Andorra Tax Residency

Are you interested in obtaining tax residency in Andorra in conjunction with forming a company? Are you considering one of the many fiscal advantages offered by Andorran passive residency? Whatever brings you to Andorra you will need assistance with the immigration office, finding housing, and moving your family and belongings. We will help you with all queries related to a certificate of residence to claim tax relief in Andorra!

Establishing Andorra tax residency requires the expertise of a local tax consultancy, to streamline all the steps. Andorra Partner can help you to integrate quickly into the country, with everyday life needs, and the formation of a company. Andorra offers different types of residency depending on your profile. If you wish to open a business in Andorra and create a company, active residency is the most appropriate option for you. Being the director and shareholder of an Andorran company automatically gives you the right to apply for residency which in turn gives you the right to be self-employed.

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How to Become Tax Resident in Andorra?

Before we discuss in detail the requirements needed to obtain the tax residence in Andorra, we must differentiate two concepts that are often confused: the administrative Andorra residency and the tax residence. The administrative residence is granted by the competent immigration authorities, whereas the tax residence is not acquired in parallel, but is consolidated once a series of requirements set out in the current tax legislation have been fulfilled.

There are different modalities to obtain the administrative residence (the following are the 3 most consolidated):

As we have already mentioned, the administrative residence is diametrically different from the fiscal residence since the latter is consolidated based on criteria not linked to the immigration regulations, however, what are the requirements to be considered an Andorran fiscal resident?

Tax Residency Andorra: Requirements

The criteria to consider a person a tax resident in a certain country is governed by the general criteria of the OECD, harmonized in the Principality, and duly included in the law of the IRPF tax of Andorra.

Said legislation establishes that a person will be considered a tax resident in Andorra if:

Therefore, once the above-mentioned requirements have been met, it is possible to notify the relevant tax authorities of the change of tax residence and be taxed in Andorra.

Why Consider Tax Residency in Andorra?

Andorra has a lot to offer apart from lower than usual tax rates. Many clients looking for low-tax countries in Europe end up moving to the country for quality of life.

Tax Residency Andorra: FAQ

Can I Become a Tax Resident Without Living in Andorra?

No, you must spend at least 90 days in Andorra if you plan to become a passive resident. For other types of residency, a permanent stay is recommended (excluding business trips and vacations). You need to have a permanent address at all times, whether rented or purchased property.

Can I Live Between Several Countries or Travel Most of the Year?

Technically, you can be a resident in more than one country by having legal residency status in all of them. However, please note that tax residency is usually declared only in one country where all your worldwide income must be declared.

How Much Does it Cost to Become a Tax Resident in Andorra?

Andorra requires a refundable deposit of €15,000 for active residents who are shareholders or partners. The amount of €50,000 is required for passive/non-profit residents. Other types of residency, such as work permits or family reunification, do not require a deposit. The legal fees charged by AndorraPartner range from €1,000 to €3,500, depending on the type of residency.

How Long Does it Take to Become a Tax Resident in Andorra?

The duration of obtaining the residency process depends on the type of visa permit. It can take from 1 to 4 months. In general, active residencies are quicker to apply for once the company or employment has been established.

Is the Tax Residency in Andorra Passive or Active?

Tax residency in Andorra does not depend only on the type of residence permit but on many aspects of your personal life and financial income.