Andorra Property Tax Guide: ITP 1.5-2%, IBI 0.1-0.5% 2026
Andorra's property tax system includes a transfer tax (ITP) of 1.5-2% on property purchases and an annual property tax (IBI) of 0.1-0.5% of cadastral value. There is no wealth tax and no inheritance/gift tax. Here is how Andorran property tax works in 2026.
Property taxation in Andorra is governed by local regulations and administered by the comuns (local parish councils) for IBI and the national government for ITP. Andorra's property costs are moderate compared to neighbouring countries. Spain imposes transfer tax of 6-10% and annual IBI of 0.4-1.1%. France imposes registration fees of 5-6% and annual taxe foncière of 0.5-1.5%. Capital gains on property sales →
Real-world example: A buyer purchases a residential property in Andorra la Vella valued at €500,000. Transfer tax (ITP) at 1.5% = €7,500. Annual IBI at 0.3% of cadastral value (~€300,000) = €900/year. In Spain, the same purchase would incur transfer tax of 6-10% = €30,000-€50,000 plus annual IBI of up to 1.1% of cadastral value. Rental income taxation →
Property Transfer Tax (ITP)
- Standard rate: 1.5% on the purchase price or cadastral value (whichever is higher)
- Increased rate: 2% for certain property types or transactions
- New properties: May be subject to IGI (4.5%) instead of ITP in certain cases
- First home: Potential reductions or deferrals for primary residences
The transfer tax is paid by the buyer at the time of registration. The tax is calculated on the higher of the contract price or the cadastral reference value. Notary and registration fees are additional.
Annual Property Tax (IBI)
- Rate: 0.1% to 0.5% of the cadastral value, set by each parish council (comú)
- Cadastral value: Determined by the government based on location, size, type, and condition of the property
- Frequency: Annual — billed by the local parish
- Variation: Rates vary by parish (Andorra la Vella, Escaldes-Engordany, Encamp, etc.)
- Rural land: Lower rates apply to agricultural and undeveloped land
The IBI is a relatively modest cost compared to other European countries. The cadastral value is typically lower than market value, so the effective tax rate on market value may be 0.05-0.2%.
Registration and Notary Fees
- Notary fee: Regulated fee based on property value, typically 0.3-0.5%
- Registration fee: Fee for registering the property title with the land registry
- Legal fees: Costs for lawyers to handle due diligence and contract preparation
Buyers should budget approximately 3-5% of the purchase price for total transaction costs including ITP, notary fees, and registration.
Do foreigners pay the same property tax as residents?
Yes. Andorra applies the same property tax rules to residents and non-residents. There are no additional surcharges or restrictions on foreign property ownership.
Is there a tax on rental income from property?
Yes. Rental income from property is subject to personal income tax at progressive PIT rates (0-10%). Deductions for maintenance, management fees, and mortgage interest may be available. Detailed rental income guide →