treaties with 17 countries, we offer an ideal framework for international asset management. In addition, Andorra’s political and economic stability reassures investors in the long term.

Q: Let’s talk about the Andorran banking sector. What are its strengths?

JFM: Our banking sector is robust, with a solvency ratio of 17% at the end of 2023, above the European average. Andorran banks offer investment opportunities usually reserved for institutional investors in other countries. Since the lifting of banking secrecy in 2016-2017, we have gained credibility on the international scene while maintaining our attractiveness for private investors.

Q: What advice would you give to French entrepreneurs who are considering expatriation to Andorra?

JFM: Firstly, it is crucial to prepare well for your tax exit from France. This is an often overlooked but essential point. Secondly, it is important to understand that Andorra is not a tax haven, but a real place to live. To take full advantage of the tax advantages, you must be prepared to spend more than 183 days a year there and establish your economic interests there.

At Clickand, we support our customers every step of the way. We help them evaluate their options, understand the tax and legal implications of each choice, and set up the most appropriate structure for their situation.

Q: A final word on real estate in Andorra?

JFM: The Andorran real estate market remains very dynamic, driven by real demand for housing rather than speculation. The scarcity of land and the constant influx of new residents are keeping upward pressure on prices. It is therefore an interesting sector for investors, especially since rental income also benefits from advantageous taxation.

Andorra offers a unique environment combining attractive taxation, quality of life and investment opportunities. However, the window of opportunity could tighten in the coming years, making the current time particularly good to consider expatriation or investment in the principality.

At Clickand, we are your trusted partner to navigate the complex waters of tax optimization and expatriation in Andorra. Our team of experts in financial and accounting management accompanies you at every stage of your project, from the creation of a company to property management, including the subtleties of expatriation and tax optimization.

The Principality of Andorra has built a reputation as a sought-after destination for international investors looking to invest in Europe. With its robust financial system, advantageous tax regime, and political stability, Andorra offers a conducive environment for various types of investments. In this article, we will explore the multiple facets of investing in Andorra, emphasizing the security and opportunities offered to foreign investors.

The Andorran Financial Sector: A Pillar of Trust for Investing in Europe

A Centenary Banking Tradition

The Andorran banking sector, with over 90 years of experience, forms the backbone of the country’s financial system. Andorran banks have adopted a universal banking model, offering a full range of services:

• Commercial banking
• Private banking
• Asset management
• Specialized banking services

This versatility allows financial institutions to effectively meet the diverse needs of local and international investors.

A Robust Regulatory Framework

The Andorran Financial Authority (AFA) rigorously supervises the sector, ensuring compliance with international standards for transparency and anti-money laundering. This strict oversight strengthens foreign investors’ confidence in the Andorran financial system.

Cutting-edge Banking Services

Andorran banks offer a wide range of services to international investors:

• Multi-currency accounts
• Personalized wealth management
• Tailored financing solutions
• Financial analysis and investment advice
• Advanced digital banking services

Investment Opportunities in Andorra

1. Real Estate Investment

The Andorran real estate market presents attractive opportunities for foreign investors:

• Luxury residences in renowned ski resorts
• Commercial properties in booming urban areas
• High-potential real estate development projects

Tax advantages: Non-residents benefit from a reduced tax rate on real estate capital gains after a certain number of years of ownership.

2. Company and Holding Creation

Andorra offers a favorable framework for business creation:

• Simplified incorporation procedures
• Competitive corporate tax rates (generally 10%)
• Access to the European market through trade agreements

Types of structures:

• Public Limited Company (SA)
• Limited Liability Company (SL)
• Branch of a foreign company

3. Investment in Securities and Financial Assets

Investors can access a wide range of financial instruments:

• Stocks listed on international markets
• Sovereign and corporate bonds
• Diversified investment funds
• Structured products

Andorran banks offer sophisticated trading platforms and access to major global stock exchanges.

4. Insurance and Provident Products

The insurance sector in Andorra offers innovative solutions for wealth protection and optimization:

• Life insurance with flexible investment options
• Private pension products
• Tailored wealth insurance

These products can offer interesting tax advantages, especially for non-residents.

Tax Advantages for Investors

Andorra maintains an attractive tax regime for foreign investors:

• No wealth tax
• No inheritance and gift tax for residents
• Personal income tax capped at 10%
• Double taxation agreements with several countries

Residence and Investment

Andorra’s investment-based residence program offers a privileged access route for investors wishing to establish themselves in the Principality:

• Minimum required investment: €400,000 in the Andorran economy
• Access to a quality lifestyle and secure environment
• Possibility of obtaining Andorran nationality after 20 years of residence

Security and Stability: Andorra’s Major Assets

Political and Economic Stability

With over 700 years of peaceful history, Andorra offers a stable and secure environment for long-term investments. The ongoing diversification of the Andorran economy, beyond tourism and retail, strengthens its resilience.

Confidentiality and Data Protection

While complying with international transparency standards, Andorra maintains a high level of privacy and personal data protection, a crucial aspect for many wealthy investors.

Future Prospects

The Andorran financial sector is actively preparing for future challenges:

• Increased digitalization: Adoption of blockchain technologies and artificial intelligence to improve financial services.
• Sustainable finance: Development of ESG (Environmental, Social, and Governance) investment products.
• Regulatory innovation: Continuous adaptation of the legal framework to attract new types of investments, particularly in technological sectors.

Clickand: Your Privileged Partner for Investing in Andorra

In the Andorran financial landscape, Clickand stands out as a key player for international investors. This gestoria offers a comprehensive range of services tailored to the specific needs of foreign investors, facilitating their establishment and development in Andorra.

Strategic Banking Partnerships

Clickand has established solid partnerships with major Andorran banks, offering its clients privileged access to local banking services:

• Personalized support for opening bank accounts
• Facilitation of banking procedures for non-residents
• Negotiation of advantageous conditions for Clickand clients
• Assistance in international financial transactions

These close relationships with the Andorran banking sector allow Clickand to offer a smooth and efficient service to its investor clients.

Tailored Tax and Accounting Expertise

Clickand distinguishes itself by its offer of highly personalized tax and accounting services:

• International tax advice: optimization of tax structure for foreign investors
• Accounting expertise adapted to international standards
• Assistance in preparing and filing tax returns
• Regulatory monitoring to ensure continuous compliance of investments

Clickand’s team of experts offers tailor-made solutions, taking into account the specificities of each investor and the complexity of the international tax context.

Real Estate Investment Solutions

Clickand offers comprehensive support for real estate investments in Andorra:

• Identification of premium investment opportunities
• Thorough due diligence on real estate properties
• Legal assistance for real estate transactions
• Rental management for investment properties
• Tax optimization advice related to real estate

Thanks to its in-depth knowledge of the local market, Clickand guides its clients towards the best real estate investment opportunities in Andorra.

Tailored Insurance Products

Clickand also offers a range of insurance solutions adapted to the needs of international investors:

• International life insurance with flexible investment options
• Wealth protection products
• Insurance for professional and personal asset protection
• Health insurance solutions

These insurance products are carefully selected and structured to meet the specific requirements of foreign investors, offering optimal protection for their assets.

Comprehensive and Personalized Support

Clickand’s approach is characterized by a holistic service, covering all aspects of investment and establishment in Andorra:

• Assistance with administrative and immigration procedures
• Connection with a network of local professionals (lawyers, notaries, etc.)
• Strategic advice for investment optimization
• Continuous monitoring and long-term support

By choosing Clickand as a partner, investors benefit from a one-stop-shop for all their needs related to their activities in Andorra, significantly simplifying their investment journey in the Principality.

Conclusion

Andorra positions itself as a choice investment destination in Europe, offering a unique balance between tax advantages, political stability, and growth opportunities. Whether for real estate, business creation, securities investment, or wealth management, the Principality offers a favorable and secure environment for international investors.

With its robust financial sector, transparent regulatory framework, and positive economic outlook, Andorra continues to attract investors from around the world, promising a prosperous future in the heart of the Pyrenees.

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Imagine a country where entrepreneurship is celebrated, taxes are low, and the quality of life is exceptional. This is not a dream, it’s the reality in Andorra. The Principality of Andorra, long known for its ski slopes and duty-free shops, is rapidly becoming a dynamic hub for entrepreneurs from around the world. With one of the lowest corporate tax rates in Europe and a business-friendly regulatory framework, Andorra offers a unique opportunity for foreigners looking to start their business in a stimulating and prosperous environment.

Whether you are an ambitious start-upper, a seasoned entrepreneur, or simply looking for a new professional challenge, this guide will unveil the key steps, essential documents, anticipated costs, and tax benefits that make Andorra a top destination for your next business adventure. Get ready to dive into the secrets of starting a business in Andorra and discover how to turn your vision into reality in this business haven in the heart of Europe.

1. Choose the legal structure of your company

The first crucial step is to determine the most suitable legal structure for your project. In Andorra, the most common forms for foreigners are:

• Societat Limitada (SL): equivalent to a limited liability company (LLC).
• Societat Anònima (SA): equivalent to a joint-stock company (JSC).
• Sole proprietorship.

Each form has its pros and cons in terms of liability, taxation, and management. It is recommended to consult a local expert to make the best choice.

2. Obtain a residence permit

To start a business in Andorra, you first need to obtain a residence permit. There are several types of permits, but for entrepreneurs, the most suitable is usually the passive residence permit. This permit requires:

• A minimum investment of €400,000 in the Andorran economy.
• Proof of sufficient resources to live in Andorra.
• A clean criminal record.
• Valid health insurance in Andorra.

3. Draft the company’s articles of association

Once you have chosen the legal structure and obtained the residence permit, you must draft the company’s articles of association. This document should include:

• The name of the company.
• The corporate purpose.
• The share capital.
• The distribution of shares.
• Management procedures.

4. Open a bank account

Opening a bank account in Andorra is an essential step. You will need to provide:

• A copy of your passport.
• Proof of residence.
• The company’s articles of association.
• A business plan.

The process may take several weeks due to thorough checks carried out by Andorran banks.

5. Register the company

Company registration is done with the Andorran Companies Registry. You will need to provide:

• The company’s articles of association.
• Proof of the opening of a bank account.
• Evidence of the capital deposit.
• Copies of the partners’ identification documents.

The processing time is usually 2 to 3 weeks.

6. Obtain necessary licenses

Depending on your business activity, you may need specific licenses. For example, retail businesses must obtain a commercial license from the Comú (town hall) of their parish.

7. Register with tax and social authorities

Once your company is registered, you must register with:

• The Ministry of Finance to obtain a tax number.
• The Caixa Andorrana de Seguretat Social (CASS) for social security contributions.

Costs associated with starting a business in Andorra

Starting a business in Andorra involves several types of costs that are important to factor into your budget:

Administrative fees:

• Registration fees: around €1,000.
• Notary fees: around €500.
• Legal fees: variable, usually between €1,500 and €3,000.

Share capital:

• For a Societat Limitada (SL): minimum €3,000.
• For a Societat Anònima (SA): minimum €60,000.

Mandatory deposits:

• Security deposit for the residence permit: €50,000 per adult family member.

This amount is locked in an Andorran bank for the duration of your residence.

Accommodation costs:

• Rent: budget between €800 and €2,000 per month depending on size and location.
• Purchase: prices vary widely, but on average range between €3,000 and €6,000 per square meter.

Don’t forget to include associated costs (utilities, taxes, insurance).

Other costs to consider:

• Mandatory health insurance: around €800 to €1,500 per year per person.
• International moving expenses.
• School fees if you have children.

It is important to note that these costs may vary depending on your personal situation, the size of your business, and your accommodation choices. It is recommended to include a safety margin in your budget to cover unforeseen expenses.

Additionally, some of these costs, such as the security deposit for the residence permit, are refundable at the end of your stay in Andorra under certain conditions.

The language challenge: the importance of Catalan

A crucial aspect to consider when starting a business in Andorra is the language barrier. Catalan is the official language of Andorra and is used in all administrative, legal, and commercial documents. For foreign entrepreneurs who do not speak the language, this can be a major challenge throughout the business creation process.

• All official forms are in Catalan.
• Communications with administrations are mainly in Catalan.
• Contracts and legal documents are written in Catalan.

This linguistic reality underscores the importance of relying on local experts who can not only translate but also correctly interpret the cultural and legal nuances inherent in the language.

Tax advantages for businesses in Andorra

Andorra offers a highly attractive tax environment:

• Corporate tax: 10% (one of the lowest in Europe).
• VAT (IGI): 4.5% (standard rate).
• No tax on dividends.
• Double taxation agreements with several countries.

Clickand: Your global partner for business creation in Andorra

Faced with the complexity of the process and the language challenge, Clickand is the ideal solution for foreign entrepreneurs looking to establish themselves in Andorra. This gestoria offers much more than just support: it provides comprehensive management of your project, tailored to your specific goals.

Complete services from Clickand:

• Language management: Translation and interpretation of all documents and communications in Catalan.
• Administrative support: Handling all procedures with Andorran authorities.
• Legal advice: Assistance in drafting the articles of association and legal compliance.
• Banking support: Help with opening accounts and banking relations.
• Real estate management: Assistance with renting or buying properties.
• Customized packages: Tailored offers based on your specific business needs and goals.
• Moving assistance.
• Importing your vehicles.

Clickand offers different global management packages, ranging from basic assistance to full project management. These packages may include:

• The preparation and follow-up of your residence file.
• The legal creation of your company.
• Accounting and tax management.
• Assistance in finding commercial premises or housing.
• Recruitment of local staff if necessary.

By choosing Clickand, you will have a single point of contact composed of accounting and tax experts who coordinate all aspects of your business setup and company creation in Andorra. This allows you to focus on your core business while Clickand handles the administrative, legal, and linguistic complexities.

Thanks to its network of local experts and its in-depth knowledge of the Andorran system, Clickand guarantees you a smooth transition to entrepreneurship in Andorra, regardless of your goals and industry.

Conclusion

Starting a business in Andorra as a foreigner may seem complex, but with proper preparation and the help of professionals like Clickand, it is a process that can prove highly beneficial. The steps are clear, the costs are reasonable, and the tax advantages are significant.

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The transfer of capital from France to Andorra is an operation that is garnering increasing interest among investors and individuals seeking to optimize their tax situation. In this article, we will explore the various fiscal solutions available to carry out this transfer legally and advantageously in 2024.

Why Transfer Capital to Andorra?

Andorra, a small principality nestled between France and Spain, is recognized for its attractive tax regime. The main advantages include:

1. Low tax rates on income and corporations
2. No wealth tax
3. Enhanced banking confidentiality
4. Political and economic stability

These factors make Andorra a popular destination for investors looking to optimize their assets.

Different Methods of Capital Transfer

1. Traditional Bank Transfer

Bank transfer remains the most common method. However, it is crucial to respect certain rules:

• Declare transfers exceeding €10,000 to French authorities
• Ensure that the origin of the funds is legal and justifiable

2. Creating a Company in Andorra

Creating a company in Andorra can facilitate the transfer of capital in the form of investment. The advantages include:

• A corporate tax rate of only 10%
• The possibility of receiving lightly taxed dividends

Clickand can assist you in all stages of creating your Andorran company, from incorporation to accounting management.

3. Real Estate Investment

Buying real estate in Andorra is an excellent way to transfer capital while investing. The benefits are numerous:

• No property tax in Andorra
• Low taxation on real estate capital gains
• Possibility of obtaining a residence permit through investment

Our team of experts at Clickand can guide you in selecting and acquiring real estate in Andorra.

Fiscal Aspects to Consider During Transfer

Declaration of Foreign Accounts

French tax residents must declare their foreign bank accounts, including those in Andorra. Failure to comply with this obligation can result in heavy fines.

French Exit Tax

If you’re considering transferring your tax residence to Andorra, be aware of the French exit tax. This tax applies to unrealized capital gains on your movable assets if they exceed €800,000.

France-Andorra Tax Convention

The tax convention between France and Andorra, which came into force in 2015, provides provisions to avoid double taxation. It is crucial to understand these provisions well to optimize your tax situation.

Tax Optimization Strategies

1. Tax Residence Planning

Choosing the right moment to change your tax residence can have a significant impact on your tax obligations. Clickand can help you plan this transition optimally.

2. Asset Structuring

Setting up an appropriate asset structure (holding company, trust, etc.) can offer significant tax advantages. Our tax experts at Clickand can advise you on the best structure for your situation.

3. Investment Diversification

Distributing your capital among different types of investments in Andorra (real estate, business, financial investments) can optimize your overall tax situation.

Risks and Precautions to Take

Legal Compliance

It is essential to ensure that all transfers and investments are made in compliance with French and Andorran laws. Clickand ensures that all operations are perfectly legal and transparent.

Banking Due Diligence

Andorran banks apply strict due diligence procedures. It is essential to be able to justify the origin of your funds and provide all necessary documents.

Legislative Evolution

Tax laws are subject to change. It is important to stay informed about legislative changes in France and Andorra. Our experts at Clickand maintain constant legal monitoring to keep you informed.

Conclusion: The Importance of Expert Guidance

Transferring capital from France to Andorra offers numerous opportunities for tax optimization. However, it is a complex operation that requires careful planning and expert knowledge.

At Clickand, our team of tax experts, accountants, and legal professionals is at your disposal to guide you through every step of your project. We ensure personalized support to maximize tax benefits while strictly respecting legality.

Don’t hesitate to contact us for a personalized consultation and discover how we can help you optimize your capital transfer to Andorra.

In a world where geographical flexibility and tax optimization have become major issues for many investors and entrepreneurs, Andorra is emerging as an increasingly attractive option. This European micro-state, which has long remained discreet, is now a destination of choice for real estate investment, offering a unique balance between tax advantages, quality of life and economic opportunities.

An advantageous tax regime in the heart of Europe

Andorra stands out for its tax system that is particularly favourable to residents and investors. The principality has implemented a tax policy that encourages investment and entrepreneurship, while maintaining a high level of public services. Income tax, capped at 10%, is significantly lower than the rates applied in most European countries. This attractive tax system is accompanied by an absence of wealth tax and a VAT set at only 4.5%, contributing to a particularly competitive cost of living.

It is important to emphasize that this advantageous tax system is part of a legal and transparent framework. In recent years, Andorra has made significant efforts in the area of international tax cooperation, thus strengthening its credibility on the world economic scene. This development has enabled the country to position itself as a stable and reliable business environment, attracting investors looking for legal and tax security.

Real estate, the keystone of the Andorran residence

Acquiring a property in Andorra can serve as a springboard to obtaining residency status, opening the door to many advantages. The country offers two main residency options, each tailored to different investor profiles.

The passive residence, ideal for retirees or holders of passive income, requires a real estate investment of at least 500,000 euros, supplemented by a deposit of 50,000 euros with the Andorran National Institute of Finance. This option offers great flexibility, with a minimum residency requirement of 90 days per year, allowing you to enjoy the country’s benefits while maintaining freedom of movement.

For entrepreneurs and active professionals, active residence is an interesting alternative. It involves the creation of a company in Andorra and the holding of at least 20% of its capital. This option is particularly attractive for those looking to develop an economic activity while benefiting from a favourable tax framework.

A dynamic and promising real estate market

The Andorran real estate sector offers interesting prospects for investors. Prices per square metre, although rising, remain competitive compared to those of major European cities, suggesting a potential for significant capital gains in the medium and long term.

Rental demand, stimulated by tourism and the influx of new residents, provides owners with attractive return prospects. The Andorran real estate stock is characterised by its quality, with many recent or renovated buildings, often located in exceptional natural settings, thus combining modern comfort and the beauty of the Pyrenean landscape.

An incomparable quality of life

Beyond the financial advantages, Andorra seduces with its exceptional living environment. The country offers an unspoilt natural environment, ideal for mountain sports and nature enthusiasts. The Andorran healthcare system, renowned for its quality and efficiency, as well as one of the lowest crime rates in Europe, contributes to a sense of security and well-being that is much appreciated by residents.

For families, Andorra has a high-performance education system, including international schools that facilitate the integration of expatriate children. This combination of factors makes Andorra a destination of choice for those looking to combine quality of life with investment opportunities.

A simplified purchasing process

Contrary to popular belief, buying a property in Andorra is a relatively simple and transparent process. The procedure begins with obtaining a purchase authorization from the Andorran government, followed by the signing of a preliminary contract and the payment of a deposit. The transaction is finalized before an Andorran notary, thus guaranteeing the legal security of the operation.

The taxation related to the purchase and ownership of a property in Andorra is also advantageous, with reduced transfer taxes and the absence of annual property tax. In addition, the taxation of real estate capital gains is degressive according to the length of time the property has been held, thus encouraging long-term investments.

Conclusion: an investment in the future

Investing in real estate in Andorra represents a unique opportunity to diversify your assets in an economically and politically stable environment, while benefiting from advantageous taxation and an exceptional quality of life.

Whether you are considering the purchase of a second home, a rental investment or a change of life, Andorra deserves serious consideration. Its favourable legal framework, its preserved environment and its strategic position in the heart of Europe make it a particularly attractive investment destination.

As with any investment project abroad, it is recommended that you do your homework and surround yourself with local professionals to carry out your project. With the right preparation, buying an apartment in Andorra can not only prove to be an excellent financial investment, but also the beginning of a new and rewarding life adventure.

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Are you looking for a country with an attractive tax system? Discover the tax advantages of Andorra. This small country in the Pyrenees offers an advantageous tax system for individuals and companies. Let’s explore in detail the different taxes in Andorra and their specificities.

The main taxes in Andorra

Andorra applies three main types of taxes:

1. IGI (General Indirect Tax)
2. IRPF (Personal Income Tax)
3. IS (Corporate Tax)

IGI: Andorran VAT

The IGI, equivalent to VAT, applies at various rates:

• Standard rate: 4.5%
• Super-reduced rate: 0% (education, health)
• Reduced rate: 1% (food, water)
• Special rate: 2.5% (transport, culture)
• Bank rate: 9.5%

These advantageous rates stimulate consumption and the local economy.

IRPF: Attractive income tax

Income taxation in Andorra is progressive:

• 0% up to €27,000
• 5% between €27,000 and €43,000
• 10% over €43,000

This tax structure attracts many expatriates and entrepreneurs.

IS: Competitive corporate tax

Companies benefit from a favourable tax rate:

• General rate: 10%
• Reduced rate: 5% on the first €50,000 of profits
• Tax bonuses available in certain cases

Other taxes and duties in Andorra

Andorra also applies other levies:

• POS (Real Estate Capital Gain)
• IRNR (Non-Resident Tax)
• Tax on savings income
• Gaming Tax

Indirect taxes also exist:

• ITP (Transfer Tax)
• Tax on Insurance Services
• Excise taxes

Municipal taxation in Andorra

Each Andorran parish has its own tax system. Taxes may vary depending on where you live or where you are located. Check with the local authorities to find out about the specificities of your municipality.

Tax benefits for investors

Andorra does not apply double taxation for non-resident investors. This tax policy encourages foreign investment and boosts the country’s economy.

Comparison with other European countries

Andorra stands out for its advantageous tax system:

These figures clearly illustrate the tax attractiveness of Andorra.

Tips for optimising your taxation in Andorra

1. Consult a local tax expert
2. Choose your parish of residence wisely
3. Benefit from the benefits for new businesses
4. Structure your income optimally
5. Stay informed of legislative developments

Conclusion: Andorra, a 100% legal tax exemption

Andorra offers an attractive tax system while remaining in line with international standards. This advantageous tax system attracts entrepreneurs, investors and individuals from all over the world. However, a good understanding of the rules is essential to take full advantage of them.

Are you considering an expatriation or an investment in Andorra? Get professional support by contacting us for a first appointment by phone. Our tax experts will guide you through the administrative and tax procedures for a smooth transition to this European tax haven.

Do not hesitate to do more research on Andorran taxation. The more informed you are, the better you can optimize your tax situation in this country with its many advantages.

In a world where the tax burden can seem overwhelming for many French entrepreneurs and business leaders, the search for legal and effective tax optimization solutions is becoming a major concern. It is in this context that the Principality of Andorra emerges as an attractive destination for those looking to reduce their tax burden while remaining within the framework of the law. Clickand, a gestoria established in Andorra for more than 18 years, is positioned as a key player in supporting French entrepreneurs wishing to explore this path.

Andorra’s tax attractiveness

Andorra, a small state located between France and Spain, offers a particularly advantageous tax framework. Unlike many European countries, the Principality has very low tax rates, making it a legal tax haven for entrepreneurs and investors. This favourable tax regime can be explained by the country’s desire to attract foreign capital and diversify its economy, which has traditionally been based on tourism and trade.

One of Andorra’s main advantages lies in its double taxation treaty with France. This treaty allows Andorran tax residents to avoid being taxed twice on the same income, once in Andorra and once in France. This tax treaty opens the door to legal and effective optimization strategies for French entrepreneurs.

Clickand: A trusted partner for your tax transition

With 18 years of experience, Clickand has established itself as a reference in tax and administrative management for French entrepreneurs wishing to set up in Andorra. The company stands out for its personalized approach and in-depth expertise in the French and Andorran tax systems.

Clickand’s services cover a wide range of needs:

1. Company formation in Andorra: Clickand guides its clients through all the steps of setting up a company in Andorra, ensuring that all legal and administrative requirements are met.
2. Support for obtaining tax residency: The Clickand team assists entrepreneurs in their efforts to obtain tax residency in Andorra, a crucial step to fully benefit from the country’s tax advantages.
3. Legal tax optimisation: Clickand’s experts develop tailor-made strategies to reduce the taxation of dividends and optimize the overall taxation of the company, while remaining within the legal framework.
4. Ongoing monitoring and support: Clickand not only helps with the installation, but offers follow-up over at least 12 months to ensure that the transition goes smoothly and that all tax benefits are fully exploited.

The concrete advantages of tax optimisation in Andorra

To understand the attractiveness of Andorra, it is important to highlight some of the concrete tax advantages that entrepreneurs can enjoy:

1. Reduced corporate tax: While the corporate tax rate in France can be as high as 25%, it is only 10% in Andorra for most activities.
2. Reduced dividend taxation: Dividends are subject to much lighter taxation in Andorra, which allows entrepreneurs to keep a larger portion of their profits.
3. No wealth tax: Unlike France, Andorra does not tax assets, which can represent a substantial saving for entrepreneurs with significant assets.
4. Reduced VAT: With a standard VAT rate of only 4.5%, Andorra offers a clear competitive advantage for many business activities.

The tax optimization process with Clickand

The tax optimization process offered by Clickand generally takes place in several stages:

1. Free initial consultation: Clickand offers an initial telephone consultation to assess the specific situation of each entrepreneur and determine whether a location in Andorra would be beneficial.
2. In-depth analysis: If the project seems viable, Clickand’s experts carry out a detailed analysis of the current tax situation and the potential for optimisation.
3. Developing a strategy: Based on this analysis, a tailor-made tax optimization strategy is developed, taking into account the specificities of the activity and the objectives of the entrepreneur.
4. Implementation: Clickand accompanies the entrepreneur in all the necessary steps, from the creation of the company in Andorra to obtaining tax residency.
5. Follow-up and adjustment: Regular monitoring is provided to adapt to any changes in situation or legislation.

Challenges and considerations

Although tax optimization in Andorra has many advantages, it is important to note that it is not without its challenges. Entrepreneurs must be ready to make a real life change, as obtaining tax residency in Andorra involves spending a significant part of the year there. In addition, it is crucial to scrupulously comply with both French and Andorran tax rules to avoid any risk of recovery.

This is where Clickand’s expertise comes into its own. Their in-depth knowledge of both tax systems allows them to navigate these complex waters safely, ensuring a smooth transition and sustainable tax optimization.

Conclusion: An opportunity to be seized with caution

Tax optimization in Andorra represents an attractive opportunity for French entrepreneurs looking to reduce their tax burden in a legal way. With its 18 years of experience and its personalized approach, Clickand is a partner of choice for those who wish to explore this option.

However, it is crucial to approach this process with caution and professionalism. Successful tax optimization is not just a simple change of address, but involves a global reflection on one’s business strategy and lifestyle. With the right support, such as the one offered by Clickand, this transition can pave the way for a new era of prosperity for French entrepreneurs, allowing them to finally enjoy the fruits of their labor.

To learn more about tax optimization opportunities in Andorra, do not hesitate to contact Clickand for a free and personalized consultation.

When it comes to choosing a favorable jurisdiction for setting up a company, Andorra stands out for its attractive tax framework, especially with regard to the taxation of dividends. For companies looking to maximize their profits and optimize their taxation, understanding the Andorran tax specificities is essential.

Why Choose Andorra to Set Up Your Business?

Andorra has recently modernised its tax framework to attract international entrepreneurs and investors. With a booming economy and one of the lowest corporate tax rates in Europe, the country has become a destination of choice for many companies.

Among the most notable tax advantages, the taxation of dividends is particularly attractive to entrepreneurs. Before we dive into the details, it’s crucial to understand why this jurisdiction is so advantageous.

Taxation of Dividends in Andorra: An Overview

Dividends, which represent a distribution of a company’s profits to its shareholders, are generally subject to tax in most countries. However, Andorra offers an extremely competitive tax regime for dividends, making it a major asset for companies based there.

In Andorra, dividends distributed by a resident company are exempt from income tax for resident shareholders. This means that local entrepreneurs can receive dividends without having to pay additional taxes on this income.

For non-residents, Andorra applies a very competitive withholding tax rate, which can vary depending on the double taxation agreements in place with the shareholder’s country of residence. This offers significant flexibility and tax optimization for international investors.

Conditions for Benefiting from the Exemption

To qualify for the dividend tax exemption in Andorra, certain conditions must be met. First of all, the company must be a resident company, i.e. it must be registered in Andorra and have its registered office there.

In addition, the shareholder must be a tax resident of Andorra to be eligible for the full exemption. It is important to note that tax residency in Andorra involves spending a minimum of 183 days per year in the country and meeting certain income or investment requirements.

For non-resident shareholders, it is crucial to consult the bilateral tax treaties that Andorra has signed with other countries. These treaties often help to avoid double taxation and can reduce or even eliminate withholding tax on dividends.

Concrete Benefits for Entrepreneurs

Setting up your company in Andorra has many tax advantages, but the exemption from dividends is one of the most significant. For entrepreneurs, this translates into a net increase in disposable income after profit distribution. In other words, shareholders can receive higher dividends compared to other jurisdictions where this income would be heavily taxed.

This exemption also strengthens the international competitiveness of Andorran companies. By attracting investors who want to maximize their profits, Andorra creates an ecosystem that is conducive to innovation and economic growth.

Comparison with Other European Jurisdictions

When comparing the taxation of dividends in Andorra with that of other European countries, it is obvious that this jurisdiction offers significantly more advantageous conditions. For example, in countries such as France or Germany, dividends are subject to income tax of up to 30% or more, depending on the tax bracket.

On the other hand, the total exemption from dividends for Andorran tax residents and the reduced withholding tax for non-residents are elements that make Andorra a top tax destination for entrepreneurs.

The Practical Aspects of Setting Up in Andorra

Setting up a business in Andorra is a relatively simple process, but it requires a good understanding of the local requirements. It is recommended to bring in local experts to ensure that all legal and tax obligations are met.

One of the first steps is to choose the legal structure of the company. Andorra offers several types of companies, including the “Sociedad Limitada” (SL) and the “Sociedad Anónima” (SA), which are the most common forms for companies wishing to distribute dividends.

Once the company is set up, it is essential to ensure that the accounting is kept correctly and that all tax returns are submitted on time. This will allow you to take full advantage of the tax advantages offered by Andorra, especially in terms of dividends.

Andorra, a Destination of Choice for investment

The taxation of dividends in Andorra is a major asset for companies and entrepreneurs looking to optimise their taxation. Thanks to a substantial exemption for tax residents and a reduced withholding tax for non-residents, Andorra is positioned as one of the most competitive jurisdictions in Europe.

For companies considering setting up in Andorra, it is essential to have a clear understanding of the conditions and benefits of taxing dividends. By ensuring compliance with local requirements and taking advantage of bilateral tax treaties, entrepreneurs can maximize their profits and ensure the sustainable growth of their business.

Understanding tax optimization: A legal strategy to pay less tax

In a world where the tax burden is constantly increasing, individuals and companies are looking for legal ways to reduce their tax burden. Tax optimisation appears to be an attractive solution, but it is still necessary to understand what it entails and how to implement it without falling into illegality.

What is tax optimization?

Tax optimization is a legal process aimed at reducing the amount of taxes to be paid by using the mechanisms and advantages provided for by law. Unlike tax fraud, it is part of a strict legal framework and requires in-depth knowledge of the tax system. This practice can be applied to various types of taxes, both domestically and internationally.

The challenges of tax optimization

Although legal, tax optimization raises ethical and practical questions. It can be perceived as aggressive when it exploits loopholes in the tax system to drastically minimize taxation. It is crucial to distinguish between legal optimization and tax fraud to avoid any legal risk.

Risks and precautions

Poorly controlled tax optimization can lead to serious consequences: tax adjustments, legal proceedings, or questioning of economic activity. It is therefore essential to call on qualified professionals to develop a tax optimization strategy in accordance with the legislation in force.

Tax optimization strategies for individuals

Individuals have several levers at their disposal to optimise their tax situation:

• Real estate investments: Lois Pinel, Denormandie, or Malraux
• Financial investments: Life insurance, PEA, PERP
• Donations and sponsorship: Tax reductions for donations to associations
• Home employment: Personal services tax credit

Tax optimization for companies

Companies can optimize their taxation in various ways:

• Choice of the appropriate legal structure (SARL, SAS, holding)
• Optimal management of depreciation and provisions
• Use of the research tax credit (CIR) for innovative companies
• Optimization of the executive compensation policy
• International Tax Strategies for Multinationals

International tax optimization

In a globalised context, tax optimisation can take on an international dimension. This particularly concerns:

• Expats looking to optimize their tax status
• Multinational enterprises managing cross-border financial flows
• Real estate investors abroad

It is crucial to comply with international tax rules, including those laid down by the OECD, to avoid any risk of double taxation or tax evasion.

Tax advantages of Andorra

Conclusion: The importance of expert advice

Tax optimization is a complex field that requires specialized expertise. Whether you are an individual or a company, it is recommended that you call on qualified professionals to develop a tailor-made tax optimization strategy. Our experts will help you navigate the maze of taxation while remaining within the legal framework, allowing you to make substantial savings with complete peace of mind.

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An advantageous tax system in Escaldes-Engordany

Before diving into the specific tips, let’s briefly recall the main tax advantages of Andorra, which also apply to Escaldes-Engordany:

1. Very attractive income tax (IRPF):

   • 0% up to €27,000
   • 5% from €27,000 to €43,000
   • 10% over €43,000

2. Competitive corporate tax:

   • Rate between 2% and 10% depending on the case

These rates, which are among the lowest in Europe, make Escaldes-Engordany a destination of choice for optimising its tax situation.

Clickand: your tax partner in Escaldes-Engordany

To take full advantage of these tax advantages, it is recommended to rely on the expertise of local professionals. This is where Clickand stands out as an ally of choice. Here is how this gestoria can support you in your tax optimization process in Escaldes-Engordany:

1. Personalized analysis of your situation

   Clickand’s experts start by studying your personal or professional situation in detail. This step is crucial to identify tax optimization opportunities specific to your case. Whether you are an individual looking to obtain your tax residency or a company wishing to set up, Clickand will be able to adapt its advice to your needs.

2. Tailor-made optimization strategy

   Based on this analysis, Clickand’s tax advisors develop a tailor-made tax optimization strategy. This strategy takes into account the specificities of Escaldes-Engordany and the latest developments in Andorran legislation. The objective is to maximize your tax advantages while remaining within the legal framework.

3. Support in administrative procedures

   One of Clickand’s strengths is its complete support in administrative procedures. Whether it is to obtain your tax residency or the creation of your company in Escaldes-Engordany, Clickand’s experts are there to guide you every step of the way. They ensure that all documents are properly completed and submitted on time, saving you from stress and costly mistakes.

4. Business Management Consulting

   For entrepreneurs, Clickand goes beyond simple tax optimization. Their business management experts can advise you on the most suitable legal structure for your business in Escaldes-Engordany. They will also help you understand the legal and tax obligations specific to your sector of activity in Andorra.

5. Continuous tax monitoring

   The tax world is constantly evolving, even in a stable country like Andorra. Clickand ensures continuous tax monitoring to keep you informed of legislative changes that could impact your situation in Escaldes-Engordany. This proactivity allows you to adjust your tax strategy in real time.

6. Optimizing your expatriation

   If you are thinking of moving to Escaldes-Engordany, Clickand can help you prepare for this transition in an optimal way. Their advisors will guide you through the tax aspects of your move, how to manage your international assets, and how to make the most of your new tax status in Andorra.

7. Multilingual support

   The team at Clickand offers support in multiple languages, making communication easy for international expats relocating to Escaldes-Engordany. This multilingual approach is particularly appreciated in the cosmopolitan context of Andorra.

Practical advice to optimise your taxation in Escaldes-Engordany

In collaboration with Clickand, here are some practical tips to optimize your tax situation in Escaldes-Engordany:

1. Plan your tax residency: Make sure you meet the requirements for tax residency in Andorra to take full advantage of the advantageous tax regime.
2. Structure your business wisely: Choose the legal form that best suits your business to optimize your taxation.
3. Exploit local tax loopholes: Andorra offers specific tax incentives, especially for innovative or environmentally friendly companies.
4. Strategically manage your revenue: With the help of Clickand, structure your income in a way that optimizes your position vis-à-vis tax brackets.
5. Invest locally: Some investments in Andorra may offer additional tax benefits.
6. Stay compliant: Transparency and compliance are key. Clickand helps you stay in good standing with the Andorran tax authorities.
7. Plan for the long term: Your tax strategy should be part of a long-term vision of your presence in Escaldes-Engordany.

Conclusion

Optimising your tax situation in Escaldes-Engordany is an exceptional opportunity, but one that requires in-depth expertise and professional support. With Clickand as your partner, you get comprehensive support, from the initial analysis to the implementation of your tax strategy.

Feel free to contact Clickand to explore how you can make the most of Escaldes-Engordany’s advantageous tax system. Their personalized approach and in-depth knowledge of the local context make Clickand a valuable ally in your quest for tax optimization in Andorra.

By choosing Clickand, you are not only sure to maximize your tax benefits, but also to do so legally and with peace of mind. Whether you are an individual or a company, Escaldes-Engordany and Clickand offer you the keys to an optimised tax future in Andorra.

Expatriation is an exciting adventure, but it requires careful planning, especially when it comes to budgeting. For those considering moving to Andorra, understanding the associated costs is crucial. Let’s discover together the different financial aspects to take into account for a successful expatriation in this small Pyrenean paradise.

Why does Andorra attract so many expats?

Nestled between France and Spain, the Principality of Andorra has become a destination of choice for many expats. Its appeal lies in several key factors:

• Advantageous taxation
• An exceptional living environment
• A healthy and peaceful environment
• Geographical proximity to two major European countries

These advantages make Andorra an attractive option for those looking to optimize their quality of life while benefiting from a favorable tax regime.

The cost of living in Andorra: A pleasant surprise

Compared to other European countries, the cost of living in Andorra is relatively low. This accessibility is mainly due to an advantageous tax system that has an impact on many aspects of daily life.

Reduced VAT: A significant impact on purchasing power

VAT in Andorra is almost non-existent on many essential products and services:

• Feeding
• Transport
• Health Care
• Leisure

The maximum VAT rate does not exceed 4.5%, compared to 20% in France. This noticeable difference translates into more affordable prices for consumers.

Average monthly budget: Living comfortably at a lower cost

To live comfortably in Andorra, you need to plan a minimum monthly budget of 1,000 to 1,500 euros. This amount covers essential expenses, including about 250 euros for food and hygiene.

It is important to note that these numbers are averages and actual spending can vary greatly depending on individual lifestyle.

Accommodation in Andorra

Housing often represents the largest part of an expatriate’s budget. In Andorra, the real estate market offers various options, whether for renting or buying.

Renting: A Popular Option

About 60% of households in Andorra are renters. Rental prices vary according to several criteria:

• Type of accommodation
• Size and number of rooms
• Comfort
• Location

For a studio in the city center, expect a rent of between 700 and 1,000 euros, including charges.

Buying a property: A long-term investment

For those considering an extended stay, buying can be an attractive option. The average prices are as follows:

• Apartment: approx. €/m² 4,156
• House: approx. €/m² 4,121

These prices can vary considerably depending on the standing and location of the property.

Andorran taxation: A major asset for expatriates

One of the main attractions of Andorra is undoubtedly its advantageous tax system. Here are the key points to remember:

Income tax: A competitive rate

Personal income tax does not exceed 10%. This rate is significantly lower than in many European countries.

Corporate tax: Favourable to entrepreneurs

Companies also benefit from a tax rate capped at 10%, making Andorra an attractive destination for entrepreneurs and investors.

IGI: The equivalent of VAT

The IGI (General Indirect Tax) is the Andorran equivalent of VAT. Its maximum rate is 4.5%, much lower than that of most European countries.

Social security contributions: An advantageous system

Social security contributions in Andorra are relatively low, which helps to reduce the overall cost of living for residents.

Administrative procedures: Prepare your installation

Although entry into Andorra is easier for European Union nationals, certain steps are necessary to settle there permanently.

Visa: A formality for Europeans

EU citizens do not need a visa to travel to Andorra. However, to reside there, you must take specific steps.

Andorran residence: A must-see stop

Before they can settle permanently, expats must obtain an Andorran residency. This is essential and requires careful preparation.

Health and education: Quality services at a lower cost

Health system: Effective coverage

Andorra has an efficient healthcare system. Residents benefit from medical coverage at advantageous rates, helping to reduce healthcare expenses.

Education: Varied options

The Andorran education system offers several options, including free public schools and international institutions. The costs of private education are generally lower than those in major European cities.

Transport and mobility: Getting around Andorra

Public transport: Economical and efficient

The public transport network in Andorra is well-developed and affordable. It is an economical option for daily travel.

Personal car: Accessible luxury

Owning a car in Andorra can be more affordable than elsewhere in Europe, especially thanks to the reduced taxes on vehicles.

Leisure and culture: Enjoy Andorran life in summer and winter

Andorra is famous for its ski resorts. Residents often receive preferential rates for ski passes.

Cultural activities: A varied and accessible offer

Despite its small size, Andorra offers a rich cultural life with museums, festivals and events throughout the year, often at reasonable prices.

Tips for optimising your expatriation budget

1. Plan ahead: Set a detailed budget before you leave.
2. Learn about the tax benefits: Consult an expert to optimize your tax situation.
3. Explore different housing options: Compare neighbourhoods and housing types.
4. Adopt local habits: Shop at local markets for fresh produce at a lower cost.
5. Take advantage of free activities: Andorra offers many opportunities for outdoor recreation.

Andorra, a wise choice for savvy expats

Expatriating to Andorra can be a financially advantageous decision. With a moderate cost of living, attractive taxation and an exceptional living environment, the Principality offers a unique balance between quality of life and financial optimisation.

However, as with any expatriation, careful preparation is essential. By taking into account all the aspects discussed in this article, you will be able to plan your move to Andorra in an informed and serene way.

Remember, every situation is unique. Do not hesitate to contact us for personalized advice tailored to your specific situation.

Andorra awaits you with its majestic mountains, clean air and opportunities. Are you ready to take the step towards a new life in this jewel of the Pyrenees?

Andorra is often perceived as an attractive destination for investors due to its advantageous taxation and stable economic environment. Clickand offers you an in-depth exploration of financial investment rates in Andorra. We will analyze the performance of the different financial instruments available, such as savings accounts, government bonds, stocks, investment funds, real estate, and life insurance. We will also detail the tax obligations associated with these investments and the tax framework in effect. In addition, real-world examples of investment performance will be provided, and we will discuss investment options with high potential returns, including investments in startups, hedge funds, and cryptocurrencies. Finally, we will conclude with a summary of the investment opportunities in Andorra and the advantages they offer to investors looking to maximize their returns while benefiting from low taxation.

Geolocate us

1. The economic context of Andorra

Andorra enjoys an open and diversified economy, although traditionally focused on tourism, retail, and financial services. In recent years, the country has undertaken reforms to attract more foreign investment, making its financial market more accessible and attractive.

2. Financial instruments available in Andorra

Investors in Andorra can choose from a range of financial instruments, each offering varying rates of return.

has. Savings accounts

Savings accounts in Andorra offer competitive interest rates compared to those in neighboring countries. Rates can vary, but they are usually between 0.5% and 1.5% per year, depending on the bank and the specific conditions of each account.

b. Government bonds

Andorran government bonds are considered safe investments with moderate returns. The rates of return for these bonds are around 2% to 3% per year. These bonds are particularly popular with investors looking to minimize risk while earning stable returns.

c. Shares and Investment Funds

The stock market in Andorra is less developed than in major economies, but there are investment opportunities through funds managed by local financial institutions. Returns on stocks can vary significantly depending on the performance of specific companies and overall market conditions. Investment funds, on the other hand, offer risk diversification with potential returns ranging from 4% to 7% per year.

d. Real Estate

Real estate investment is also popular in Andorra. The Andorran real estate market has shown stable growth, with annual rental yields of around 3% to 5%, depending on the location and type of property.

e. Life insurance

Life insurance policies in Andorra are attractive because of their flexibility and tax advantages. The rates of return on life insurance vary depending on the options chosen, but they can reach 3% to 5% per year for secure contracts and up to 7% to 10% for more dynamic and diversified contracts.

3. Taxation of Investments in Andorra

One of the main attractions for investors in Andorra is its favorable tax regime.

has. Personal Income Tax

Investment income in Andorra is subject to personal income tax (IRPF). However, the tax rates are relatively low, with a maximum rate of 10%. In addition, the first €24,000 of income is tax-free for tax residents.

b. Corporate Tax

Andorran companies also benefit from advantageous taxation with a corporate tax rate of 10%, which can be reduced to 2% under certain conditions, particularly for companies carrying out innovation or research activities.

c. Value Added Tax (VAT)

VAT in Andorra, called IGI (Impost General Indirect), is one of the lowest in Europe, set at 4.5%. This makes business transactions and purchases of goods and services more attractive to residents and investors.

d. Tax Exemptions and Reductions

There are various tax exemptions and reductions for investors in Andorra. For example, income generated by Andorran government bonds is generally tax-free. In addition, capital gains on the sale of real estate can be tax-exempt if the funds are reinvested in the purchase of another property in Andorra.

4. Examples of Investment Performance in Andorra

To illustrate the performance of investments in Andorra, let’s look at some practical examples.

a. Example of Investing in Government Bonds

Suppose an investor buys Andorran government bonds worth €600,000 with an annual yield of 2.5%. After five years, the investor would have earned €75,000 in accumulated interest, while benefiting from favourable taxation since this interest could be partially or totally exempt.

b. Example of Real Estate Investment

An investor buys a property in Andorra la Vella for €1,000,000. By renting out this property, he generates an annual rental income of €40,000, or a rental yield of 4%. After ten years, the value of the property could increase due to the stable real estate demand, offering not only rental income but also potential capital gain. For example, if the value of the property increases by 20% over ten years, the investor could make a capital gain of €200,000, in addition to the €400,000 generated by rents over this period.

c. Example of Life Insurance Investment

Let’s assume that an investor takes out a life insurance policy worth €300,000 with an average annual return of 5%. After ten years, the investor could obtain a capital of approximately €488,668, taking into account compound interest and tax benefits related to life insurance in Andorra.

5. High Yield Investments

For investors willing to take on more risk, there are several options that can offer potentially higher returns:

has. Investments in Startups and Innovative Companies

Investing in startups or innovative companies can offer substantial returns. In Andorra, there are several initiatives aimed at encouraging entrepreneurship and innovation. In addition to the potential returns of 15% to 25% per year or more if successful, these investments also benefit from significant tax advantages.

For example, investments in startups can benefit from income tax reductions and capital gains exemptions, which increases the attractiveness of this type of investment. Our tax expertise and consulting company Clickand located at Av. del Pont de la Tosca, 11, AD700 Escaldes-Engordany, offers modern rental spaces with state-of-the-art infrastructure for startups and innovative companies, facilitating their development and success.

b. Hedge Funds

Hedge funds, such as hedge funds, can offer high returns in exchange for taking significant risk. Returns can vary widely, ranging from 10% to 30% per year, depending on the strategies employed and market conditions.

c. Cryptocurrencies

Investing in cryptocurrencies is highly speculative but can offer extremely high returns. For example, some cryptocurrencies have seen their value increase by more than 100% in one year. However, the risks of volatility and total loss of capital are also very high.

Investing in Andorra

Investing in Andorra offers interesting opportunities thanks to a diversified range of financial instruments and an advantageous tax regime. Whether it’s through savings accounts, government bonds, stocks, real estate, or life insurance, investors can find options that suit their financial needs and goals. For those looking for potentially higher returns, higher-risk options like startups, hedge funds, and cryptocurrencies may be considered. Andorra’s economic stability and favourable fiscal policies continue to make the country an attractive destination for financial investments.

Conclusion

For investors looking for high-performance investment solutions in Andorra, we offer a diverse range of options to suit different investor profiles. With personalized services and local expertise, Clickand helps investors maximize their returns while benefiting from Andorra’s tax advantages. Whether you are interested in secure investments or want to explore high-risk opportunities with high potential returns, Clickand offers solutions tailored to your financial needs and goals.

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In Andorra, gift tax, or tax on free wealth transfers (ITPG), is an important topic for foreign residents and investors. Our Gestoria offers you a detailed understanding of the circumstances, the different cases, and the corresponding articles of law. We will also answer concrete questions to help you navigate this taxation.

What is a Donation?

A gift is an act by which one person (the donor) transfers ownership of an asset to another person (the donee) without financial consideration. In Andorra, gifts can include real estate, sums of money, shares, and other types of property.

Taxation of Gifts in Andorra

The ITPG applies when property is transferred from one person to another without consideration. The rules and tax rates vary according to several criteria, including the relationship between the donor and the donee.

Tax Rates by Relationship

• Between parents in the direct line (parents-children): The rate is 0%.
• Between 2nd degree collateral relatives (brothers/sisters): The rate is 10%.
• Between unrelated persons: The rate is 25%.

Value of Donated Property

The value of donated property is a key factor in the tax calculation:

• Buildings: The value taken into account is the higher of the purchase price and the cadastral value.
• Movable property (money, shares, works of art): The market value on the day of the gift is used.

Deductions

Andorran tax residents benefit from allowances on the total value of donated assets:

• Spouse, ascendant or direct descendant: Allowance of €40,000.
• Other cases: Allowance of €20,000.

Corresponding Sections of the Act

The articles of Andorran law relating to gifts are mainly found in the “Codi de Família” (Family Code) and the “Codi de Successions i Donacions” (Inheritance and Donation Code). Here are some key articles:

• Article 13 of the Family Code: Conditions for gifts between parents and children.
• Article 27 of the Inheritance and Gifts Code: Types of property that can be donated and terms of donation.
• Article 42 of the Inheritance and Gifts Code: Gifts between spouses, exempt from tax under certain conditions.

Formalities to Follow

For the gift to be valid, several formalities must be respected:

• Notarial deed: The donation must be formalized by a notarial deed. The notary registers the gift and ensures that all legal requirements are met.
• Official registration: The donation must be registered with the relevant authorities.
• Required documentation: Proof of ownership, identification of parties involved, etc.

Concrete questions

1. Is it possible to make a gift to a person who is not a resident of Andorra?

Yes, it is possible to make a gift to a non-resident person. However, it is recommended that you consult with a tax advisor to understand the tax implications in the donee’s country of residence.

2. Are donations in Andorra subject to notary fees?

Yes, donations are subject to notary fees, which vary depending on the value of the donated property and the complexity of the notarial deed.

3. What are the tax implications for a gift of real estate in Andorra?

Gifts of real estate between direct relatives and between spouses are exempt from tax. However, notary fees and registration fees may apply. It is crucial to ensure that all legal formalities are followed to avoid future complications.

In conclusion

Gift tax in Andorra offers significant advantages, including the exemption for gifts between direct relatives and spouses. However, it is essential to comply with the legal formalities and consult with tax and legal experts to ensure that everything is in order. With a clear understanding of the articles of the law and the different circumstances of donation, you can plan your donations efficiently and in full compliance with Andorran legislation.

For those looking for professional support in this area, Clickand, our gestoria based in Andorra, specialises in this type of case. Our team of experts can help you navigate the complexities of gifting and optimize your tax situation. To make an appointment and get personal advice, you can book an appointment by email.

By following these recommendations and being accompanied by professionals like Clickand, you can manage your donations with complete peace of mind and in compliance with the legislation in force.

The tourism sector in Andorra represents a unique and promising investment opportunity. With its picturesque landscape, varied activities and thriving economy, Andorra is attracting more and more investors. In this post, we’ll explore why investing in tourism in Andorra makes sense, key sectors to consider, and how to maximize your return on investment.

Why Invest in Tourism in Andorra?

1. A constant flow of tourists:
   • Proximity to Major Cities: Andorra benefits from its proximity to France and Spain, attracting tourists from both countries throughout the year.
   • Natural Attractions: The Andorran mountains offer outdoor activities in all seasons, from skiing in winter to hiking in summer.
2. Tax advantages:
   • Low Taxes: Andorra offers an attractive tax regime for companies, with low tax rates, thus encouraging foreign investment.
   • Administrative Facilities: The Andorran government simplifies the procedures for foreign investors, making the business environment favorable.
3. Economic growth:
   • Stable Economy: Andorra has a stable and growing economy, supported by the tourism sector, offering safe investment opportunities.

Tourist numbers in Andorra in 2023

Background and Trends

• Post-pandemic: The post-pandemic recovery has seen an increase in international tourism, with strong demand for outdoor destinations like Andorra.
• Seasonal Activities: Andorra remains a popular destination for skiing in the winter and hiking in the summer, attracting visitors from all over Europe.

Estimates

• Number of tourists in 2023: Based on the trends of previous years and the projected growth, it can be estimated that Andorra welcomed around 9 million tourists in 2023.

Key Sectors for Tourism Investment in Andorra

1. Hotels and Accommodation:
   • Luxury Hotels: Investing in high-end hotels meets a growing demand for luxury tourism.
   • Eco-friendly accommodations: With the rise of ecotourism, eco-friendly lodges and hotels are becoming more and more popular.
2. Leisure Services:
   • Ski resorts: Andorra is renowned for its world-class ski resorts, such as Grandvalira and Vallnord.
   • Thermal baths and spas: Wellness centres attract a clientele looking for relaxation, especially in a mountainous setting.
3. Catering and Gastronomy:
   • Gourmet Restaurants: Opening restaurants that offer unique dining experiences can attract a high-end clientele.
   • Bars and Cafés: These establishments benefit from a high number of visitors, especially in tourist areas and ski resorts.
4. Outdoor Activities:
   • Hiking and Cycling: Offering guided services and equipment rentals for hiking and cycling can be very profitable.
   • Extreme Sports: Develop activities such as paragliding, climbing or canyoning to attract thrill seekers.

Tips for Maximizing Your Return on Investment

1. In-depth Market Research:
   • Analyze current and future tourism trends.
   • Identify the needs and expectations of different categories of tourists.
2. Local Partnerships:
   • Collaborate with local travel agencies and businesses to attract more tourists.
   • Offer packages that combine accommodation, catering and activities.
   • Invest in existing local businesses
3. Customer Experience:
   • Provide exceptional customer service to ensure positive reviews and build customer loyalty.
   • Use customer feedback to continuously improve your services.

Case Studies and Success Stories

1. The Rise of Grandvalira:
   • Grandvalira, one of the largest ski resorts in the Pyrenees, has attracted significant investment in recent years, improving its infrastructure and services, which has led to a significant increase in the number of visitors.
2. The Impact of Luxury Hotels:
   • Hotels such as the Sport Hotel Hermitage & Spa have focused on luxury and wellness, attracting an international clientele looking for unique and high-quality experiences.

Conclusion

Investing in the tourism sector in Andorra offers interesting prospects thanks to its exceptional natural setting, tax advantages and stable economic growth. Whether you are interested in hospitality, leisure services, catering or outdoor activities, Andorra presents fertile ground for profitable and sustainable investments. By following the tips and strategies mentioned, you can maximize your return on investment and contribute to the tourism boom of this beautiful region of the Pyrenees.

Grandvalira and Vallnord, the two main winter sports resorts in Andorra, are attracting more and more real estate investors in search of profitability and attractive capital gains. Located in the heart of the majestic Pyrenees, they combine guaranteed snow, state-of-the-art infrastructure and a breathtaking natural setting. Whether you are looking for a primary residence, a second home or a rental property, these two destinations are ideal for making your dream of a mountain residence a reality.

Grandvalira, the giant of the Pyrenees

With its 210 km of slopes spread over 6 sectors, Grandvalira is the largest ski resort in the Pyrenees and one of the largest in Spain. Every year, it attracts hundreds of thousands of skiers and snowboarders from all over the world, seduced by the quality of its ski area and the diversity of its slopes.

Its strategic location, halfway between major Spanish cities such as Barcelona and the French border, makes Grandvalira a privileged choice for the acquisition of a second home or a high mountain apartment. There is no shortage of assets for investors: easy accessibility, modern infrastructure, permanent entertainment and a wealthy cosmopolitan clientele.

Real estate is known for its excellent value for money compared to the major Alpine resorts. There is a wide choice of new developments and old properties to renovate, from studios to luxury chalets, for all budgets. Many foreign investors have already taken the plunge, seduced by the rental potential and the prospects of interesting capital gains.

And Grandvalira is not just a winter resort! When the snow melts, the slopes turn into green hiking trails. The typical villages such as Grau Roig, Soldeu or El Tarter retain all their charm to welcome nature lovers. A real asset to make your property profitable all year round!

Vallnord, the hidden pearl of the Pyrenees

Just 15 minutes from Andorra la Vella, the capital of the Principality, Vallnord is a little gem in the mountain landscape. Divided into two main sectors, Pal and Arinsal, it offers a total of 93 km of renowned alpine ski slopes. A human-sized estate ideal for a stay with family or friends.

Vallnord is committed to a more family and friendly spirit than Grandvalira. Every winter, mountain lovers will find the ideal setting for a nature holiday in the great outdoors, far from the hustle and bustle of the big resorts. The generous sunshine, the breathtaking views of the snow-capped peaks and the proximity to the lively life of Andorra la Vella give Vallnord a unique charm.

In this mountain haven of peace, investing in real estate represents a real opportunity for savvy investors. From traditional chalets to new tourist residences, prices defy all competition compared to the major resorts of the French or Swiss Alps. A major advantage for building up a quality real estate portfolio at a lower cost.

The potential for rental profitability is also well established. Whether it’s for a few weeks in winter or a summer stay, the demand is there for this little corner of Pyrenean paradise. This is a great way to prepare for retirement or to build up a welcome additional income.

Investing in Grandvalira and Vallnord: Andorra’s advantageous taxation, an additional asset

In addition to an exceptional natural setting, Andorra offers a very attractive tax system for investors. In this small sovereign state, income tax is almost non-existent (maximum 10%) and there is no wealth tax. An ideal preferential regime for foreigners wishing to acquire a property or settle permanently.

Another significant advantage is that the formalities for non-residents are simplified. Buying real estate is made easier and administrative procedures are reduced to a strict minimum. A real plus when you know the complexity of these procedures in other countries.

So, are you ready to invest in your dream residence in Grandvalira or Vallnord? Don’t hesitate any longer and call on our business centre specialising in real estate investment in Andorra. We will be able to guide you and help you discover the real estate wonders of these two choice destinations in the heart of the Andorran Pyrenees. A winning investment on all levels!

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At Clickand, a tax advisor firm established in Andorra since 2007, we have developed unrivalled tax expertise to meet the needs of companies and individuals wishing to benefit from the advantageous environment of the Principality. In this article, we will show you why our services stand out as the benchmark for optimal and perfectly legal management of your tax situation.

Corporate taxation controlled from A to Z

Andorra has many advantages for economic activity, starting with a highly competitive tax system. At Clickand, we use our in-depth knowledge of local legislation to help companies comply with regulations on:

– Corporate tax and direct
taxation – VAT, customs duties and indirect taxes
– Reporting and accounting obligations

Our role is not limited to simple advice. We position ourselves as true partners dedicated to the research and implementation of legal and sustainable tax optimization strategies for our clients. Thanks to a continuous regulatory watch, we anticipate changes to constantly adjust the management of their tax file.

Tailor-made follow-up for individuals and their assets

While entrepreneurs appreciate Andorra for its business-friendly environment, the Principality is also a tax haven popular with many wealthy taxpayers, whether they are residents or not. For these individuals, rigorous monitoring of tax obligations is essential to the preservation of their wealth.

This is why we take care of all aspects related to:

– Income tax and property
holding – Real estate tax exemption
– Transmission of assets (inheritance, donations)
– Tax status of resident or non-resident

With decades of experience, our experts have mastered the intricacies of the Andorran tax system and its international conventions. We therefore develop tailor-made strategies, in the most perfect legality, to enable our individual clients to optimise their situation in a sustainable and secure way.

International taxation: global and multi-country solutions

Andorra’s strategic geographical location, combined with an advantageous tax framework, makes it an ideal platform for international business and wealth activities. Whether it is a question of cross-border transactions, the mobility of management teams or real estate investments abroad, these contexts require the support of international tax experts.

This is one of our specialties at Clickand. Our experience allows us to offer tailor-made multi-jurisdictional services through close coordination with our tax lawyers based in Andorra as well as in more than 130 countries.

From the management of international mobility to the tax optimisation of expatriate remuneration and the repatriation of income, we design global legal and tax solutions to simplify obligations and enhance the value of our clients’ assets.

At Clickand, our 360° vision allows us to understand taxation in its entirety. Whether it is personal or entrepreneurial, local or international, our experienced multidisciplinary teams are committed to providing tailor-made answers, in compliance with the law and ethics.

Need to fin Tax advisor in Andorra? Trust the experts at Clickand for optimal support.

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Andorra is attracting more and more entrepreneurs due to its advantageous taxation, peaceful living environment and status as a fast-growing economic hub. If you are thinking of setting up your business in Andorra, here is a detailed guide to help you with the essential administrative procedures and key aspects to consider when setting up a business activity in Andorra.

1. Key steps for setting up your business in Andorra

1.1 Choosing the right legal form

Andorra offers various legal structures for your company, each with its own tax and management benefits. Common options include the Limited Company (SL) for small and medium-sized businesses, the Public Limited Company (SA) for larger companies, and the collective company.

Read our article on Types of Companies in Andorra

1.2 Obtaining Foreign Investment Authorization

If non-Andorran residents hold more than 10% of the capital of your company, you must obtain a foreign investment permit. This process requires a detailed business plan and a minimal capital contribution.

Our services in detail

1.3 Opening a bank account

Opening a bank account in Andorra is necessary to deposit the share capital and carry out the financial operations of your company. Several local and international banks offer services adapted to companies.

1.4 Drafting the articles of association and appointing the officers

The articles of association define the operation of your company, the distribution of capital and the powers of the managers. They should be drafted with the help of a legal expert to ensure compliance with the laws.

1.5 Obtain the Tax Registry Number (TRN)

The NRT is a unique tax identifier for your business, needed to issue invoices and pay taxes.

1.6 Registering for social security

As an employer, register your employees with the Andorran social security system and contribute to pension and health insurance schemes.

2. Set up a business activity in Andorra: Additional aspects to consider

2.1 Domiciliation and commercial premises

Any company must have a physical address in Andorra, which can be a commercial space or rent a shared office in a business center in Andorra, which offers shared services and departments.

2.2 Accounting and Tax Obligations

Rigorous accounting is mandatory in Andorra. Comply with corporate taxes, VAT (IGI in Andorra) and other local taxes.

3. Aid and support for business creation

The Andorran government and various organizations offer programs to help with business creation. Take advantage of these resources to get valuable advice and support.

Conclusion

Creating a business activity in Andorra offers promising opportunities. By carefully following these steps and being accompanied by professionals, you increase your chances of success in setting up your business in Andorra. Always consult legal and tax experts for personalized advice and assistance tailored to your specific needs.

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The recent tax law regarding foreign real estate investments in Andorra introduces significant changes for those who are considering acquiring real estate in this attractive country. Announced last September, this measure ends a temporary moratorium and marks a turning point in conditions for foreign investors looking to exploit Andorra’s real estate potential. Let’s find out what these changes mean for investment strategies and what you can do to adapt.

Tax on Foreign Real Estate Investments in Andorra

The new law on this tax was approved at the beginning of February 2024. This is a progressive indirect tax, applied to the real value of the acquisition, and is broken down into four brackets:

• 3% on the purchase of the first property.
• 5% off the second and subsequent purchases.
• 8% when at least six properties are purchased.
• 10% on the tenth and subsequent properties, or for urban or real estate developments.

Who has to pay this tax?

According to the new law, any foreign national, natural or legal, who obtains permission to invest in real estate in Andorra is required to pay this tax.

Application and calculation

The amount of the tax is determined at the time of signing at the notary’s office. For new construction projects, it is calculated at the time of registration of the new construction. Once foreign investment status has been obtained, registration in the Register of Foreign Investments becomes mandatory, as well as the generation and payment of the corresponding tax. Note that in the event of loss of foreign investment status, the tax already generated and paid will not be refunded.

Tax reductions

The law provides for a 90% reduction in the tax payable if the property is used for permanent rental for at least 10 years. Any changes before the end of this period will result in the full payment of the tax, with limits imposed to prevent abuse.

Stimulating the rental housing market

Law 3/2024, which governs this tax, aims to promote the Andorran rental housing market. In September 2023, a temporary suspension of foreign investment in real estate was decreed to ensure sustainable development and control speculative purchases. The revenue from this tax will help facilitate access to affordable rental housing.

Invest and live in Andorra in 2024

Despite this tax, Andorra remains attractive for its competitive tax system, exceptional natural setting, low crime rate, and top-notch healthcare system. These advantages make it an ideal place to minimize the tax burden while benefiting from a stable economic environment.

A diversified range of investment options:

Andorra offers foreign investors a wide range of investment opportunities, allowing them to diversify their portfolios and achieve their financial goals. Some of the most popular options include:

• Investment in local companies: Andorra is home to a growing number of dynamic and innovative companies in various sectors, such as fintech, tourism, green energy, and biotechnology. Investing in these companies allows foreign investors to contribute to the country’s economic growth while benefiting from attractive potential returns.

• Real estate acquisition with rental advantages: The Andorran real estate market is booming, offering foreign investors opportunities to acquire quality real estate in an attractive environment. Renting out these properties can generate stable and attractive passive rental income, especially since rental demand is strong in the country.

• Portfolio investments: Andorra offers access to global financial markets, allowing foreign investors to diversify their portfolios with stocks, bonds, and other financial instruments. The country has a strong and regulated financial system, ensuring the safety of investments.

• Other forms of investment: Other forms of investment, such as investment funds, collective real estate investments, and investments in start-ups, are also available in Andorra, providing foreign investors with additional opportunities to diversify their portfolios and achieve their financial goals.

A business-friendly environment:

Andorra is committed to creating a business-friendly environment for foreign investors. The country has implemented advantageous tax reforms, including a 0% corporate tax on certain activities, and has simplified administrative procedures to facilitate the establishment of foreign companies.

What are the quotas for residence permits in Andorra for 2024?

What is changing?

• A new global quota has been introduced for residence and self-employment permits. This quota amounts to 100 authorisations for the year 2024.
• The specific quotas for the various self-employed professional activities have been abolished.
• Applications for residence permits and self-employment will now be processed in the order in which they are submitted.

Who is concerned?

• This new quota concerns third-country nationals who wish to settle in Andorra and carry out a self-employed professional activity.
• Nationals of the European Union, the European Economic Area and the Swiss Confederation are not affected by this quota.

How do I apply?

• Applications for residence and self-employment permits can be submitted to the Immigration Department of the Government of Andorra.
• Applications must be accompanied by a number of documents, including a valid passport, a clean criminal record certificate, and a business plan.

Foreign investment in Andorra in 2024: key points to remember

A significant contribution to the economy: Foreign investment has played a crucial role in the Andorran economy, accounting for 18.7% of GDP in 2021. This underlines the country’s attractiveness as an investment destination and its significant contribution to economic growth.

Continued growth in 2022/2023: The positive trend continued in 2022/2023, with a continuous increase in the volume of foreign investment. This trend highlights the growing confidence of investors in Andorra’s economic potential.

The preferred service sector: The services sector attracted the majority of foreign investment in 2023. This reflects the increasing diversification of the Andorran economy and its move away from its traditional dependence on tourism.

The origin of the investments: The main foreign investors in Andorra in 2022 and 2023 were Spain and France, neighboring countries. This is due to the close economic and cultural ties that Andorra has with these two countries.

Future prospects: The outlook for foreign investment in Andorra remains positive. The country’s stable political and economic framework, coupled with its commitment to innovation and sustainability, is expected to continue to attract foreign investors in the coming years.

Moving to or investing in Andorra has many advantages, both in terms of taxation and quality of life. With a variety of opportunities available, Andorra is an attractive choice for investors and potential residents. Feel free to contact us for more information about these new regulations and investment opportunities.

Welcome to the official blog of Clickand, your accounting and legal consulting firm based in Andorra. We are proud to offer a full range of specialized accounting, financial management and legal advisory services to a diverse clientele, ranging from businesses to individuals, seeking to optimize their taxation and legal obligations.

International Public Accounting Services

Our firm stands out for its commitment to providing tailor-made solutions to meet the specific needs of our clients. Whether you are a company looking to optimize your taxation or an individual considering a residence in Andorra, our services are designed to support you at every stage of your financial journey.

For Companies: Tax Optimization and Accounting Management

At the heart of our offering for companies is our in-depth accounting expertise. We offer services ranging from the preparation of annual accounts to advice on management, business law, international taxation, and real estate investments. Our team of experts is here to help you navigate accounting and tax challenges, offering you personalized support to optimize your legal and tax obligations.

We also simplify your tax processes by carefully analyzing the size of your company and its current performance. In addition, we offer you comprehensive support for the establishment and administrative management of your business, including financial and legal auditing, management of government records and opening of bank accounts.

For Individuals: Tax Advice and Andorran Residency

For our private customers, we understand the importance of tailor-made solutions. Whether you are looking to establish a residency in Andorra or optimize your tax situation, our team is here to guide you. We offer complete assistance for the administrative constitution of Andorran residency, the management of government documents, and even the obtaining of Andorran nationality.

Legal Support and Advice Services to obtain Residency in Andorra:

1. Tax Tips:
   • In-depth analysis of the personal tax situation.
   • Tax optimization for Andorran residents, including retirees.
   • Tax structuring to maximize the tax benefits offered by the Andorran regime.
2. Constitution of the Andorran Residence:
   • Assistance in the process of applying for residency in Andorra.
   • Management of the necessary documents and administrative formalities.
3. Obtaining Andorran Nationality:
   • Advice and support for people wishing to obtain Andorran nationality.
   • Management of the procedures and documents required for naturalization.
4. Family reunification:
   • Organization and assistance for family reunification in Andorra.
   • Preparation of necessary documents for family members.
5. Tailor-made services:
   • Analytical study of personal projects and objectives in Andorra.
   • Adaptation of services according to the specific needs of the client.

Objective of the Support Services:

The main objective of these services is to make the process of establishing in Andorra as easy as possible for individuals, offering personalized support every step of the way. These specialized advisors aim to ensure that clients achieve their personal and tax goals while moving to or retiring in Andorra.

Partnership with Andorran Banks

As an accounting and financial firm, we have privileged relationships with Andorran banks. This allows us to offer our clients investment solutions tailored to their needs and risk profiles, strengthening our ability to provide international wealth management and investment services.

Our Commitment to Your Financial Success

At Clickand, we are a dynamic and innovative team, focused on technology and customer experience. Whether you need investment management, financial planning or tax advice, our firm has the resources and expertise to help you achieve your financial goals.

Don’t delay in contacting us to take the next step in your financial success. Our dedicated team is ready to support you on your journey towards optimal financial management in Andorra and beyond.

Contact us today!

Feel free to contact us now to find out how Clickand can help you achieve your financial and legal goals. We look forward to working with you and offering solutions tailored to your specific needs.

Clickand – Your Trusted Partner in Accounting and Legal Advice in Andorra

Andorra and Dubai are two popular destinations for expats attracted by their low tax system. But which jurisdiction offers the most attractive tax system? To help you make your choice, this article compares Andorra’s and Dubai’s tax regimes in detail, while also looking at immigration rules, passport retention, security, and financial management from an international perspective.

Personal income tax

Andorra levies a personal income tax (IRPF) with progressive rates ranging from 0% to 10%. The first €24,000 of income is tax-free.

Dubai does not levy any personal income tax for residents.

Corporate income tax

Corporate income tax in Andorra is a maximum of 10%.

The corporate tax rate in Dubai is 0% for most business activities.

But to benefit from the tax benefits of the Emirates, you will need to be considered a tax resident there.

This tax residency is obtained when:

• You reside in the territory of the United Arab Emirates for at least 185 days a year.
• You have owned a home in the Emirates for more than 6 months.
• You have an active bank account in the Emirates for more than 6 months.
• You have a residency visa.

Since1989 there has been a bilateral agreement between the United Arab Emirates and France that fixes the tax residence of the expatriate and settles any conflict of residence thus avoiding potential double taxation (the fact of paying taxes in 2 countries at the same time).

The criteria required by the tax treaty and by Article 4B of the French Tax Code to no longer be recognized as a French tax resident are as follows:

• Not have your home and/or main place of residence in France.
• Not to carry out a professional activity in France, unless this activity is carried out on an ancillary basis.
• Not having the center of its economic interests in France (in particular not having as its main sources of income, income of French origin).

However, even if you obtain tax residency in Dubai, all of your income from French sources remains taxable in France.

Value Added Tax (VAT)

VAT in Andorra is 4.5%, with a reduced rate of 0% for certain basic necessities.

VAT in Dubai is 5%.

Other taxes

In Andorra, there are no wealth taxes, inheritance or gift taxes.

Dubai does not levy any wealth, inheritance or gift taxes.

Immigration Rules

EU citizens can enter relatively easily, as can non-EU citizens.

Read our article on how to successfully expat in Andorra?

Foreign residents must obtain a residency visa which is usually tied to employment, real estate ownership, or significant investments in the country. There are different categories of visas, including work visas, real estate ownership visas, and investment visas. It is important to note that Dubai may impose restrictions related to religion, especially in public and commercial practices, so it is necessary to be well informed before moving your family there.

Passport Retention

Andorra does not retain the passports of residents, it is just necessary to provide all the necessary documents for your expatriation, for the classic administrative processing.

As part of the visa and residency process in Dubai, it is common for authorities to withhold applicants’ passports during processing. This may be necessary to process paperwork, such as issuing residency visas or work permits. It is important to know that many testimonies talk about the Kafala system. It is important to stay informed about this system.

Security

Andorra is renowned for being an extremely safe and stable destination, providing a secure environment for residents and expats alike. On the other hand, Dubai can be subject to security fluctuations due to the unstable international climate and regional tensions, but the city is known to be extremely safe.

Financial management

Andorra is known for its clear financial management. The banks, regulated by the Association of Andorran Banks (ABA), are subject to strict standards of transparency and compliance. In addition, the Andorran Financial Authority (AFA) supervises the national finance with rigour, ensuring its own management of the financial system.

On the other hand, Dubai is often criticized for its opaque financial system. Although Dubai has taken steps to increase transparency in recent years, financial management remains less transparent than Andorra’s.

The choice between Andorra and Dubai depends mainly on your individual priorities. If you are looking for a stable tax system with low taxes, a high quality of life, and transparent financial management, Andorra may be a good choice. On the other hand, if you are attracted by a tax-free tax environment, numerous business opportunities and a sunny climate, Dubai may be more attractive despite the considerations related to the geographical location and the totally different financial management that is related to the local political system.

It is important to note that this article does not constitute tax advice and you should always consult with a professional tax professional before making any decision. Considerations about immigration rules, passport retention, security, financial management, and other factors add an important dimension to the decision you have to make.

Andorra’s financial sector is much more than just an economic component of the Principality. With more than 90 years of experience in banking, he represents a model of stability and excellence. Based on the principle of a universal bank, it offers a full range of services, from commercial banking to asset management, private banking and specialist banking.

A Comprehensive Range of Financial Services

Andorran banks are renowned for their ability to provide a multitude of financial services. From wealth management and financial advice to credit operations and financial analysis, they are at the heart of the country’s economic activity. Their offerings also extend to more traditional services such as credit cards and wire transfers, providing a complete solution for their customers.

A highly skilled workforce

The strength of the Andorran financial sector also lies in its human capital. With a highly skilled workforce, the sector benefits from experts with deep expertise in the fields of finance and asset management. This expertise is a major asset that allows financial institutions in Andorra to maintain their reputation for excellence and reliability.

A rigorous regulatory framework

The regulation and supervision of the financial sector is carried out by the Andorran Financial Authority (AFA), established by Law 10/2013. This strict regulation ensures transparency and security in financial transactions, thereby enhancing the confidence of investors and customers. In addition, it contributes to maintaining the stability of the financial system as a whole, which is crucial for ensuring the sustainability of the Andorran economy.

A Pillar of the Andorran Economy

The financial sector occupies a central place in Andorra’s economy, contributing significantly to the Principality’s gross domestic product (GDP). Indeed, it accounts for about 15% of GDP, which underlines its paramount importance in the country’s economic development. In addition, it stimulates economic activity by promoting investment and offering financial solutions tailored to the needs of businesses and individuals.

A Hub for Financial Firms

Thanks to its stable political and social environment, combined with a long tradition of economic dynamism, Andorra attracts many companies from the financial sector. From insurance companies to entities specialising in wealth management and the management of investment institutions, many companies find in Andorra a favourable environment to develop their activities. In addition, the diversification of the financial services offered, also covering non-bank entities with specialised credit, further strengthens Andorra’s position as a regional financial hub.

In conclusion, Andorra’s financial sector is a solid pillar of the Principality’s economy. With its experience, expertise and rigorous regulatory framework, it continues to prosper by offering a full range of financial services. By contributing significantly to GDP and attracting companies in the sector, it plays a crucial role in Andorra’s economic development and its position as a leading regional financial centre.

In addition, the Clickand Business Center stands out for offering high-level financial and tax solutions for foreign investors. Its expertise and in-depth knowledge of the market make Clickand a partner of choice for those looking to take advantage of the opportunities offered by the Andorran financial sector.

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Andorra and France, two European destinations rich in history, culture and natural beauty, are attracting more and more individuals wishing to change their place of residence. However, choosing between these two places is not easy and requires a detailed analysis of different aspects of daily life, economic opportunities, tax systems, and much more. Investing in Andorra when you are French presents an attractive alternative to this complex decision. Located just a few hours’ drive from France, Andorra offers a multicultural environment, with French, Catalan, Spanish and English as commonly spoken languages, facilitating integration and business for French, European and English investors. In addition, the attractive tax advantages, political and economic stability, as well as the geographical proximity to France make Andorra a promising option for those looking to diversify their investments and optimize their tax situation.

Comparison of tax advantages between France and Andorra:

The attractiveness of tax advantages in Andorra goes far beyond the borders of this small country bordering France and Spain. Indeed, for many French, English or German investors, taking an interest in this principality offers a unique opportunity to benefit from an advantageous tax regime and other substantial advantages. In this in-depth exploration, we will take a close look at the tax advantages offered by Andorra, highlighting key differences compared to France.

Income Taxes:

Andorra:

• Progressive tax rate from 0% to 10%.
• Exemption of income up to €24,000.
• Dividends are not taxable by the Andorran government after corporate tax.

France:

• Progressive tax rate from 0% to 45%.
• Personal and family allowance.
• Taxes on dividends and capital gains of up to 30%.

Corporate Taxes:

Andorra:

• Single tax rate of 0.5% capped at 10% depending on the bracket.
• No taxes on profits.
• Possibility of exemption for new taxpayers.

France:

• Tax rate from 26.5% to 33.3% (depending on turnover).
• Possibility of tax deductions for certain investments.

VAT:

Andorra:

• General rate of 4.5%.
• Reduced rate of 1% for certain products and services.

France:

• General rate of 20%.
• Reduced rate of 5.5% for certain products and services.

Other taxes:

Andorra:

• No wealth tax, inheritance tax or gift tax.

France:

• Wealth tax from 0% to 1.5% on net assets above €1.3 million.
• Inheritance and gift taxes, which vary according to family ties and the value of assets.

Tax treaties between France and Andorra:

An agreement between the Principality of Andorra and France avoids double taxation in income taxes and prevents tax evasion.

Quality of life in Andorra and France:

Safe environment with a low crime rate. In Andorra, the political and legal stability is remarkable, as is the modern healthcare system and environmentally friendly infrastructure. On the other hand, France offers an incomparable cultural richness, with its museums, historical monuments and cultural festivals, which attract millions of visitors from all over the world every year.

Economy and employment in Andorra and France:

In Andorra, economic diversification is growing, with a stable labour market and a low unemployment rate. In France, a highly skilled workforce and a large domestic market offer unique advantages for companies seeking diverse talent and growth opportunities. In addition, government policies to stimulate innovation and research can create an environment conducive to the development of new businesses and industries.

In addition, differences in tax regimes can also have an impact on talent mobility. Highly skilled individuals and entrepreneurs may be attracted to Andorra because of its tax advantages and business-friendly environment. This can help create a vibrant community of innovators and professionals in key industries such as technology, finance, and professional services.

Connectivity and infrastructure in Andorra and France:

In Andorra, the efficient road network, the modern and robust constructions, as well as the developed Internet and mobile infrastructure, contribute to making daily life and business easier. In France, a well-developed transport network, including motorways, high-speed railways and international airports, facilitates national and international travel.

In short

Investing in Andorra is a field that is constantly evolving. It is crucial to stay up-to-date with the latest regulations and to call on competent professionals to ensure that your procedures are compliant. With Clickand, our clients can rest assured that they are benefiting from best practices and sound advice to maximize tax benefits legally. Whether it’s to take advantage of the attractive tax advantages, the remarkable quality of life, or the expanding economic opportunities, Andorra offers an environment conducive to investment. However, it is essential to consider individual needs and make an informed choice between this principality and other destinations such as France. Ultimately, whether you choose Andorra or France, careful planning and professional advice are essential to ensure the success of your investment projects.

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Andorra has established itself as a popular destination for tax optimization. Its advantageous tax system and its many advantages attract both individuals and companies looking for legitimate and transparent tax solutions.

Tax Optimization: Definition and Application in Andorra

Tax optimization aims to legally reduce the tax burden. In Andorra, it translates into strategies developed by experienced tax lawyers, in accordance with national and international legislation. Various elements such as types of income, investments, and wealth structure are taken into account to maximize tax efficiency.

How Tax Optimization Works in Andorra

Tax optimization in Andorra is based on 4 key pillars:

1. Tax Residency: Establishing tax residency in Andorra allows you to take advantage of advantageous tax rates on income and assets.
2. Business Creation: Andorra offers a business-friendly tax environment, with low corporate tax rates and attractive tax incentives.
3. International Investments: Diversifying international investments can help reduce the overall tax burden.
4. Tax structuring: Smart tax planning helps optimize the allocation of income and assets to minimize tax impact.

Tax Optimization Strategies for Companies in Andorra

• Choice of legal form: The selection of the right legal structure for the company (SARL, SA, etc.) can influence its taxation.
• Structuring Profits: Optimize the distribution of profits between different entities to minimize the overall tax burden.
• Exploitation of tax incentives: Take advantage of the many incentive programs set up by the Andorran government for companies.

Tax Optimization Strategies for Individuals in Andorra

• Investment Planning: Diversify financial investments by taking into account the tax implications of each type of investment.
• Revenue Planning: Manage the timing and distribution of income to minimize the tax impact.
• Take advantage of favourable tax regimes: Take advantage of specific schemes for retirees, non-domiciled persons, etc.

What are the tax advantages in Andorra?

Andorra stands out for its many tax advantages:

• Low corporate tax rate: The general rate is 10%, with reduced rates for certain business sectors.
• No inheritance and gift taxes: Protection of family assets and tax-free intergenerational transmission.
• Low VAT: The standard VAT rate is 4.5%.
• Double Taxation Avoidance Agreements: Agreements with several countries to avoid double taxation of income.

Compliance with International Standards

Andorra, a signatory to the OECD Declaration, is committed to complying with international standards on transparency and the fight against tax evasion. This guarantees investors the legitimacy and legal certainty of their tax optimisation efforts.

Details of the different tax optimization strategies applicable in Andorra:

1. Tax optimization for companies:

• Choice of legal form: SL, SA, SC, etc., each form having its own tax implications.
• Profit structuring: Allocation of profits between different entities to minimize overall taxation.
• Take advantage of tax incentives: support programs for special economic zones, research and development, innovation, etc.
• Use of the holding company: to hold stakes in other companies and optimize the taxation of dividends.

2. Tax optimization for individuals:

• Investment planning: Choice of tax-efficient investments (life insurance, real estate, etc.) for wealth management and inheritance.
• Take advantage of specific tax regimes: non-domiciled regime, retiree regime, etc

It is important to note that each situation is unique and that tax optimization must be studied on a case-by-case basis by a professional.

In addition to the strategies mentioned above, there are other possible options to optimize your taxation in Andorra. To do this, it is essential to surround yourself with the right advice. That’s where our expertise at Clickand comes in.

At Clickand, we are an accounting and tax firm specialising in tax optimisation in Andorra. Our team of qualified professionals is perfectly equipped to guide our clients, whether they are individuals or companies, in their tax optimization efforts. By working with us, our clients benefit from cutting-edge expertise and personalized support throughout the process.

Tax optimization is a complex and constantly evolving field. It is crucial to stay up-to-date with the latest regulations and to call on competent professionals to ensure that your procedures are compliant. With Clickand, our clients can rest assured that they are benefiting from best practices and sound advice to maximize tax benefits legally.

Bernard M, a successful businessman from Paris, was looking to diversify his investment portfolio. After hearing about the tax benefits and the exceptional quality of life in Andorra, he decided to invest in real estate in this small country nestled in the Pyrenees. He contacted Clickand, an accounting firm specialising in supporting foreign investors in Andorra, to help him make his project a reality. This is the story of Bernard M’s experience with Clickand.

Bernard M’s project was ambitious: he wanted to invest 15 million euros in real estate in Andorra. He wanted to buy several high-end properties, including luxury apartments and mountain chalets. However, he didn’t know much about the Andorran real estate market and needed professional assistance to make his project a reality. That’s why he chose Clickand.

Why choose Clickand to invest in real estate in Andorra?

Clickand is an accounting firm that has been assisting foreign investors in their investment project in Andorra for many years. Thanks to its expertise and its network of local partners, Clickand is able to offer tailor-made support at each stage of the project, from the organization of the departure from France to the legalization of administrative procedures through the connection with builders and real estate professionals.

The organization of the departure from France

To facilitate Bernard M’s arrival in Andorra, Clickand took charge of the organization of his departure from France. The firm took care of booking airfare and accommodation on site, as well as putting you in touch with international movers for the transport of your personal belongings.

Visits and contacts with manufacturers

Once he arrived in Andorra, Bernard M benefited from Clickand’s support to visit different properties that met his investment criteria. The firm also organized meetings with local builders to present their current and upcoming projects. Thanks to these visits and contacts, Bernard M was able to find the properties that perfectly matched his expectations.

Legalization of administrative procedures

Clickand also assisted Bernard M in all the administrative procedures related to his real estate investment in Andorra. The firm took care of the drafting and legalization of sales contracts, as well as obtaining the necessary authorizations from the Andorran authorities. Thanks to this support, Bernard M was able to carry out his investment safely and legally.

Business Portfolio Management

In addition to support for real estate investment, Clickand also offers business portfolio management services for foreign investors in Andorra. Clickand’s founder, Joan-Francesc Montané Debiais, is an expert in wealth management and international taxation. He was able to support Bernard M in the management of his business portfolio in Andorra, offering him personalized solutions adapted to his needs.

Tax optimization

Thanks to its expertise in international taxation, Clickand was able to offer Bernard M tax optimization solutions for his real estate investment in Andorra. The firm was thus able to benefit from the tax advantages offered by the Principality, while respecting the rules and tax obligations in force.

Why invest in real estate in Andorra?

Andorra is a great destination for foreign investors who want to invest their money in real estate. With its pleasant living environment, economic and political stability, as well as its advantageous tax system, the Principality offers many advantages for investors.

A dynamic real estate market

The Andorran real estate market is growing, with attractive prices and sustained rental demand. Investors can thus benefit from an attractive profitability, while benefiting from a long-term increase in the value of their real estate assets.

Attractive tax benefits

Andorra offers an advantageous tax system for foreign investors, including a corporate tax rate of only 10% and no wealth tax. Investors can thus optimise their taxation while enjoying a pleasant living environment.

In short

Planning an investment in real estate in Andorra can be an interesting opportunity for foreign investors who want to diversify their assets and enjoy a pleasant living environment. To make a successful investment, however, it is essential to surround yourself with competent and experienced professionals, such as Clickand. Thanks to its expertise and tailor-made support, Clickand was able to help Bernard M to carry out his real estate investment project in Andorra in the best possible conditions.

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