How to become a tax resident in Andorra?
Conditions for Obtaining Tax Residency in Andorra
Andorra is a sought-after destination for those looking to establish their tax residency in Europe. However, it’s crucial to note that administrative residency in Andorra doesn’t automatically guarantee tax residency. In this update, we’ll explain the conditions and steps to become a tax resident in Andorra.
1. Minimum Stay of 183 Days:
– Stay in Andorra for a minimum of 183 days during a calendar year. Occasional absences are allowed but will be considered.
2. Engage in Economic Activity:
– Carry out economic activities in Andorra, such as operating a business that is tax-resident in the country.
3. Live with Family:
– Reside with your spouse and children under 18 in Andorra to qualify for tax residency.
4. Retirement Option:
– It’s also possible to relocate to Andorra upon retirement.
If these criteria are not met, the individual’s nationality is considered to determine the tax jurisdiction, which is crucial for businesses and tax residency.
To streamline your move to Andorra, you can seek assistance from Clikand, a specialized company that supports expatriates with administrative processes, housing search, and school enrollment.
Two Paths to Tax Residency
There are two ways to become a tax resident in Andorra, each with its own conditions:
1. Active Residency Application:
– For employees in an Andorran company, entrepreneurs, or those with entrepreneurial projects.
– Requirements include being present for over 183 days, having the business registered in one of Andorra’s 7 parishes, hiring at least one person, and targeting some activities towards a foreign market.
– A refundable deposit of over €50,000 with the Andorran Financial Authority (AFA) is required.
2. Passive Residency Application:
– For those without a professional activity or business in Andorra.
– Requirements include residing for at least 90 days annually and making an investment in the country, such as in real estate or the financial sector.
– An investment of at least €600,000 in real estate or an Andorran company and a minimum deposit of €50,000 with the AFA are mandatory.
Becoming a tax resident in Andorra follows a well-defined process with strict criteria. For professional assistance throughout the process, Clikand can guide you at every step. Whether you opt for active or passive residency, Andorra offers attractive tax opportunities for those meeting its requirements.
