Settling in Andorra is entirely legal, transparent and governed by treaty. The risk, then, is not a legal one: it is an evidentiary one. When a taxpayer is reassessed after moving to the Principality, it is almost never because the arrangement was unlawful — it is because they were unable to prove, document in hand, that their life had genuinely relocated.
This guide sets out what each tax authority looks at, how the Franco-Andorran treaty settles any conflict between the two, and, above all, which documents to gather, and when. It is the work we carry out with every client, year after year.
Two tax authorities, two definitions
Tax residency is not a box you tick: it is a status inferred from facts. Andorra and France, however, do not look at exactly the same facts, and nothing technically prevents both countries from each considering you their resident. It is precisely this double claim that must be made impossible.
What makes you an Andorran tax resident
Andorran income tax law recognises two alternative routes. You are an Andorran tax resident if you spend more than 183 days per calendar year within the territory of the Principality; or if the main core of your business activities or economic interests is located there, directly or indirectly. A useful presumption is added to this: when your non-separated spouse and dependent minor children habitually reside in Andorra, your own residency there is presumed.
Two points matter here. First, temporary absences are deemed to be included within the 183 days, unless tax residency in another country can be evidenced. Second — and this is the most common source of confusion — a residence card is not tax residency.
90 days ≠ 183 days
The passive residency route requires actual presence of at least 90 days a year to keep the permit. That is an immigration requirement. Tax residency, by contrast, turns on the 183-day rule or the centre of economic interests. You can therefore hold a perfectly valid Andorran residence card… and remain a French tax resident. Confusing the two is the costliest mistake we see.
What makes you a French tax resident
Article 4 B of the French tax code (CGI) sets out three criteria, and just one is enough to bind you to France:
- you have your home there — the place where your family habitually resides — or, in the absence of a home, your main place of abode;
- you carry out your main professional activity there, whether employed or not, unless it is ancillary;
- you have the centre of your economic interests there: the place of your main investments, the seat of your business affairs, and the bulk of your income.
The concept of home is a particularly formidable one: it refers to the family's habitual living place, irrespective of business travel. An executive who travels eleven months a year but whose spouse and children live in Bordeaux has his home in Bordeaux.
When both countries claim you: the tie-breaker rules
This is the role of the Franco-Andorran tax treaty of 2 April 2013, which entered into force on 1 July 2015. It sets out a cascade of criteria, applied in order: you move to the next one only if the previous one fails to settle the matter.
| Order | Criterion | What is actually examined |
|---|---|---|
| 1 | Permanent home | Accommodation you have on a durable basis — owned or rented — in only one of the two States. |
| 2 | Centre of vital interests | Where your personal and economic ties are closest: family, wealth, activity, social life. |
| 3 | Habitual abode | The country where you stay most frequently, over a representative period. |
| 4 | Nationality | A residual criterion, used only if the previous three remain silent. |
| 5 | Mutual agreement | Negotiation between the two tax authorities. Lengthy, uncertain: best avoided. |
| France–Andorra tax treaty of 2 April 2013, in force since 1 July 2015. | ||
The practical consequence is simple and too often ignored: keeping accommodation available all year round in France knocks out the first step. You then fall back on the centre of vital interests, markedly more subjective ground, where the tax authorities have far more latitude. A family home left furnished, heated and accessible ‘for the holidays’ has cost more cases than any sophisticated scheme.
The treaty's blind spot: the nationality clause
The Franco-Andorran tax treaty contains a peculiarity found in virtually no other treaty signed by France. Its Article 25, paragraph 1(d) reserves France's right to tax its nationals resident in Andorra without regard to the provisions of the treaty.
Where does this stand today? This right has never been exercised. It requires the French legislature to adopt measures to that effect — in other words, to substitute, for Andorra, a nationality criterion for the tax-domicile criterion. Asked about this in May 2016, the government replied that no such measure was planned, and nothing has changed since. It is therefore not a present-day risk. But nor is it a guarantee set in stone.
The right reading is neither alarmist nor complacent. It is this: base your situation on solid facts, not on the hope that a dormant clause stays dormant. A residency file grounded in a life genuinely lived protects you in every scenario.
What the treaty does not cover: the IFI
The 2013 treaty deals only with income taxes. The French real-estate wealth tax (IFI) falls outside its scope, and no tie-breaker rule protects you on this front.
In concrete terms: once you become an Andorran tax resident, you remain liable for the IFI in France on your French real estate alone, provided its net taxable value exceeds €1.3M. Your Andorran and foreign assets fall outside its scope — already a considerable gain — but French real estate remains within the tax base.
The right move is made before departure: arbitrate, restructure or sell. It is one of the strands we systematically address in a well-run tax optimisation strategy, alongside the exit tax.
The evidence file, piece by piece
Here is the heart of the matter. A solid file rests on four categories of evidence, and on one absolute rule: it is built continuously, as you go. A file reconstructed after receiving an information request is spotted immediately — documents issued in a batch, invoices downloaded on the same day, complaisant certificates. Set up a shared file from month one and feed it every quarter.
1. Home: where you actually live
- An Andorran lease or purchase deed in your name, covering the entire period concerned;
- rent receipts, service-charge statements, local taxes;
- electricity (FEDA) and telecoms (Andorra Telecom) bills — with consumption consistent with an actually occupied home;
- a residence certificate issued by your comú (parish council);
- an Andorran home-insurance policy;
- a removal invoice and inventory of the furniture transferred.
The decisive detail: the consumption curve. A flat using 40 kWh a month does not tell the same story as an occupied home.
2. Physical presence: evidencing the days
- Andorran residence card and immigration paperwork;
- statements from an Andorran bank account showing everyday local spending — groceries, fuel, pharmacy, restaurants;
- toll receipts, fuel fill-ups, transport tickets, boarding passes;
- a day-by-day presence calendar kept in a dated file — never reconstructed;
- local subscriptions: gym, ski pass, parking space, club;
- medical consultations in Andorra and CASS reimbursements.
Conversely, a French bank card used daily in Paris while you ‘reside’ in Canillo is the most effective evidence there is — against you. The geographical consistency of your spending is the first thing an auditor checks.
3. The centre of vital interests: your life, not just your address
- Actual relocation of your spouse and children;
- certificate of enrolment at an Andorran school;
- affiliation to CASS and deregistration from French social security;
- GP, dentist, vet, insurance policies taken out locally;
- a vehicle registered in Andorra, Andorran insurance and driving licence;
- club memberships, sports licences, local life.
In practice, the children's schooling is the single most decisive element of the whole file. No tax authority believes a household has genuinely relocated when the children remain in school in France.
4. The centre of economic interests
- A genuinely operational Andorran company: commercial lease, employees registered with the CASS, local suppliers, invoices issued from Andorra;
- Andorran bank accounts into which your income is paid;
- tax residency certificate issued by the Departament de Tributs i de Fronteres;
- an Andorran IRPF return filed every year, even when no tax is due;
- closure or reduction of French income sources that have become unnecessary.
The classic mistake: the Andorran company genuinely exists, but every decision is made from France. It then becomes taxable in France under its place of effective management — a subject we cover in detail in our guide a company in Andorra without living there.
| Category of evidence | The document that carries the most weight | What weakens the file |
|---|---|---|
| Home | Andorran lease or deed + energy bills | Accommodation kept available in France |
| Presence | Daily spending on an Andorran account | French card used every day in France |
| Vital interests | Children schooled in Andorra | Family left in France ‘temporarily’ |
| Economic interests | Operational company + tax certificate | Decisions made from France |
| A file is never ‘perfect’: it is consistent. It is the overall consistency that carries conviction. | ||
The six mistakes that bring a file down
- Keeping accommodation available all year round in France. You lose the first, most objective and most favourable tie-breaker criterion.
- Leaving the family in France ‘until the school year finishes’. This transition year is almost always the one that gets reassessed.
- Actually running the business from France. The place of effective management, the permanent establishment concept, and Articles 155 A and 123 bis of the CGI exist precisely for this.
- Confusing a residence card with tax residency. 90 days validates a permit; it does not validate 183 days.
- Reconstructing evidence after the fact. A file dated to the month of the audit carries no evidential weight.
- Rushing the year of departure. The transition-year return, the address change with the non-residents' individual tax office, French-source income: this is the most closely scrutinised year.
The tax residency certificate: necessary, never sufficient
The certificate issued by the Andorran tax authorities is an essential document. It unlocks the benefit of the treaty, in particular to stop certain withholdings on your French-source income (treaty forms 5000 and 5003 rely on it).
But it does not bind France. If the facts do not follow — main home, family, presence, decisions — the French tax authorities can quite properly set this certificate aside and reassess you. It validates your Andorran status; it does not prove your departure from France. These are two separate demonstrations, and both must be made.
Until when can France revisit your departure?
The tax authorities' statute of limitations for reassessment of income tax runs until the end of the third year following the year for which the tax is due. This period is extended to ten years in the case of undeclared business activity or undisclosed assets held abroad.
One more point too many prospective movers underestimate: since 2018, Andorra has applied the automatic exchange of financial information under the OECD's CRS standard. Your Andorran accounts are therefore known to partner tax authorities. That is excellent news: it confirms Andorra is not an opaque jurisdiction, and that the whole approach is conducted in the open. It also means a weak file will, sooner or later, become visible.
Our rule: keep each annual file for at least four years, and ten years for sensitive tax years. A well-archived file can be defended in a matter of days; a scattered one takes months to defend, and rarely as well.
Key takeaways
- Andorran tax residency: more than 183 days or the centre of economic interests in Andorra
- A single criterion under Article 4 B of the CGI is enough for France to claim you
- The treaty's tie-breaker: permanent home, then vital interests, then habitual abode
- Article 25, §1(d): nationality clause never exercised to date
- The IFI remains due in France on French real estate above €1.3M
- Residence card (90 days) ≠ tax residency (183 days)
- The file is built continuously; statute of limitations for reassessment: 3 years, 10 years if undisclosed foreign assets
A well-prepared move to Andorra is anything but fragile: it is documented, consistent and fully defensible. We build this file with you from year one, then keep it maintained — because the best defence against an audit is a file already sitting ready the day it arrives.
Let's talk about your situation: we audit your plan, identify weak points, and set the timeline for your tax residency.
