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Andorra Tax Residency Guide: 183-Day Rule, Territorial System, DTTs 2026

Andorra determines tax residency based primarily on the 183-day physical presence test. As a territorial tax system, Andorra generally taxes only Andorran-source income for residents, making it highly attractive. Andorra has double taxation treaties with over 10 countries to prevent dual residency. Here is how tax residency works in 2026.

Tax residency in Andorra is governed by the consolidated tax code and determines an individual's or company's tax obligations. The territorial system means that even tax residents are generally only taxed on income sourced within Andorra, with limited exceptions. The Ministeri de Finances — Departament de Tributs i Fronteres is responsible for determining residency status and issuing Certificates of Residency for treaty purposes. Personal income tax →

Real-world example: A digital nomad spends 200 days in Andorra and 165 days abroad. Since they exceed the 183-day threshold, they become an Andorran tax resident. However, under Andorra's territorial system, their foreign-source income (e.g., remote work for a US company) is generally not taxed in Andorra. If their home country also considers them resident, the applicable DTT is used to resolve dual residency via tie-breaker rules. Filing requirements for residents →

Individual Tax Residency Criteria

  • 183-day rule: An individual is resident if present in Andorra for 183 days or more in a calendar year
  • Permanent home: If an individual has a permanent home available in Andorra and their center of vital interests is in Andorra
  • Habitual abode: If no clear permanent home, the habitual abode test may apply
  • Principal center of activities: Where the individual's main business or professional activities are conducted

Andorran tax residents are generally taxed only on Andorran-source income (territorial system). Non-residents are taxed only on Andorran-source income as well. The tax year is the calendar year.

Corporate Tax Residency

  • Place of incorporation: A company is resident in Andorra if it is incorporated under Andorran law
  • Place of effective management: A company is also resident if its place of effective management is in Andorra
  • Permanent establishment: Non-resident companies with a PE in Andorra are taxed on PE-attributable income

Corporate residency determines CIT obligations. Resident companies are taxed on worldwide income (with participation exemption), while non-residents with a PE are taxed on Andorran-source income attributable to the PE.

Double Taxation Treaties

Andorra has concluded approximately 10 Double Taxation Treaties. Key treaty partners include:

  • EU/Europe: Spain, France, Portugal, Luxembourg, Malta, Cyprus, San Marino, Hungary, Netherlands
  • Middle East: United Arab Emirates (UAE)

Treaties generally follow the OECD Model Convention and provide for reduced withholding tax rates on dividends, interest, and royalties; elimination of double taxation; and mutual agreement procedures for dispute resolution. Andorra is expanding its treaty network.

Territorial Tax System Explained

Andorra operates a territorial tax system, meaning residents are generally taxed only on income generated within Andorra. This is a key difference from most European countries that tax worldwide income. Key features:

  • Employment income: Only income from work performed in Andorra is taxable. Remote work for foreign employers may not be taxable in Andorra
  • Business income: Only income from business activities conducted in Andorra is taxable
  • Passive income: Certain passive income (dividends, interest, royalties) from foreign sources may be subject to special rules
  • Capital gains: Gains on Andorran assets are taxable; gains on foreign assets generally are not

Certificate of Residency

A Certificate of Tax Residency can be obtained from the Departament de Tributs i Fronteres to prove Andorran tax residency for treaty purposes. The certificate is typically issued for a specific tax year and states that the individual or company is a resident of Andorra. The application requires: tax identification number, proof of physical presence (for individuals), and confirmation of tax filings. Processing time is typically 5-15 business days.

Can I be resident in Andorra and another country?

Yes, dual residency is possible. The applicable DTT's tie-breaker clause determines which country has primary taxing rights. The tie-breaker tests are applied in order: permanent home, center of vital interests, habitual abode, and nationality.

What happens if I spend less than 183 days in Andorra?

If you spend fewer than 183 days in Andorra and do not have a permanent home or center of vital interests there, you are generally a non-resident. You are taxed only on Andorran-source income.

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