Andorra operates one of the most favourable tax regimes in Europe — yet it is also a co-operative and transparent state, with genuine taxes and international treaties. Here is the complete, up-to-date 2026 overview, backed by official figures.
A simple, readable and light system
Three taxes form the backbone of Andorran fiscal policy : corporate tax (IS), income tax (IRPF) and the IGI (the equivalent of VAT). All are capped at very low rates. And a notable absence : no wealth tax, no inheritance tax, and no gift tax.
Corporate tax (IS) : 10 %
The standard corporate tax rate is 10 % on profit — compared with 25 % in France. Since Llei 5/2023, a minimum effective rate of 3 % applies. Andorran-source dividends distributed to a resident are exempt from IRPF, avoiding the economic double taxation of profits. Discover our company formation and holding company services.
Income tax (IRPF) : 0 to 10 %
Andorra's IRPF is one of the most competitive in Europe :
- 0 % up to €24,000 of annual income (basic allowance) ;
- ≈ 5 % effective rate between €24,000 and €40,000 ;
- 10 % above €40,000.
Tax residency requires an effective presence of at least 183 days per year. See our tax residency page.
The IGI : Europe's lowest VAT rate (4.5 %)
The IGI (Impost General Indirecte) stands at 4.5 % at the standard rate, compared with 20 % in France. Reduced rates apply : 1 % (food, books, medicines), 2.5 % (transport, culture), and a higher rate of 9.5 % on certain financial services.
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 key advantages for wealth management and succession planning. See our wealth optimisation services.
Property : the foreign investment levy (2026)
Since Llei 2/2026 (in force from 13 February 2026), property acquisition by a foreign investor is subject to a levy of 6 % to 10 % depending on the rank of acquisition. A substantial reduction applies when the property is let as a long-term primary residence. Full details in our guide on buying property in Andorra.
Andorra vs France : the gap at a glance
| Tax | Andorra | France |
|---|---|---|
| Corporate tax | 10 % | 25 % |
| Income tax (max) | 10 % | 45 % (+ social contributions) |
| Dividends | 0 % (Andorran source) | 31.4 % (PFU 2026) |
| VAT / IGI | 4.5 % | 20 % |
| Wealth tax | None | IFI up to 1.5 % |
| Inheritance tax | None | Up to 45 % |
| 2026 rates. The French flat-rate tax on dividends increased to 31.4 % on 1 January 2026 (LFSS 2026). | ||
A transparent, treaty-based framework
Contrary to popular belief, Andorra is not an opaque tax haven. The country operates automatic exchange of information (CRS), appears on no blacklist, and has signed more than 20 double-taxation agreements — including with France (2 April 2013), Spain (2015) and Portugal. Andorra's tax advantage is therefore genuine and internationally recognised.
Key takeaways
- CT : 10 % (minimum effective rate 3 %) · Andorran-source dividends exempt
- IRPF : 0 % up to €24,000, then ≈5 % and 10 % max
- IGI (VAT) : 4.5 %, the lowest in Europe
- No wealth tax, no inheritance tax
- Co-operative state : CRS + treaties (France, Spain, Portugal…)
Want to model your own situation? Try our Andorra vs France tax calculator, then let's discuss your project.
