Andorra's fiscal system in 2022
The most advantageous fiscal system in Europe
Whatever European country you may come from, Andorra’s fiscality will allow you to save up an enormous percentage of your fiscal burden.
Free from many of the problems that plague several European countries, such as very high tax policies, insecurity and the restriction of individual rights. Andorra is a unique country in a unique position.
Seeing those misdeeds, Andorra is a country that seized the opportunity to give an alternative.
Andorra is THE alternative to tax hells.
— The
team.
Andorra's taxes
Andorra’s taxes, as you will soon see, are more than just advantageous, whether from the perspective of an investor, entrepreneur or employee.
Andorra’s fiscal system has the lowest VAT in Europe, the lowest corporate tax in Europe, the lowest income tax (especially for high earners) and a Social Security tax among the lowest in Europe.
On this page you will be able to check out a simple comparison between the United Kingdom’s tax system and Andorra’s.
You will also discover a calculator with which you can estimate the capital you would save up under Andorra’s tax system.
Corporate tax
United Kingdom
Andorre
The tax rate is lowered to 2% for holding companies whose activity consists of foreign investments.
This liberating corporate tax allows you to easily reinvest in your company or venture, particularly if you manage a holding company.
Maximal income bracket tax (IRPF)
United Kingdom
Andorre
The first tax bracket, 0 to 24,000€ is 0%.
The second tax bracket, 24,001€ to 40,000€ is 5%.
The last tax bracket is 40,001€+ which is 10%.
Ce système permet à ceux qui ne gagnent pas beaucoup d’être complétement exemptés de ce que l’on appelle l’Impost sobre la Renda de les Persones Físiques (IRPF), ainsi qu’aux plus gagnants de conserver leur patrimoine, en contribuant une portion que l’Administration considère juste.
Il faut garder en tête que les couples mariés tributent différement: de manière plus avantageuse.
Value Added Tax (IVA)
United Kingdom
Andorre
4.5% is the general tax, other categories of V.A.T exist in Andorra:
1% for books and food.
2.5% for works of art.
9.5% for banking and financial services.
This general 4.5% VAT tax is the lowest in Europe.
Maximal capital gains tax
France
Andorre
If you own less than 25% of the company whose shares you are selling, the tax is 0%.
Otherwise the maximal income tax bracket applies, which is 10%.
It is hard to do better than 0% tax, especially when the conditions required to apply it apply to most small investors.
Dividends from Andorran companies are also exempt from capital gains tax.
Estate, Inheritance & gift tax
United Kingdom
Andorre*
Andorra does not have inheritance tax, real estate tax or donation/gift tax.
Once again it is hard to top 0%.
Andorra operates on a very simple paradigm: the capital within an inheritance, the capital required to own real estate and the capital required to donate or gift is by definition already taxed, whether directly through income and corporate tax or indirectly through VAT. Therefore, this money is considered free of any further tax.
Social Security Tax
Andorre*
United Kingdom
As an employer, 15.5% is the amount you pay.
The employee has to pay an extra 6.5%, for a total of 22%.
The UK has the second lowest Social Security tax, just behind Ireland. Andorra is third. It is indeed the only situation in which the UK’s tax system is better than Andorra’s.
In either case, this low social security tax allows you to hire much more easily than in other European countries, scaling your business quickly and responsively as needed.
More reasons to move to andorra
Curious to know how other European countries compare to Andorra ? Also, how safe is Andorra ? Check it out by clicking the button below.
