Taxation in Andorra :
the complete 2026 guide.

Andorra applies one of the gentlest tax systems in Europe — yet it is also a cooperative and transparent state, with genuine taxes and international treaties. Here is the complete, up-to-date 2026 overview, backed by official figures: tax scales, how the calculation works, worked examples, social security contributions and the calendar of obligations.

A simple, clear and light system

Three taxes form the backbone of Andorran taxation: corporate tax (IS), personal income tax (IRPF) and IGI (the equivalent of VAT). All are capped at very low rates. On top of these come moderate social security contributions (the CASS) and a few local taxes of limited scope. Matching this is a notable absence: no wealth tax, and no inheritance or gift tax. The whole system fits into a few pages of tax scales — a striking contrast with the many layers of the French tax system.

Corporate tax (IS) : 10 %

The standard corporate tax rate is 10 % on profit — compared with 25 % in France (reduced rate of 15 % up to €42,500 of profit). Since Llei 5/2023, a minimum effective rate of 3 % has applied, which guarantees the credibility of the regime under international standards. Andorran-source dividends distributed to a resident are exempt from IRPF, which avoids the economic double taxation of profit: once the 10 % corporate tax has been paid, a company’s profit can be distributed without any further friction. Discover our company formation and holding company services — and, for the tax base, the 3 % minimum and the calendar, our guide to corporate tax in Andorra.

Income tax (IRPF) : 0 to 10 %

Andorra’s IRPF is one of the most advantageous in Europe. Its scale fits into three lines (details, formula and examples in our guide to income tax in Andorra):

How it works: a €24,000 allowance plus a rebate

The calculation rests on two cushions. First, a general allowance of €24,000: the first €24,000 of income bears no tax at all. Second, a rebate capped at €800, which lightens the taxation of the band between €24,000 and €40,000 — hence the effective rate of around 5 % on that portion. For income above €40,000, the formula boils down to: (income − €24,000) × 10 % − €800. No family quotient, no low-income relief, no hidden marginal rate: anyone can work out their tax in their head.

Two worked examples — and the same income in France

Income of €60,000: (60,000 − 24,000) × 10 % = €3,600, minus the €800 rebate, i.e. €2,800 of IRPF — an effective rate of around 4.7 %. In France, the 2026 scale (bands at 0 %, 11 %, 30 %, 41 % and 45 %, with thresholds at €11,600, €29,579, €84,577 and €181,917) applied to the same income for a single person (one share, before the décote relief and social levies) gives around €11,100, i.e. ≈ 18.5 % effective — almost four times as much.

Income of €120,000: (120,000 − 24,000) × 10 % − 800 = €8,800 of IRPF, i.e. ≈ 7.3 % effective. The same 2026 French scale, under the same conditions, comes to around €33,000 (≈ 27.5 % effective). And the higher the income, the wider the gap: the Andorran rate is capped at 10 %, while the French marginal rate climbs to 45 %, excluding social levies.

Who is an Andorran tax resident?

Benefiting from IRPF requires being an Andorran tax resident: an effective presence of more than 183 days a year in the country, or having the centre of your economic interests there. Two routes lead there. Active residence concerns those who genuinely live and work in Andorra — company directors, employees, liberal professions — with affiliation to the CASS. Passive residence is aimed at investors: it requires an investment of €1,000,000 (or €400,000 through the Fons de l’Habitatge; any property acquired on this basis must exceed €800,000), a non-refundable contribution of €50,000 to the AFA (plus €12,000 per dependant), income of at least 300 % of the minimum wage and a minimum presence of 90 days a year. Beware of outdated information: the former €600,000 threshold, still shown on many websites, has been obsolete since 22 January 2026 (Llei 2/2026). Note finally that employees under the general quota must present a level A1 Catalan diploma at the first renewal of their permit, then A2 at the second (Law 6/2024) — a very accessible language milestone. Full details on our tax residency page — and, for a decision-oriented reading, what it changes for you.

Social security contributions: the CASS, ≈ 22 % all in

Tax does not tell the whole story: the real cost of labour includes social security contributions. In Andorra, the Caixa Andorrana de Seguretat Social (CASS) takes 6.5 % of gross salary from the employee and 15.5 % from the employer — i.e. ≈ 22 % in total, well below French social charges. This single contribution covers both the health branch and the pension branch.

In return, the CASS reimburses 75 % of outpatient care (consultations, tests) and 90 % of hospital costs within the “via preferent” (with a referring doctor), 33 % outside it, and up to 100 % in certain situations (long-term conditions in particular). The Andorran health system, backed by the neighbouring French and Spanish hospital facilities, regularly ranks among the best rated in the world. For those who wish, a local top-up health insurance covers the remaining share.

IGI : the lowest VAT rate in Europe (4.5 %)

IGI (Impost General Indirecte) stands at 4.5 % at the standard rate, compared with 20 % in France. The system has several rates, all below the European minimums:

• 0 % (super-reduced rate): public health, education, certain essential services;
• 1 %: food, water, books, newspapers and magazines;
• 2.5 %: passenger transport and certain cultural activities;
• 3.5 % (specific rate): the purchase, by a non-professional, of a home intended to be let as a permanent residence;
• 4.5 %: the standard rate, applicable by default — hotels and restaurants included;
• 9.5 % (increased rate): reserved for banking and financial services.

A practical point for entrepreneurs: the registration threshold is set at €40,000 of annual turnover. Below it, the business can remain outside the scope of IGI, which lightens the reporting obligations of very small structures accordingly. Above it, the IGI collected is declared at a frequency that depends on turnover (see the calendar below).

The Andorran tax calendar

Andorran deadlines are few and predictable — one of the reasons why compliance is so easy to keep up with there:

• IRPF: the return is filed between 1 April and 30 September of the year following the tax year. An employee whose only income has already been subject to withholding may even be exempt from filing, under certain conditions.
• Corporate tax: the return is filed within the month following the six months after the close of the financial year — i.e. in July for a year ending on 31 December.
• IGI: settlement is half-yearly (July and January) for annual turnover below €250,000, quarterly (April, July, October, January) between €250,000 and €3.6M, and monthly above that.

Where a French company juggles dozens of deadlines a year, a standard Andorran company has a handful. Our firm coordinates all these filings with our partner accounting firm, so that each deadline is anticipated rather than endured.

Local taxes: how the comuns tax

Each parish (parròquia) is run by its comú, the equivalent of a municipality, which levies a few local taxes: the traditional tax known as foc i lloc (literally “fire and place”, payable by residents), taxes on built property and on rental income, as well as charges on the opening and signage of businesses. Their amounts, set parish by parish, remain modest in scale compared with the French property tax — they run to tens or hundreds of euros a year, not thousands. They complete the picture without changing its balance: the overall tax burden of an Andorran resident remains dominated by IRPF, which is already capped at 10 %.

No wealth tax, no inheritance tax

Andorra has no wealth tax (no equivalent of France’s IFI), and no inheritance or gift tax. This is one of its major advantages for wealth planning, particularly when passing assets on: wealth built up in Andorra passes to the heirs without any Andorran tax friction, whatever its value. See our wealth optimisation services.

Dividends, capital gains and crypto-assets: 0 to 10 %

Savings income follows the same capping logic. Andorran-source dividends are, as we have seen, exempt for a resident. Other investment income and capital gains on securities fall under IRPF, and therefore under its 10 % cap. Crypto-assets have enjoyed a clear framework since Law 24/2022: mere holding is not taxed (no wealth tax applies to it), and capital gains on disposal are taxed at 10 % maximum through IRPF. By comparison, in 2026 France applies a flat tax of 31.4 % to gains on digital assets and to dividends alike (the flat-rate levy raised by the LFSS 2026 — it is no longer 30 %). For an investor, the gap speaks for itself: for the same gain, the Andorran levy is around three times lower.

Property : the foreign investment levy (2026)

Since Llei 5/2025, property acquisition by a foreign investor is capped — one single-family house or two apartments at most per investor, related parties aggregated — and the foreign real estate investment levy (created by Llei 3/2024) was raised by Llei 2/2026 (13 February 2026) to 6 % or 10 % depending on the number of units, with a 90 % reduction when the home is let at an affordable rent, as a primary residence, for at least ten years. On resale, a resident’s property capital gain falls under IRPF (10 % at most): a surcharge of 10 % is added before two years of ownership and of 5 % between two and five years, the gain is reduced by 20 % a year from the sixth year, and it is exempt after ten years — a clear reward for long-term investment. Details in our guide to buying property in Andorra.

Leaving France: the tax treaty and article 167 bis of the French tax code

The switch from one tax system to the other is framed by the Franco-Andorran double taxation treaty, signed on 2 April 2013 and in force since 2015. It sets the criteria that settle tax residency (permanent home, centre of vital interests, habitual abode) and guarantees that the same income is not taxed twice. It is the treaty that gives the transfer of residence its legal certainty: a well-documented departure — an actual home, real presence, economic life on the spot — can be relied upon against the French tax authorities.

One point deserves to be anticipated for large securities portfolios: article 167 bis of the French tax code provides, on departure from France, for taxation of unrealised capital gains where the securities held exceed €800,000. It is a mechanism that is very easy to anticipate with a well-prepared file: payment deferral, the disposal timetable and a suitable structure are planned before departure, not after. This is precisely the kind of path we model with our clients ahead of their move.

Andorra vs France : the gap at a glance

A transparent, treaty-based framework

Contrary to popular belief, Andorra is not an opaque tax haven. The country applies automatic exchange of information (CRS), appears on no blacklist, and has signed more than 20 double taxation treaties — including with France (2 April 2013, in force since 2015), Spain (2015) and Portugal. Andorra’s tax advantage is therefore genuine and internationally recognised.

Want to quantify your situation to the last cent? Our Andorra vs France tax simulator applies both countries’ 2026 tax scales to your actual income in a few seconds. Then let’s discuss your project.