Last updated: May 2026

Limited liability companies (SL) in Andorra 2026: incorporation, minimum capital and taxation

Setting up a Limited Liability Company (SL) in Andorra costs €3,000 minimum capitalIt takes between 4 and 6 weeks and is taxed to Corporate Income Tax of 10% —compared to Spain's 25% or France's 33%. It's the most popular vehicle used by freelancers, entrepreneurs, and digital nomads relocating their business to the Principality. This guide explains exactly how to do it, what requirements the CCIS demands, and what actual costs you should budget for.

Why set up a limited liability company (SL) in Andorra?

Andorra combines four advantages that do not exist together in any other European country:

• IS al 10% on net profits (with a minimum effective rate of 15% under OECD Pillar 2 for large groups)
• IGI (VAT) at 4.5% —the lowest in Western Europe
• No wealth tax nor of inheritances between family partners
• Access to the European market via customs agreement and, soon, EU Association Agreement

For a self-employed person who invoices €200,000 annually with €80,000 in profit, the tax difference compared to Spain can exceed €10,000 annually —not counting contributions to the CASS, which are significantly lower than to the Spanish Social Security.

IS comparison by country: Andorra vs Europe

Country	IS Type	standard VAT	Dividend WHT	OECD Pillar 2 Minimum
Andorra	10%	4,5%	0%	15% (large groups)
Spain	25%	21%	19%	15%
France	25%	20%	30%	15%
Portugal	21%	23%	28%	15%
Ireland	12,5%	23%	25%	15%
Luxembourg	17%	17%	15%	15%

Pilar 2 OCDE: aplicable a grupos con ingresos consolidados > 750 M€. Las PYMES andorranas tributan al 10% efectivo sin restricción.

Legal requirements to set up a limited liability company (SL) in Andorra

Company type: Limited Liability Company (SRL)

In Andorra, the equivalent of the Spanish SL is the Limited Liability Company (SRL), regulada por la Llei 20/2007, del 18 d’octubre, de la societat limitada. Sus características principales:

• Limited liability to the capital contributed
• Minimum capital: €3,000 —fully disbursed at the time of incorporation
• Social participation (not shares) — they cannot be listed on the stock exchange
• Management body: sole administrator, joint administrator or board
• Registered office mandatory in Andorra

Real economic activity (substance)

Andorra demands real economic substance To access IS, dial 10%. This means:

• Genuine activity developed from Andorra (not a mailbox)
• At least one employee or administrator with active residence in Andorra
• Physical office or accredited coworking contract
• Management decisions made from the Principality

Without substance, the company may be reclassified by the tax authorities of the partner's country of residence as a "disguised permanent establishment" and taxed at origin.

Step-by-step incorporation process

1. Reservation of company name — CCIS (Cambra de Comerç, Indústria i Serveis d’Andorra): 50–100 €, 3–5 días hábiles
2. Opening of a notary bank account — MoraBanc, Creand o BancSabadell d’Andorra: depósito de 3.000 € de capital. El banco emite certificado de depósito.
3. Drafting of statutes — with a local lawyer or advisor. The bylaws define the corporate purpose, shares, and governing body.
4. Public deed before an Andorran notary — Notary fees: €400–€800 depending on the amount and complexity
5. Registration in the Registry of Companies — Ministry of Presidency, Economy and Business: €150–300, 10–15 business days
6. Registration with the Ministry of Finance (NRT) — Tax Registration Number: free, 5 business days
7. High CASS — if there are employees or salaried administrators: employer contribution ~15.5% of gross salary
8. Municipal business license — Parish council where the address is located: €200–600

Realistic total timeframe: 4–6 weeks if all documents are prepared (passports, NIE/NRT for foreign partners, apostilles).

Actual incorporation costs

Concept	Estimated cost
Minimum (recoverable) capital	3.000 €
CCIS fees + registration	€300–500
Notary	€400–800
Legal advisor / manager	€1,500–3,000
Business License	€200–600
Registered office (first year)	500–1,200 €
Total without capital	~3,000–6,000 €

Annual recurring costs—accounting, auditing if thresholds are exceeded, licensing, and registered office—range between €3,000 and €8,000 per year for a medium-sized company.

Taxation of the Andorran LLC

Corporation Tax (IS)

• General type: 10% on the taxable base
• Reduced type: 5% for technology startups during the first three years
• Dividend exemptionDividends received from subsidiaries (shareholding ≥ 5% for 12 months) are exempt if they are taxed at source at least at 4%
• Patent box: intellectual property income at 2% effective (80% reduction of taxable base)
• No withholding tax on dividends distributed to non-resident partners (withholding tax: 0%)

IGI (equivalent to VAT)

• General type: 4,5%
• Reduced rate (food, public transport): 1%
• Special rate (banking services, insurance): 2%
• Exports of services outside of Andorra may be exempt.

When does it make fiscal sense to set up an LLC?

The key question is not whether Andorra has lower taxes (yes, clearly), but if the savings justify the fixed costs of structure, residence and management. A rule of thumb:

• Beneficio neto < 50.000 € anuales: hardly profitable (fixed annual cost of €6,000–10,000 + accommodation)
• Net profit €50,000–150,000Clear breakeven; tax savings €7,500–€22,500 vs Spain
• Beneficio neto > 150.000 €Highly recommended; the difference grows exponentially

Important: the partner must also transfer your tax residence to Andorra (minimum 183 days/year) to avoid paying personal income tax in Spain on distributed dividends. Without a change of residence, the corporate advantage is neutralized.