Opening a business in Andorra

Why open a company in Andorra?

Low taxation

The taxes maximum totals paid in Andorra never usually reach 10% of the rent, regardless of their type and origin

Connection

With a 100% fiber optic coverage and mobile 98%, and a future habilitation of two airports and a heliport

Location

Located in the Pyrenees between France and Spain, Andorra is close to all of Europe, and especially close to Barcelona and Tolouse

Covenants

The Principality has bilateral agreements with many countries, highlighting among them the 8 double taxation agreements (CDI)

Low quotes

Social Security competent, reliable and solvent, and one of the best sanitary systems in the world

Tax advantages of doing business in Andorra

Process to create the company

1. Application for company name

We will request the Andorran Government the name that the company to be incorporated will have, and the authorization of foreign investment is requested

3. Bank account and share capital

It is about opening a bank account of a company in constitution after compliance and KYC and depositing the share capital in it.

5. Registration in the Companies Registry

The notary has 20 days to register the company after signing and incorporation

7. NRT and Registry of Commerce and Industry

We present the application for Commerce to be able to carry out the commercial activity, and we obtain the NRT

2. Request for foreign investment

The Andorran government is requested to authorize foreign investment when the client / s have a participation of more than 10% of the share capital.

4. Public deed and signature before a notary

Drafting of the company's public deed and constitution process before a notary

6. Deposit in the AFA

We deposit the € 15,000 deposit in the corresponding organization and obtain the residence permit on your own account

8. Registration in the CASS and other procedures

Finally we register the company (and people) in Andorran social security and carry out specific procedures for each society

Done, your company already operates normally

Legal forms of companies in Andorra

  • Minimum share capital of € 3,000
  • Small and medium businesses
  • Minimum share capital of € 60,000
  •  Large platforms and companies

Trade Requirements

  • Tradename
  • Local of at least 20m2
  • Electrical installation
  • Fire extinguisher installation and maintenance

Required documentation

  • Criminal record and valid passport
  • Business plan and investment strategy
  • (*) For the business plan and strategy we provide all the necessary help for compliance

Requirements to maintain the business and substance

  • Registered office in Andorra
  • Administrator or resident employee.
  • Prepare quarterly and annual tax returns 
  • Pay municipal taxes (€ 800 per year approx.)
  • Actual activity with operations and transactions
  • At least one physical office (or local) employee
  • Manage operations and decisions from Andorra
  • Commercial premises: office, home, offices, etc. (from € 400 per month approx.)

Substance factor in international business

  • Physical and registered office (not just postal address)
  • Administrative meetings within the Principality
  • Principal active bank account in Andorra
  • Accounting and accounts management in the country
  • Usual operating expenses in Andorra
Opening a company in Andorra, requirements,

What is this about economic substance?

In 2013, the Organization for Economic Cooperation and Development (OECD) sought to combat tax avoidance practices at the international level. Specifically reduce if not eliminate the Base Erosion and Profit Shifting or BEPS for its acronym in English. With this term it designates the tax planning strategies used by multinational companies to take advantage of discrepancies, gaps, unwanted mechanisms and inconsistencies in national tax systems and transfer their benefits to countries with little or no taxation.

For this they launched the bEPS project at the international level and a report with 15 actions to be taken to combat this problem, seeking to reduce tax fraud. As well, one of the measures of this project it is precisely "improving the coherence of international tax standards, reinforcing its focus on economic substance and guaranteeing a more transparent fiscal environment", thus making the concept of substance a requirement to operate an international business.

Approximate times and costs

Costs and administrative fees: € 2,000-2,500 approx.

Agency fees: from approx. € 4,000, on request.

Estimated time: between 2 and 3 months

Frequent questions

❓How much does it cost in money and time to start a company in Andorra?

Although of course it depends on the specific business, opening a company in Andorra usually costs about € 4,000 in fees + € 2,600 in fees and costs + the share capital (€ 3,000 or € 60,000 minimum).

❓Is it possible to create a company in Andorra and reside in Spain?

It is totally viable and legal. The company would pay taxes in Andorra, and the businessman would be subject to Spanish regulations by maintaining his tax residence in Spain, without benefiting from the Andorran tax advantages.

❓How much does a company pay in Andorra?

In general, 10% on net benefits and approximately <€ 1,000 per year for maintenance. Dividends extracted are also exempt from Andorran personal income tax.

❓What are the requirements for international business?

In general, demonstrate that the main activity is carried out: main bank account, accounting management, administrative meetings, registered offices, etc.