Andorra legal and accounting and tax considerations in 2024

1. Corporate tax in Andorra is levied at a 10% rate and must be i) filed within 6 months of the accounting year and ii) paid the following month. A reduced rate of 2% applies on income received from i) import/export and ii) and holding activities;
2. VAT in Andorra is charged at 4.5% on all goods and services;
3. Dividends and interest paid to nonresident businesses and individuals are exempt from tax;
4. Royalties paid to non-resident businesses are charged withholding tax at the rate of 5%. Technical services are also taxed, at a higher rate of 10%;
5. Foreign investors in Andorra must contribute social security on employees’ salaries at the rate of 14.5%;
6. There is no capital duty, no payroll tax, no stamp duty and no transfer tax in Andorra;
7. Businesses are allowed to carry forward their losses for up to 10 years;
8. Andorra has not yet signed double taxation avoidance treaties and is included into the blacklisted tax neutral jurisdictions’ lists of several countries including Spain, Canada, Italy, Sweden, Australia and Monaco;
9. Finally, Healy Consultants will assist the Client with i) Documenting and implementing accounting procedures ii) Implementing financial accounting software iii) Preparing financial accounting records and iv) preparing forecasts, budgets and performing sensitivity analysis.
10. In accordance with Andorra Foreign Direct Investment Law 2012, each entity must register for corporate tax and VAT at the Andorra Ministry of Finance. Healy Consultants will be happy to assist you with tax and VAT registration for a one time fee of €950;
11. As Andorra is not part of the EU, Healy Consultants will be happy to assist Andorran companies conducting business in Europe to register for EU VAT. Our one one-time fee for the same is €950;
12. For an active trading company, these accounting and tax fees are an estimate of Healy Consultants’ fees to efficiently and effectively discharge your annual company accounting, auditing and tax obligations. Following receipt of a set of draft accounting numbers from your company, Healy Consultants will more accurately advise accounting and tax fees;
13. In accordance with Andorra Foreign Direct Investment Law 2012, the issued share capital of €3,000 must be deposited to the company bank account before company formation. To optimize engagement efficiency and minimize delays, Healy Consultants is happy to deposit these funds on behalf of our clients;
14. Monthly, quarterly and mid-year Government tax obligations include i) payroll reporting and ii) monthly and quarterly VAT and corporation tax return filing. If you need our help, Healy Consultants can complete monthly Government reporting for a monthly fee of €1,600. Healy Consultants monthly support will include i) receive in dropbox the monthly invoices from our client ii) label monthly bank statement transactions iii) preparation and submission of VAT returns and iv) monitor monthly profit levels to minimize annual tax v) submission of monthly employee payroll reporting;
15. It is important our Clients’ are aware of their personal and corporate tax obligations in their country of residence and domicile; and they will fulfill those obligations annually. Let us know if you need Healy Consultants’ help to clarify your annual reporting obligations.