Tax residency in Andorra for freelancers and self-employed people

Becoming an Andorran tax resident as a freelancer or self-employed person means going through active residency status, and setting up or running an Andorran company. Here are the current conditions, updated after the Òmnibus 2 law came into force in February 2026.

Active residency status: the conditions

• Effective physical residency of at least 183 days a year in Andorra.
• Set up, run, or hold an active stake in an Andorran company (as a genuinely involved director or shareholder, not a passive shareholder).
• Have housing in Andorra (rented or owned).
• Since 2026: a €50,000 deposit with the AFA (Andorran Financial Authority), now non-refundable — one of the most concrete changes under the Òmnibus 2 law for active-residency applicants.
• Stricter checks on genuine economic substance at renewal milestones (2 and 5 years), carried out jointly by the Ministry of Economy and immigration services — the stated aim being to limit “shell” companies set up solely to obtain a residence permit.
• A progressive language requirement: Catalan level A1 at the first renewal, A2 at the second (Llei 6/2024).

Some sources mention fast-track exemptions for the digital, innovation and high-tech sectors. The wording remains vague in publicly available documents: we cannot confirm the exact scope of these exemptions. If this point is decisive for your plans, ask an Andorran gestoria for written confirmation.

Setting up an Andorran company: the main steps

• SL (Societat Limitada): minimum capital of €3,000, of which 50% must be paid in at incorporation.
• SA (Societat Anònima): minimum capital of €60,000.
• A foreign national can hold 100% of the capital of an Andorran company, with no requirement for a local partner.
• A Foreign Investment Authorisation (AIE) is mandatory for any acquisition of more than 10% of the shares by a non-resident of Andorra. The file must include, among other things, a clean criminal record extract and a justification of the planned activity.
• Typical steps: reserving the company name with the Registre de Comerç i Indústria, obtaining a NIA (Andorran identification number), an electronic certificate, the AIE, then notarised incorporation and registration.

The overall timeline is often quoted as 10 to 14 weeks for a non-resident applicant, but this figure varies noticeably between sources — some firms quote shorter timelines. Treat this range with caution and ask the gestoria handling your case for a precise schedule.

Taxation once you’re an active resident

Personal income tax (IRPF)

• 0% up to €24,000 of annual income
• 5% from €24,000 to €40,000
• 10% above €40,000 (maximum marginal rate)
• The first €3,000 of savings/capital income is tax-exempt each year

Corporate tax (IS)

• Standard rate: 10%
• Reduced rate of 5% on profits up to €50,000, subject to conditions that vary by sector and company age — check the specifics with your gestoria for your activity
• Distributed dividends: 0% tax

IGI (Andorra’s equivalent of VAT)

• General rate: 4.5%
• Reduced rate of 1% (food, books) and super-reduced rate of 0% (health, education, social housing)
• Higher rate of 9.5% for banking and financial services

The absence of wealth tax and inheritance/gift tax in Andorra is widely repeated across tax guides, but we haven’t verified it directly against a government source: worth confirming if this point is decisive for your decision.

Active residency or digital nomad visa?

If you don’t want to set up an Andorran company and your clients/employers are all based abroad, the digital nomad visa (quota of 50 a year) can be a lighter alternative to full active residency.

What about the broader 2026 reform?

All the figures above already reflect the changes under the Òmnibus 2 law. To understand the full reform and its context, see our page Òmnibus 2 law (2026): what changes.