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Trader in Andorra: the advantages of trading

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One of the standardized types of customer, Insiders, is the broker. For all those people who base their professional and / or business activity trading frequently whether acting as a "trader" with its own capital or as a "broker" with foreign capital, Andorra is a very attractive destination. The possibility of carrying out the activity of financial advisor and analyst and wealth manager regardless of physical location, enables many professionals in the sector move their residence to the Principality of Andorra.

These professionals find in Andorra a highly competitive jurisdiction from a tax point of view, an excellent internet connection throughout their territory and an environment of security and comfort, which enable their activity on the stock exchange to be carried out in a manner optimal, fast and at the highest performance and profitability. Next we will write the biggest advantages of trading in Andorra.

Stock market operations in Andorra in 2020. Trader, broker and financial analyst.

Tax advantages for the trader

Obviously the first advantage of trading in Andorra is the attractive taxation. If you still did not know the bases of Andorran taxation, you can visit our page on taxes in Andorra. Very relevant is the fact that Andorran personal income tax does not tax the capital gains generated by the purchase and sale of shares and exchange-traded funds. To be more precise, any capital gain generated by the sale of shares or participations, when the seller has not held more than 25% of participation in the entity, is completely exempt.

It is important to note that this exemption not only applies to the actual sale and purchase actually made, but to all activities through which a profit is obtained with listed shares, provided that the instrument used represents ownership of said shares. It is because of that, in certain cases cases are not considered and therefore the exemption does not apply. Access to this exemption will depend on the specific form, method or platform used to operate. We recommend resorting to professional advice for a better treatment of your particular situation and correct tax planning.

Thus, specifically for a trader or broker, who carry out low participation operations, equity transactions are usually tax exempt, fact that allows them to significantly increase their net financial profitability, and therefore, represents an unquestionable increase in their economic capacity. In Spain, this type of profit is taxed between 19% and 23%.

On the other hand, assets other than shares and investment funds are taxed at a maximum of 10% on capital gains, thus being very attractive. In addition, the fact that the exemption also applies to investment funds, allows the possibility of benefiting from it by investing in funds that in turn operate with the assets in which you want to invest. For example, although this exemption does not apply to earnings from fixed income operations, it does apply to investment funds that manage fixed income assets.

In addition to the planned exemption, for participations over 25%, a total exemption is also foreseen applicable on the gain derived from the sale of shares or participations, in any case, if the holding period has been greater than 10 years. 

Furthermore, the entry into force of Agreement to Avoid Double Taxation between Spain and Andorra, eliminates the possibility of Spain taxing profits of the natural persons resident in Andorra, when they derive from the sale and purchase of listed shares (in general, shares or participations in companies where they hold less than 25%, provided they are not companies whose main asset is made up of real estate located in Spain).

This second advantage applies to the capital gains of all the countries with which Andorra has signed a Double Taxation Agreement (CDI)There are currently eight and several in negotiations. However, for the other countries, although these earnings are exempt in Andorra, the countries of origin may apply taxes on said earnings even if the subject is resident in a foreign country.

Because we recommend studying it and doing international tax planning, with experts both nationally in Andorra and internationally such as the collaborators and associates of Andorra Insiders, who have already dealt with numerous similar cases. We optimize your taxation and taxes according to current legislation, in a safe and strict way.

State-of-the-art Internet connection

The fact that Andorra has 100% fiber optic coverage implemented in every household in the country is more than relevant for all those entrepreneurs who need a fast and secure internet connection. The case of a broker, financial analyst or other who does home trading is one of them. Andorra has been constantly improving its telecommunications technologies since 2012 to easily attract digital businesses, and is currently a world pioneer in this regard. We have more Andorra advantages here, as well as the transformation that the country has carried out in the last decade here.

Starting with a symmetric Internet rate of 300 Mbps at home for € 25 and with the possibility of reaching up to 1Gbps symmetric for business, in Andorra you will be able to be permanently connected. Also, the mobile network reaches 98% of the country's territory despite being in the middle of the Pyrenees, so that it could operate from anywhere in the country and at any time by hiring the internet on mobile. You can learn more about the Principality's telecommunications at the company's website, Andorra Telecom.

Es importante también asegurarse de que se opera mediante una plataforma de broker que permita tener una cuenta con residencia en Andorra. Por ejemplo, Interactive Brokers, Ameritrade, etc.

Physical and legal security

Andorra has traditionally been and throughout its history very outstanding for its war neutrality, its political, physical and legal stability and its pacifism. Staying neutral in all war conflicts has always been a priority of the country, which has more than seven centuries of peace. Not only that, but his no crime and criminality and its demilitarization they have always been exemplary for most countries in the world.

On the other hand, legal certainty is a principle recognized and protected by the Andorran Constitution  de1993, being thus guaranteed by its legal system and its institutions. Also, with the new reforms legal certainty has been reinforced of international investments in the Principality of Andorra with the liberalization of foreign investment and the negotiation of double taxation agreements.

Difference between trader and broker

Both a trader and a broker can fix their residence in Andorra, constituting a commercial company to develop their activity and obtaining a self-employment residence permit. However, the broker, acting on behalf of clients, must obtain an authorization from the Andorran Financial Authority (AFA), since its activity is an activity regulated and supervised by said authority. However, if the natural person carries out the trading activity with his own assets, he does not require any authorization. 

Andorra Insiders has already advised and established various similar trader and broker profiles in the Principality, and has the support of the best professionals in tax, commercial and regulatory law. Furthermore, the country is just now in a process of international economic opening that will bear fruit in the coming years. Do you want to take advantage of this situation and come now, or do it when the reforms have worked and it is too late? We have already made the decision, now is the time for yours. If yes, you can contact us here and tell us your case, you will receive personalized attention and information and comprehensive support.  

34 thoughts on “Trader en Andorra: las ventajas del trading”

  1. Hello,

    My name is Adrian,

    I would like to know how the fact of being a trader and operating with accounts funded by a company that is dedicated to it is taxed in andorra.

    I would also like to know if you guide traders to take the step of changing residence from Spain to Andorra.

    Thank you

    Reply
    • Hello Adrian.

      To answer your question, we would need some more information about your activity.
      Therefore, it would be better if you contacted us through our email, contact form or WhatsApp.

      Regarding whether we help traders to establish themselves in Andorra, of course. Like any other type of business that is feasible and attractive to carry out in Andorra. We have already dealt with many profiles of this type. In any case, it is better to treat it personally since each case has its peculiarities. You can contact us at contact@andorrainsiders.com same.

      Regards.

      Reply
  2. Hi.
    From what I understand, stock trading is not taxed, but CFD trading is.
    Spain is becoming impossible and I was considering going to Ireland, but being away from my parents so much makes me a little scared when they start to get older and need more help.

    Thank you. A greeting.

    Reply
    • Hi Hector, thanks for commenting.

      Indeed, contracts for difference, like most financial derivatives, do not imply ownership of the shares or representations thereof, which means that the exemption does not apply. In any case, the tax on income and capital gains is 10% with the first € 3,000 of income exempt, which is also quite attractive.

      Thanks to you and best regards!

      Reply
  3. Hello, so for a trader to apply for abitual residence, he does not need to form a commercial company, right? It's only for brokers, right?

    Reply
    • Hello david,

      No: both must form a commercial company if they only have that business model because it is the only way they have to justify their residence in the Principality of Andorra, except if the passive residence permit is obtained.

      In other words: although trading activities can be carried out as a natural person and with personal assets, in order to obtain a residence permit and self-employment in Andorra, it must be justified in this case through the participation and administration of a company. On the other hand, effectively, the broker activity can only be carried out through a collective investment vehicle and a legal entity.

      The fundamental difference between both activities is that broker activities, when managing third-party capital, must obtain a license from the Andorran Financial Authority (AFA), which controls and regulates these activities.

      I hope I have helped you, you can also contact us at contact@andorrainsiders.com.

      Thank you.

      Reply
  4. If you invest your money as a trader, is it necessary to create a company or can it be as a natural person?
    the benefits obtained as a natural person would be exempt from income taxes

    Reply
    • Hello Justo, thanks for commenting.
      As we mentioned to David, it can be done both as a natural person and through a partnership. Now, in order to obtain a residence permit and self-employment in Andorra, a company must be constituted, so if the only business model you have is trading, you must also create a company.

      I hope I have helped you, thank you very much.

      Reply
  5. Здравствуйте, думаю о переезде в Андорру, занимаюсь торговлей опционами. Какой налог на прирост капитала от опционных контрактов? Спасибо.

    Reply
    • Здравствуйте, прирост капитала и доход по опционным контрактам облагаются подоходным налогом в размере 10% для физических лиц, имея 3000 евро освобожденного дохода.

      Reply
  6. HELLO
    My question is, what tax treatment does the shares of companies listed on the Spanish market have in Andorra, which have been acquired, being resident in Spain and sold once residence in Andorra is obtained, how the capital gains obtained on the sale are taxed as well as the dividends obtained.
    Thank you

    Reply
    • Hello david,
      Well, it depends a bit on the specific case and its size, but in general, since you have sold as an Andorran resident, you have obtained the capital gains and returns as an Andorran resident, and therefore these income are taxed under the double taxation agreement between Spain and Andorra, which In the case of capital gains from shares LISTED on the stock market or if less than 25% of the total participation of a company not listed on the stock exchange is owned (usual case of trading), they are taxed exclusively in Andorra, either by personal income tax or by IS in case of legal persons.

      Reply
    • Hello Diego, all financial derivatives are taxed at 10% with € 3,000 exempt income. The exemption only applies to property or similar titles, assets that underlyingly represent ownership of shares and participations (that is, shares and funds). Thank you very much for commenting!

      Reply
  7. Olá! Gostaria de saber se a isenção também é devida para quem faz Day Trade e havendo tributação, qual seria?

    Reply
    • Olá, muito obrigado por comentar.

      A isenção não se aplica com base nos dias em que um ativo é detido, mas sim no tipo de ativo que é usado nas trocas. Assim, sempre que forem utilizadas cotas ou cotas de fundos, poderá ser aplicada a isenção. No entanto, os Daily Traders geralmente usam outras ferramentas diferentes, como CFDs, futuros e outros derivados financeiros aos quais não se aplica.

      Espero ter ajudado.

      Reply
  8. Hola! Vengo operando los últimos años con el broker Degiro y ahora que tengo la residencia en Andorra resulta que no es posible operar con Degiro desde aquí según me comentan desde el propio broker, ¿podría hacerlo con Interactive Brokers sin problemas? En caso afirmativo, ¿debería hacerlo con el IB con sede en Irlanda o desde el de Luxemburgo?
    Thank you.

    Reply
    • Hola, muchas gracias por comentar.

      Efectivamente, Interactive Brokers sí está operativo en Andorra, de hecho la mayoría de nuestros clientes de este sector operan a través de esta plataforma. Respecto a la ubicación del pagador, en términos generales es irrelevante, aunque según el caso puede ser interesante valorarlo en términos fiscales.

      Reply
  9. Hola Vivo en Sudamérica y mi mujer es Española, pensamos irnos a vivir allá, pero mi trabajo es de trader en la bolsa americana y europea. ¿Si constituyo una sociedad en Andorra y opero con esa sociedad los rendimientos por compra y venta de acciones no tributan verdad?
    ¿Pero si retiro anualmente utilidades de la empresa para mi gastos de vida en España, debo tributar en Andorra por esa utilidad y luego en España, Considerando que mi residencia personal esté en España y mi sociedad en Andorra?.
    Thank you
    Marco

    Reply
    • Hola Marco, muchas gracias por comentar.

      No, la exención solo aplica al IRPF, es decir, al impuesto de la renta sobre las personas físicas. En caso de constituir una sociedad y operar a través de ella, las rentas estarían sujetas al Impuesto de Sociedades, que no tiene exención en este sentido (tributarían al 10%). Eso sí, al percibir dividendos de la sociedad andorrana como residente andorrano, esas rentas están también exentas de pago por IRPF, con lo cual la tributación directa total sería igualmente del 10%. Por otro lado, no puede tener una sociedad en Andorra y residir en España, salgo que su negocio sea muy grande y pueda mantener una estructura jurídica considerable.

      Reply
  10. Hola buenas tardes, yo resido en andorra actualmente, con un permiso de residencia a 10 años y me interesa invertir en bolsa, que debo haacer previo a empezara a invertir y si me pueden aconsejar cual es la mejor forma o broker a utilizar. Estoy interesado en el mercado americano en las acciones y en el forex.
    un saludo gracias.

    Reply
  11. Hola Andorra Insiders,

    Let’s say I am a Resident of an EU country and want to relocate to Andorra to save taxes because I think taxation is theft and my country takes a lot of my money! I do not have a regular Job, i just live of my passive income, its called «privatier», i do not know if there is another term for it, basically someone who is rich enough to have the luxury of not working. I do not mean a pensioner or some pleabian who lives of state welfare.
    Lets say I have a liquid net worth of approximatly 5.000.000€, primarily invested into Stocks, mostly american, some chinese stocks which give me Dividends every few months and i can obtain my cost of livings through these Dividends. Another part of my more speculative portfolio are «certificates» (not an etf) on cryptos like this one XBT Provider Ether Tracker Euro – A2HDZ2 ISIN: SE0010296582, are these liable to taxation in Andorra, if so why the hell? If a Bitcoin ETF is launched this year, will a Crypto BTC ETF be subject to taxation? Sometimes I do a few trades an manage my portfolio, a maximum of about 10-15 trades per year. So nothing close to a day-trader. Just managing my private funds, nothing special, just like a lot of people do. If i relocate to Andorra as a passive resident, (no working) will I have to open a company just to manage my private wealth? It seems crazy to me. In the country I am located the bank/broker manages my tax, its a flat tax on Dividends and Winnings (when sold) which is automatically pulled off by the bank and delivered to the every hungry socialist state automatically. Do Andorran Banks also offer this service of doing the tax work automatically or do I have to file for a yearly taxation sheet in Andorra and list every trade I do myself? It seems to me that the Andorran government in its wish to comply is making it harder and harder for high networth individuals to relocate in Andorra. I get the feeling that socialism is making its way to Andorra, too. The only other option would be Monaco, but the cost of buying a small shoe box flat there is astronomical and would slash away some of my wealth that otherwise gives me dividends. It seems to me that Andorran politics is always finding more «arguments» to tax everything, what was not the case a few years ago, sadly. Another thing i find scary in Andorra are the taxes on crypto assets, even in my socialist hellhole of a country, they are exempt of capital gains taxation if they are held for at least one year, same with gold, valuable cars, watches etc.

    I do not understand why Andorra is making things that complicated, I bet if you would tax all capital gains at 0% including crypto and crypto trading you would be a serious haven in the world for all people who are tired of socialism and looking for some more freedom and a serious option besides Monaco, at least for people who want to stay in Europe. I can understand if the country of Andorra takes capital gains on real estate speculators, to prevent cost of living to go crazy for the locals, but everything else with capital gains tax is just extortion. Banks and Fiat will be a thing of the past if the crypto spaces developes on like this, it would be time for little countries to adapt and welcome the future instead of fighting it with regulations and obscure taxations, of course all in the name of security and saftey and anti money laundering, sure… Sadly Andorra does not seem to have good libertarian politicians like Marc Forné Molné anymore, who wanted the state to be small and prevent taxation of its inhabitants.

    My main question can I relocate to Andorra as non working «rich» and manage my protfolio without creating a company to do so, and can I pay 0% tax on dividends and winnings because I do not own more than 25% of the shares. Also will I be taxed on crypto «certificates» like the above mentioned Ethereum certificate held in my portfolio? And last but not least, will I be taxed on «physical» crypto if i hold it more than one year? The main «Open Sesame» to relocate to Andorra for a non working EU- Citizen is to invest minimum 400.000€ in real estate and 50.000€ in some Andorran government bond, is that right? Otherwise do i have to proof that i got enough money to not be a pleabian living on government cost? Will a Statement of my Bank/Broker with the amount of cash and stocks held on my name be enough/sufficient to proove that i am not a pleabian?

    I will end this rant on a quote of Ben Franklin, «Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety.»

    Thank you and greetings Torben

    Reply
  12. Kudos for this site! Will consider your service.

    Q1: Crypto trader pays the same taxes 10%? (assume that yes but re-checking)

    Q2: How income is being counted for taxes? By 1 January equivalent in Eur compare to a year ago? Or each trade result counts as profit/loss and summarized on the end of the year? Which part of crypto trading activity exactly is taxable? Is conversion from one crypto coin to another considered as profit or only when you sell your crypto to fiat (EUR or USD), or only that part is taxable which one withdraws to the Bank in Fiat currency (EUR or USD) on the Bank account?

    Q3: If company formation indicates services like analysis, consultancy, IT development, but the owner is also trading crypto from time to time (not the daily trades, but maybe once a month couple of trades) He can pay taxes from Company and personal taxes from trades both in Andorra only if he is a Tax resident in Andorra himself and not only his company, right? If so, the question is: Can passive residency give personal taxation in Andorra as well, or only Company will be taxed in Andorra but the personal income of the owner will be taxed not in Andorra?

    Q4: What is the minimum requirement for a person who gets an income in crypto trade to have his personal income to be taxed in Andorra.

    Q5: Is it obligation to register self-employment as crypto trader if you trade occasionally?

    Q6: Are there crypto-friendly Banks in Andorra? If not, which banks Andorra residents can use to withdraw money from crypto trading platforms to spend in Andorra?

    Reply
    • Hi, thank you for your questions and comment. Answering them:
      – Q1: Yes, although there is a crypto-specific law coming, right now, through a binding consultation, the public administrations have ruled that cryptocurrencies are listed as one more asset, that is, at 10% on capital gains and yields with 3,000 euros of exempt income (applied over personal incomes).
      – Q2: It’s the fiscal year that is counted, so you have to track all the operations of the year and offset profits and losses to apply the tax over the net gains.
      – Q3: Of course, one you are andorran resident, you could manage your own heritage and capital as you want, and that includes investing in crypto. You will pay 10% in concept of corporate tax over the incomes of your business and 10% with € 3.000 exempt over your crypto personal investment incomes. Corporations and individuals are two things apart and different. Your company is taxed where is it and you are taxed when you are, and both sites do not necessarily have to match.
      – Q4: As I sais, if those are personal incomes, € 3.000.
      – Q5: No, you are managing your own heritage and capital, that could not be considered as an economic activity.
      – Q6: Generally no, they aren’t. I mean, andorran banks are strict and seek to avoid the risks of money laundering and money laundering at all costs. In this sense, for them to correctly accept cryptocurrency capital, the traceability of the funds must be clear and transparent. If you trade through reputation platforms like Binance and Coinbase you will have no trouble.

      Reply
  13. Hola Andorra Insiders,

    estoy pensando en trasladarme a Andorra. Yo soy nutricionista, y tenia entendido que es una de las profesiones por las que podría estar exento de que me retengan 15000€ por entrar a Andorra. Pero aun así, también opero en acciones de la bolsa americana.

    Dicho esto, ¿Podría estar exento de los 15000€ por ser nutricionista y a la vez como he creado una sociedad para ello, poder operar en bolsa como persona física y así beneficiarme del 0% de tributación en compra-venta de acciones?

    Gracias de antemano por su respuesta

    Reply
    • Hola Jorge, muchas gracias por comentar. Como le comentamos en el correo, en primer lugar cuando se ejerce como profesional liberal no se crea ninguna sociedad, se ejerce como persona física. Como nutricionista es factible que rechacen la autorización del gobierno, pero se puede intentar.

      En segundo lugar, tanto en caso de ejercer como profesional liberal como constituyendo una sociedad, puede operar con su propio patrimonio como persona física como quiera, incluyendo la compra-venta de acciones que está exenta de tributación por IRPF andorrano. Hay que remarcar que solo aplica cuando las operaciones son realmente con acciones o participaciones en fondos de inversión colectiva regulados.

      Reply
  14. Hola Andorra insiders,

    Estoy planteándome un cambio de residencia a Andorra. Por un lado hago operaciones en bolsa con mi propio capital, por otro lado soy asalariado de una empresa española con teletrabajo indefinido por lo que puedo vivir donde quiera.

    Mi pregunta es, en este caso como podría hacerlo, necesitaría crear también una sociedad? Hay alguna incompatibilidad por ser una empresa española la que paga la nómina?

    Gracias, me parece que hacéis un buen trabajo.

    Reply
    • Hola Luis, muchas gracias por comentar.

      Efectivamente, para poder obtener la residencia andorrana deberá convertirse en profesional titulado en caso de poder hacerlo (estando a disposición de una formación como mínimo universitaria que permita ejercer con una profesión liberal bajo esta figura jurídica) o constituir una sociedad mediante inversión extranjera. De esa forma obtendría el permiso de residencia y trabajo por cuenta propia en Andorra. En cuanto a lo demás, la relación con su empresa debería dejar de ser puramente laboral y pasar a ser comercial, bien sea con usted como persona física o con su sociedad en el segundo caso.

      Intentamos hacerlo lo mejor posible 🙂

      Reply
  15. Hola, muchas gracias por toda la valiosa información que dáis.

    Si me dedico exclusivamente al trading de criptomonedas, sería posible formar alguna estructura que posibilitara la residencia pasiva? La verdad es que no me atrae mucho residir en Andorra más de 90 días al año.

    En esa misma línea, si pasara 5 meses al año en España en una casa propia, correría el riesgo de que España intentara tasarme? Sé que la regla oficial dice que si se está en España menos de 6 meses al año, en principio no tienes que pagar impuestos allí; sin embargo también he leído que si tienes propiedad en España, pueden usar eso como excusa para exprimirte, alegando que la propiedad + la estadía de 5 meses al año convierten a España en el verdadero país de residencia para ese año.

    Muchas gracias de antemano por su ayuda 🙂

    Reply
    • Hola Jaime, gracias por comentar.

      En primer lugar, debe saber que como residente pasivo puede gestionar su propio capital como persona física como quiera. Así pues, puede invertir en criptomonedas sin ningún problema.

      Respecto a la segunda pregunta sí, por supuesto, supone un riesgo. En principio y si se puede demostrar que efectivamente se ha pasado menos de 6 meses en España y más de 90 días en Andorra siendo residente pasivo andorrano es residente fiscal en Andorra. Sin embargo depende de estos dos puntos anteriores y por otro lado, si bien teóricamente se resolvería el caso a su favor el coste es peor en términos de tiempo y recursos.

      En conclusión: para residir en Andorra hay que establecerse y vivir en Andorra. Sin más. Buscar trucos supone exponerse a riesgos innecesarios de todo tipo. Lo recomendable para residentes pasivos es como mínimo pasar el año en tres países diferentes durante bastante tiempo, para que quede claro que la residencia fiscal corresponde a Andorra como residente pasivo.

      Reply

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