Good to know
Good to Know
- You do not need an Andorran co-founder or sponsor to incorporate — 100% foreign ownership has been allowed since 2012 in most sectors — but you do still need a real registered office address in Andorra.
- Company formation by itself does not grant you residency. If your goal is to move to Andorra on the back of the company (active residency), that route separately requires being a majority shareholder in a management role and placing a non-refundable deposit (commonly cited around €50,000) with the Andorran Financial Authority — a distinct process from incorporation itself.
- There are no off-the-shelf 'shelf companies' in Andorra — every incorporation, including any change of ownership in an existing company, goes through the same foreign-investment vetting.
- Budget for the bank account opening and compliance review as the step most likely to blow past your expected timeline, especially as a non-resident — some formation agents say this is the single biggest bottleneck, more than the notary or registry filing.
- Andorra's flat 10% corporate tax rate applies whether you incorporate a company or, for most solo freelance activity, operate as a self-employed 'compte propi' worker taxed under personal income tax at the same 10% headline rate - the real decision driver is usually liability protection and dividend-planning flexibility, not the tax rate itself.
- A company structure requires real physical substance in Andorra (commercial premises, generally around 20 sqm, and genuine local management) - offshore-style shell companies without local presence are explicitly discouraged by Andorran advisors and risk being challenged by foreign tax authorities.
- The EUR 50,000 AFA deposit required for the shareholder-director residency route became non-refundable under a law change that took effect in January 2026 - budget for this as a sunk cost, not a temporary deposit, if relocating under that route now.
- All official filings and most local administrative interactions happen in Catalan, so budget for a local gestoria/accountant even if your business is entirely English-language and international-client-facing.
- Sources disagree on some numeric details (exact corporate filing deadlines, and whether the older-route company deposit was EUR 15,000 or the newer EUR 50,000 figure) - always confirm current numbers with a local gestoria before committing, as Andorra's business/residency rules have changed multiple times recently.
VAT Igi
- Standard Rate Pct
- 4.5
- Note
- Andorra's IGI (General Indirect Tax) is charged quarterly by registered businesses; some cross-border B2B services to international clients may fall outside IGI scope, though this depends on the specific service and client location and should be confirmed with a local accountant.
Reduced Rates Pct
- 0
- 1
- 2.5
- 9.5
Freelancer Sole Proprietor Vs Company
Company Sl Route
- Afa Deposit
- €50,000
As of a law change effective January 2026, this deposit to the Andorran Financial Authority (AFA) is described by multiple advisory sources as non-refundable on departure, a change from the earlier regime where it was returned when residency ended.
- Tax Treatment
- Profit is taxed under Corporate Income Tax at the standard 10% rate; if the owner later draws dividends as an Andorran tax resident from local company profits, those dividends are exempt from personal income tax, giving more flexibility to plan or defer personal income than pure freelance status.
- Residency Mechanics
- To get self-employed residency via a company, the foreigner must hold more than 34% of the share capital, sit on the company's board as administrator, obtain the foreign investment authorization, and reside in Andorra at least 183 days per year.
- Who Typically Uses This
- Content creators, engineers, consultants, and digital-service providers most often use the SL (limited-company) route since it caps personal liability and gives full access to Andorran tax-resident benefits.
Registration Costs
Company Registration Fee Range
- Amount USD Low
- 1143
- Currency Local
- EUR
- Amount USD High
- 1715
- Amount Local Low
- 1000
- Amount Local High
- 1500
- Note
- Registry fee range cited by one source as of 2022 figures; verify current cost before proceeding, as fees can change.
Freelancer Compte Propi
- Tax Treatment
- Taxed under personal income tax (IRPF) on net profit, generally at the standard 10% rate with no progressive brackets, though reductions apply that lower the effective average rate for income under EUR 40,000.
- Admin Simplicity
- Tax and registration procedures are simpler than for a company: no registered office is legally required, no company deed or Companies Register filing, and no separate corporate accounting regime.
- Eligibility Limits
- To register purely as a freelance 'liberal professional' (without forming a company), Andorra generally restricts this route to qualified/regulated professions (e.g. law, engineering, architecture, consulting) where the applicant holds a recognized higher-education qualification, and it does not permit unrestricted commercial or e-commerce activity the way a company structure does.
- Capital Requirement
- This route is commonly described as not requiring the larger AFA investment deposit that the company/shareholder-director residency route requires, though at least one source states a smaller EUR 15,000 deposit applied to a version of this route - treat that specific figure as unconfirmed against current 2026 rules.
Ongoing Professional Support Cost
Monthly Accounting Gestoria Fee Range
- Amount USD Low
- 114
- Currency Local
- EUR
- Amount USD High
- 229
- Amount Local Low
- 100
- Amount Local High
- 200
- Note
- Typical range cited for outsourced bookkeeping/tax-filing support for a self-employed person; company accounting support is generally described as more involved (and costlier) than for a sole freelancer.
Core Steps
Get an Administrative Identification Number (NIA)
- Detail
- Required for any non-resident before they can take administrative action in Andorra. Needs passport copy and proof of address.
- Typical Duration
- 1 to 2 business days
Reserve the company name
- Detail
- Submit up to three name options (in order of preference) with the intended legal form (SL, SLU, SA) to the Registre de Societats (Companies Registry).
- Typical Duration
- About 10 business days
Obtain foreign investment authorization
- Detail
- Mandatory for any non-resident owning more than 10% of the capital. Requires an apostilled/legalized passport, an apostilled criminal record certificate (usually valid only 3 months), CV/professional background, a business plan, and proof of the legal source of funds.
- Typical Duration
- Roughly 10-15 business days for straightforward files; up to 1 to 1.5 months if the file is complex or incomplete
Open an Andorran bank account and deposit the share capital
- Detail
- Banks run their own KYC/AML review (identity, nationality, business activity, source of funds) before issuing the deposit certificate a notary needs to proceed. May require an in-person visit.
- Typical Duration
- Roughly 1 to 4 weeks; often the slowest step for non-residents
Sign the deed of incorporation before an Andorran notary
- Detail
- The notary certifies the articles of association and company charter and files them with the Commercial Registry.
- Typical Duration
- About 1 week to arrange and finalize signature
Must be completed within 20 days of signing
- Step
- Register with the Registre de Societats Mercantils (Commercial Registry)
- Detail
- Gives the company legal existence; without this registration the company does not legally exist even if the deed is signed.
Obtain the Tax Registration Number (NRT)
- Detail
- Needed for tax and administrative purposes and must appear on all invoices.
- Typical Duration
- About 1 week
Obtain a trade/commercial license
- Detail
- Issued jointly by the national government and the local Comú (parish town hall) covering the location of the registered office; required before the business can legally start invoicing.
- Typical Duration
- Varies by activity and parish
Typical Costs
- Government Registry And Admin Fees
- €2,000
Combined name reservation, foreign investment fee, notary (~€500), Company Registry fees, municipal/trade-license fees; excludes professional advisory fees. Figures vary by source.
Professional Legal Advisory Fees
- Currency Local
- EUR
- Amount USD Range
- 3432-11440
- Amount Local Range
- 3000-10000
- Note
- Depends on number of shareholders, residency status, and urgency; full-service turnkey packages from formation agencies have been quoted as high as roughly €10,800-€11,500 plus VAT.
Total All In Excluding Share Capital
- Currency Local
- EUR
- Amount USD Range
- 6864-12584
- Amount Local Range
- 6000-11000
- Note
- Combined government fees plus typical advisory fees, excluding the mandatory share capital deposit.
Local Partner Or Sponsor Mandate
- Status
- Fully legal and regulated
- Summary
- No Andorran co-owner or sponsor is legally required. Foreign investors can hold up to 100% of an Andorran company's capital in most sectors.
Details
- Since a 2012 reform, foreigners can own 100% of a company in over 200 economic sectors, removing the previous rule that capped foreign ownership at 49% and required an Andorran shareholder.
- Directors and shareholders can be of any nationality and are not required to reside in Andorra.
- The company must still have a genuine registered office/address inside Andorra, and non-resident owners over a 10% ownership threshold must separately obtain a foreign investment authorization (not a local-partner requirement, but a government clearance step).
Filing And Fiscal Year
- Fiscal Year
- Calendar year for individuals; for companies, matches the company's own accounting period but cannot exceed 12 months.
- Deadlines Note
- Sources disagree on exact deadlines: one source states the corporate tax return and payment are due in July, with a 50%-of-prior-year advance/fractioned payment due in September; another states the advance payment is in September and the final declaration/payment falls between September 1-30 of the following year. Given this inconsistency and recent regulatory changes, confirm current deadlines with a local gestoria before relying on either figure.
Physical Presence Requirement
Foreign nationals cannot register or maintain either self-employed status or active-residency company ownership in Andorra without establishing genuine physical residency and spending at least 183 days per year in the country - this is not a paper/offshore structure.
Corporate Tax Resident Companies
- Standard Rate Pct
- 10
- Reduced Rate Conditions
- A reduced rate of around 2% can apply during a new company's first tax period (or, per some advisory sources, first two years) if the registered office and effective management are genuinely in Andorra, and separately for income from qualifying international trading activities. Some firms also cite an 80% exemption on income tied to intangible assets, international goods trading, or intragroup management/investment activity for qualifying holding-type structures.
- Capital Gains
- Generally taxed at the standard 10% rate as part of ordinary profit, though gains from disposal of qualifying foreign subsidiaries by holding structures can be exempt under the participation exemption regime.
- Notable Deductions
- A tax credit of roughly 5% of investment in fixed assets in Andorra is available, plus general deductions for hiring new employees and qualifying reinvestment.
- Loss Carryforward Years
- 10
- Dividends And Withholding
- Dividends paid by an Andorran company to an Andorran tax-resident shareholder are not subject to further personal tax (0%), and Andorra does not apply withholding tax on dividends or interest paid to non-resident shareholders.
- Description
- Andorran-incorporated companies, and foreign companies with their place of effective management in Andorra, are taxed on worldwide profits under the Impost de Societats (Law 95/2010).
Non Resident Companies Territorial Regime
- Rate Pct
- 10
- Description
- Non-resident entities are only taxed on Andorran-source income (a territorial system), generally at 10%, with royalties taxed at 5% and dividends/interest from Andorran sources exempt from the non-resident tax.
Entity Types
- SA
- Public limited company, reserved mainly for larger enterprises, banks, insurers, or listed companies; managed by a Board of Directors with mandatory annual audit.
- SL Or SLU
- Limited liability company (SL) or its single-member version (SLU) — the most common form for foreign-owned SMEs and service businesses. Minimum two founders for SL (any nationality, resident or not); SLU allows a single founder/single director.
Typical Timeline
- Bottleneck Steps
- The foreign investment authorization and the bank's KYC/compliance review (opening the corporate account) are consistently cited as the slowest and least predictable stages, more so than the notarial/registry filing itself.
- Overall For Non Residents
- Most sources converge on roughly 2 to 4 months from starting the process to being fully operational (registered, bank account funded, trade license issued); some report as fast as 1-3 months for simple cases, and up to 6 months where the foreign investment authorization or bank compliance review is complicated.
Official Government Resources
Official Government Resources
- e-tramits.ad — the Government of Andorra's electronic portal for filing foreign investment authorization applications and other administrative procedures.
- Registre de Societats / Registre de Societats Mercantils — the Companies Registry under the Govern d'Andorra where names are reserved and companies are formally registered.
AI-generated estimateData refreshed July 2026
This section has no cited sources.
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Data last updated July 2026 · Verify anything important.