Spain and Andorra share a border, a language (Catalan) and close ties — but not the same tax system. For a heavily taxed Spanish resident, Andorra represents a credible alternative, all the more so because a tax treaty governs the transition. Here is the full comparison.
The tax gap : income and wealth
In Spain, the IRPF reaches a marginal rate of 47 % at the national level, and exceeds 50 % in certain autonomous communities (Catalonia, Valencia). On top of that come the wealth tax (Impuesto sobre el Patrimonio) and the solidarity tax on large fortunes, a VAT (IVA) at 21 % and a corporate tax at 25 %. In Andorra : a maximum of 10 % on both income and corporate profits, 0 % on Andorran-source dividends, no wealth or inheritance tax, and IGI at 4.5 %.
The comparison, figure by figure
| Tax | Andorra | Spain |
|---|---|---|
| Income tax (max) | 10 % | 47 % → ~54 % (depending on the region) |
| Corporate tax | 10 % | 25 % (15 % start-ups) |
| Dividends / savings income | 0 % (Andorran source) | 19 % → 30 % (base ahorro) |
| VAT / IGI | 4.5 % | 21 % |
| Wealth tax | None | Patrimonio + large fortunes levy |
| Inheritance tax | None | Variable by region |
| Indicative 2026 rates. In Spain, wealth and inheritance taxes depend heavily on the autonomous community. | ||
An organised transition via the 2015 treaty
Spain and Andorra are bound by a double-taxation agreement (in force since 2016). It allocates taxing rights and provides certainty for the transition. The key remains the same : establishing genuine Andorran residency — actually living there and relocating one's centre of interests. Properly prepared, your move is solid and reassuring ; this is precisely what we orchestrate for you.
The verdict : for whom ?
For a high-income or high-net-worth Spanish taxpayer, Andorra substantially reduces the tax burden — just a few kilometres from Catalonia, within a treaty-based framework. The condition : a genuine and well-prepared relocation.
Key takeaways
- Spain : IRPF up to ~54 %, wealth tax + large fortunes levy, IVA 21 %
- Andorra : 10 % max, 0 % dividends/wealth/inheritance, IGI 4.5 %
- Double-taxation treaty in force (2016)
- Transition secured by genuine Andorran residency
- A few kilometres from Catalonia, within the EU customs union
Want to quantify your gain? We model your situation and build your Andorran tax residency. Also see the tax advantages of Andorra.
