Taxes in Andorra: advantageous taxation
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:
- IGI (General Indirect Tax)
- IRPF (Personal Income Tax)
- 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:
| Country | VAT | Corporate Tax | Income Tax |
|---|---|---|---|
| Andorra | 4,5% | 10% | 10% max |
| France | 20% | 33,3% | 40% |
| Spain | 21% | 25% | 45% |
| Portugal | 23% | 31,5% | 48% |
| Germany | 19% | 29,8% | 45% |
These figures clearly illustrate the tax attractiveness of Andorra.
Tips for optimising your taxation in Andorra
- Consult a local tax expert
- Choose your parish of residence wisely
- Benefit from the benefits for new businesses
- Structure your income optimally
- 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.
