IMPORTANT: This article was written in accordance with the corporate, tax, and foreign investment regulations in effect in Andorra at the time of its publication. Since the requirements for incorporating companies, foreign investment authorizations, registration fees, tax rates, and criteria regarding effective tax residency may have changed, any personal or business relocation to Andorra should be reviewed in light of current regulations and the specific circumstances of each case.
Incorporation of Companies in Andorra
Currently, we can observe—whether in the news or on social media (particularly in the world of content creators or high-level athletes)—a clear trend among companies or individuals to relocate to Andorra, seeking to invest capital or establish a company in that country. This is not only due to the clear tax advantages offered by the country (a maximum tax rate of 10 percent, unlike Spain where it can reach fifty percent), but also because, following the latest amendments to Andorra’s capital companies law and the entry into force of the foreign investment law, the procedures for establishing companies in Andorra have been greatly simplified, requiring not only less documentation but also eliminating requirements that, prior to the aforementioned amendments, were difficult to fulfill.
In relation to the above, the significant growth of commercial companies in Andorra—particularly those from Spain—is due to the fact that their structure and regulations are very similar, as they require practically the same requirements and form, which makes the transition or establishment of a company in that country very straightforward. This is combined with the barriers already mentioned in the previous paragraph, thus facilitating the incorporation process. However, the major difference lies in the tax burden, especially regarding corporate tax.
In addition to the above, we can highlight that in Andorra, information relating to the commercial registry is not as accessible as in Spain, where all information relating to companies is public in nature.
The facilities offered by the Principality of Andorra enable young entrepreneurs to relocate their companies to a country that appears to allow the development of their ideas. Numerous examples come to mind related to this case, such as the well-known “Gamers or YouTubers”—El Rubius, Auron Play, WillyRex, Vegetta, The Grefg, Patry Jordan, or Wall Street Wolverine, among others—who made the decision to relocate entirely to Andorra due to the taxation model established in the country. However, this situation should not be limited to the aforementioned cases; athletes, models, and many others have considered this option to benefit from a more transparent and simpler taxation system than Spain’s.
From this point forward, we will discuss in simple terms what is required for the incorporation of companies in Andorra and what important advantages the latest legal developments presented by the Government of Andorra have brought.
Requirements for Incorporating a Company in Andorra
Due to the significant amendment in 2012 with the entry into force of the new Foreign Investment Law, we will not need to be nationals or residents of Andorra; we will only require authorization issued by the Ministry of the Presidency, Economy, and Enterprise, which represents significant progress for those wishing to establish a company, as previously nationality or 20 years of residence in Andorra was required. For this authorization, and in order to prevent money laundering, it is necessary to have no criminal record (the corresponding certificate must be obtained) and a valid passport for each of the partners and directors. Both documents are required to be properly apostilled.
This authorization would be the first procedure to complete. Subsequently, the necessary documentation must be prepared to execute the deed and register the company. Therefore, we would need the reservation of the company name, the provisional business plan (describing the activity of the company to be established), the company’s bylaws (the content of which we will explain later), a written statement expressing the partners’ intention to create a limited liability company or corporation, identification of the partners, proof of the creation of a bank account in Andorra where the share capital will be deposited, and the shares and capital contributed by each partner.
What does a company’s articles of incorporation consist of?
In simple terms, these are the internal regulations governing the company, which have been created and approved by all the company’s partners. They must contain the following: the company name and registered office, the company’s purpose, how the shares or participations are divided (indicating their nominal value), how the company will be structured (i.e., which administrative bodies will compose the company, the number of directors, and their remuneration), and finally, the duration of the company.
What is the minimum amount of capital we must contribute to form a corporation and to form a limited liability company?
Regarding this matter, for Corporations, the partners must contribute a minimum share capital of €60,000 for its incorporation. For the incorporation of a Limited Liability Company, the minimum share capital to be contributed will be €3,000. Additionally, we must bear in mind that in addition to this share capital, each company incurs registration costs, which in both cases will average €1,016.17.
Does the company’s name have to meet any specific requirements?
For the granting of the Company Name Reservation application, it is necessary that the company name be original and not coincide with that of another company.
Is registration with a notary sufficient?
Until 2018, to apply for the incorporation of a company in the Principality of Andorra, it was a necessary requirement to obtain government authorization. However, with the Legislative Decree of December 5, 2018, this requirement is replaced by mere notarial authorization, whereby the notary is legally obligated to verify the authenticity of the submitted documents and, if everything is properly formalized, must report the incorporation to the registry within fifteen days.
Why is Andorra so noteworthy when it comes to its tax policy?
If we observe the significant differences in the amount we must pay to the Tax Authority between Spain and Andorra, we will be able to see why it is truly a profitable alternative to consider when establishing a company, as the following table we will present shows that in Andorra, for each of the taxes that concern us as a company, the maximum tax rate to be paid is 10 percent.
| Tax | Andorra | Spain |
| Corporate Tax | 5-10%, depending on income | 25% from zero euros |
| VAT/IG in Andorra | INCREASED RATE: 9.5% GENERAL RATE: 4.5% SPECIAL RATE: 2.5% REDUCED RATE: 1% | GENERAL RATE: 21% REDUCED RATE: 10% SUPER-REDUCED RATE: 4% |
| Personal Income Tax | €0-24,000: 0% €24,000-40,000: 5% Over €40,000: 10% | €0-12,450: 19% €12,450-20,200: 24% €20,200-35,200: 30% €35,200-60,000: 37% |
| Self-Employment Contribution | 10% applied to total income | Minimum contribution of €230 and from this, depending on monthly income, will increase up to a maximum of €542 |
As we have observed, the difference in taxation is enormous, causing companies or individuals who begin to receive high income to want to avoid the significant tax burden in Spain, where at some points they may end up paying half their income in taxes. For example, referring to self-employment contributions, to pay something similar in Andorra to what is paid in Spain, we would need to earn more than €6,000 monthly. However, by that point, we would already have been paying less than in Spain, although this is actually the tax where the least difference exists between the two countries.
Step-by-Step Guide to Incorporating a Company in Andorra
Following the last analysis, we will explain in simple terms the process for incorporating our desired company.
1. Application for Company Name Reservation.
2. Application for foreign investment authorization.
3. Opening of bank account and deposit of share capital.
4. Notarial deed recording the entire process.
5. Registration in the Andorran Companies Registry.
How can we help you?
IN DIEM Abogados has extensive experience and a high degree of specialization in International Law, offering advice and management of the documentation necessary for the incorporation and dissolution of companies abroad.
The specialized team in the International Area of In Diem Abogados will study your case regardless of where you wish to establish your company. Contact us; we are available 24 hours a day, any day of the week, without obligation.
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Preguntas frecuentes sobre crear una sociedad en Andorra
¿Por qué muchas empresas valoran crear una sociedad en Andorra?
Andorra puede resultar atractiva por su marco fiscal, su proximidad a España y la simplificación de determinados trámites societarios. No obstante, la decisión debe analizarse caso por caso, teniendo en cuenta la residencia fiscal efectiva, la actividad real y las obligaciones legales aplicables.
¿Es necesario ser residente en Andorra para constituir una sociedad?
No siempre es necesario ser residente para constituir una sociedad, pero pueden existir requisitos administrativos, autorizaciones o controles vinculados a la inversión extranjera. Conviene revisar la normativa vigente antes de iniciar el trámite.
¿Qué documentación suele requerirse para crear una empresa en Andorra?
Normalmente pueden solicitarse documentos de identificación de socios y administradores, certificados de antecedentes penales, pasaporte en vigor, reserva de denominación social, estatutos, plan de negocio, domicilio social y justificante de cuenta bancaria para el depósito del capital social.
¿Qué tipos de sociedades pueden constituirse en Andorra?
Las formas más habituales son la sociedad de responsabilidad limitada y la sociedad anónima. La elección depende del tipo de actividad, el volumen del proyecto, el número de socios, el capital disponible y las necesidades de organización interna.
¿Cuál es el capital mínimo para constituir una sociedad en Andorra?
Tradicionalmente, la sociedad limitada ha exigido un capital mínimo inferior al de la sociedad anónima. No obstante, las cuantías y requisitos deben comprobarse conforme a la normativa vigente antes de iniciar cualquier constitución societaria.
¿Qué son los estatutos de una sociedad?
Los estatutos son las normas internas que regulan el funcionamiento de la sociedad. Suelen incluir la denominación social, domicilio, objeto social, capital, participaciones o acciones, órganos de administración, duración y reglas básicas de funcionamiento.
¿Basta con firmar la constitución ante notario?
La intervención notarial es un paso esencial, pero no siempre agota todos los trámites. Puede ser necesario completar registros, verificaciones, autorizaciones, obligaciones fiscales o trámites administrativos adicionales según la actividad y la estructura elegida.
¿Crear una sociedad en Andorra garantiza pagar menos impuestos?
No necesariamente. La fiscalidad depende de la residencia efectiva, la sustancia económica, el lugar real de dirección, la actividad desarrollada y la relación con otros países. Una planificación incorrecta puede generar conflictos con la Administración tributaria española o andorrana.
¿Qué riesgos existen al trasladar una empresa de España a Andorra?
Entre los principales riesgos están una incorrecta determinación de la residencia fiscal, falta de sustancia real en Andorra, problemas de doble imposición, incumplimientos societarios, errores en la documentación y posibles comprobaciones tributarias en España.
¿Cómo puede ayudar IN DIEM Abogados en la creación de una sociedad en Andorra?
IN DIEM Abogados puede analizar la viabilidad jurídica y fiscal del proyecto, coordinar el asesoramiento internacional, revisar la estructura societaria, preparar documentación, valorar riesgos de residencia fiscal y acompañar en el proceso de constitución o traslado empresarial.
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Furthermore, IN DIEM Abogados has extensive experience and a high degree of specialization in International Law, offering advice and management of the documentation necessary for the incorporation and dissolution of companies abroad.
Our International Area offers anticipation capacity, legal advice, and consultancy for companies and individuals wishing to expand their businesses and enter the international market. Therefore, our activity focuses both on foreign clients who wish to receive advice on business and matters in Spain, and on Spanish nationals with interests in other countries. For this purpose, we have a network of law firms with which we coordinate operations, including a significant part of the American Continent, Asia-Pacific, and Europe.
Abogados IN DIEM has a team with experience in roles such as magistrate, state attorney, prosecutor, and university professor, which will give you peace of mind and confidence, knowing you have the best team—one that is competitive and highly qualified to achieve your goals and meet your needs.
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