{"id":11727,"date":"2022-11-03T13:05:18","date_gmt":"2022-11-03T13:05:18","guid":{"rendered":"https:\/\/www.mc-expatriation.com\/creating-company\/fiscaliste-comptable\/"},"modified":"2026-09-09T06:48:27","modified_gmt":"2026-09-09T06:48:27","slug":"tax-accountant","status":"publish","type":"page","link":"https:\/\/www.mc-expatriation.com\/en\/creating-company\/tax-accountant\/","title":{"rendered":"Setting up a company in Andorra with a tax accountant: procedures, taxation and key considerations"},"content":{"rendered":"\n
Setting up a company in Andorra can be an attractive option for an entrepreneur looking to develop an international business, but the project should be approached from a broader perspective than taxation alone. Lower taxation, by itself, is not enough to make an establishment worthwhile. It is also necessary to consider the activity actually carried out, where the company is managed from, the tax residency of its shareholders, accounting obligations and banking relationships. <\/p>\n\n
This is precisely where a tax accountant familiar with Andorran law can add value. Their role is not simply to find the lowest tax rate. Above all, they should help build an organization that is coherent, compliant and defensible in light of the entrepreneur's actual situation. <\/p>\n\n
Why seek professional assistance when setting up a company in Andorra?<\/h2>\n\n
Andorra attracts French, Spanish and international entrepreneurs because of its tax environment, geographical location and business-friendly framework. However, incorporating a company in the Principality is not simply a matter of submitting a few documents and opening a bank account. <\/p>\n\n
The first step is to determine whether Andorra genuinely fits the way the business operates. A self-employed consultant, an e-commerce business making sales in several countries and a technology company employing an international team will not have the same tax constraints or legal requirements. <\/p>\n\n
Ideally, the tax accountant should be involved before the company is incorporated. They can review the source of income, the country of residence of the directors and shareholders, the expected financial flows, the director's remuneration, any potential dividend distributions and tax obligations that may remain in other countries. <\/p>\n\n
This assessment is particularly important for entrepreneurs leaving France or continuing to carry out part of their business there. Incorporating a company in Andorra does not automatically determine the tax residency of its director, nor does it eliminate the rules applicable to activities carried out in another country. The tax treaty between France and Andorra addresses, among other things, tax residency and the concept of a permanent establishment, two issues that must be analyzed separately from the mere registered office address. <\/p>\n\n
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What is the taxation for a company in Andorra?<\/h2>\n\n\n\n
One of the Principality's main attractions remains its corporate income tax. The general Andorran corporate income tax rate is currently set at 10%. However, specific regimes and rules may affect the amount actually payable depending on the nature of the income, applicable deductions or the company's tax regime. <\/p>\n\n\n\n
It is therefore preferable to refer to a general 10% rate rather than systematically promise a lower effective tax burden. The final amount depends on the company's actual tax situation. <\/p>\n<\/div><\/div>\n\n
Andorra also applies an indirect tax known as IGI, which is broadly comparable to VAT. Its standard rate is 4.5%. Other rates exist, including 0%, 1%, 2.5% and 9.5%, depending on the nature of the transaction concerned. <\/p>\n\n
For a company selling services or products internationally, however, the 4.5% rate does not mean that every invoice will automatically be subject to Andorran IGI. The treatment depends, among other things, on the type of service, the customer's location, whether the customer is a business or an individual, and the applicable territoriality rules. This issue deserves particular attention for digital businesses, consulting services, software, online platforms and e-commerce. <\/p>\n\n
Dividends require the same degree of caution. Exemption mechanisms exist under Andorran tax law, particularly in certain situations involving corporate shareholdings, but their application depends on specific conditions. A tax ruling published by the Andorran administration in 2025, for example, recalls that certain dividend-related exemptions are subject to cumulative substantive and formal requirements. Presenting dividends as systematically tax-exempt would therefore be misleading. <\/p>\n\n
Andorra has also entered into several treaties designed to prevent double taxation, notably with France, Spain and Portugal. These treaties do not provide general tax exemptions: they determine which country has the right to tax certain types of income and under what conditions. <\/p>\n\n
Social security contributions: understanding what the 22% rate actually represents<\/h2>\n\n
For employees covered by the general Andorran social security system, CASS currently states that total contributions amount to 22% of salary. The employee's share is 6.5%, while the employer's share is 15.5%. <\/p>\n\n
This figure should nevertheless be put into context. It should not be applied indiscriminately to a company director, self-employed worker or shareholder carrying out an activity on their own behalf. CASS provides specific rules for self-employed workers and different professional statuses. The actual social security cost must therefore be calculated based on the individual's situation rather than through a simple comparison with France or Spain. <\/p>\n\n
This is precisely the kind of detail that can turn an attractive tax simulation on paper into a much less advantageous project once all contributions and obligations are taken into account.<\/p>\n\n
SL, SLU, SA or SAU: which company structure should you choose in Andorra?<\/h2>\n\n
The main forms of commercial companies available to entrepreneurs are the limited company, or SL, and the public limited company, or SA. They can also be incorporated as single-member entities, respectively SLU and SAU. The choice of structure is made during the company name reservation process. <\/p>\n\n
The SL is generally suitable for small and medium-sized businesses, consultants, family businesses and many entrepreneurial projects. Its minimum share capital is \u20ac3,000. The shareholders' liability is generally limited to their contributions. <\/p>\n\n
The SA is more suited to projects requiring significant capital, a more structured shareholder base or an organization designed to accommodate several investors. Its minimum share capital is \u20ac60,000. <\/p>\n\n
However, the choice should not be based solely on the amount of capital required. The desired governance structure, potential future investors, nature of the business, banking requirements, remuneration strategy and the way the company may evolve should also be taken into account. <\/p>\n\n
The Andorran Government also specifies that a company may be managed through different forms of management bodies, such as a sole director, several directors or a board of directors.<\/p>\n\n
How does the process of setting up a company in Andorra actually work?<\/h2>\n\n<\/figure>\n\n
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