Andorra

Advantages

- Favorable geographical position;

- Developed reliable bank system;

- Favorable tax regime – the rate of the corporate tax is 10 %;

- Andorra is situated in the zone of duty-free trade.

 

Legislation

 

Foreign Investment Law 2008;

 

The Corporations Act 1983;

 

Law of Companies 2007.

 

 

Taxation

Corporate tax is levied at 10% tax rate since the 1^st of April 2011.

VAT is levied at 4 %.

The rate of tax on dividends - 0 %.

Dividends paid by the Andorra company to its shareholders are taxed at 0% rate.

 

Forms of companies

Limited liability company Societat Limitada (SL)

 

Such a company is preferable for operating small or medium business. The directors of SL can be only individuals, residents or non-residents. For the director or company founder - non-residents, filing the special application for work permit in the territory of Andorra is necessary. One member is enough to found SL. Shareholders can be individuals or legal entities, residents and non-residents. The minimal number of shareholders is 2. The minimal authorized capital is €3.000 and should be completely paid up at the moment of registration. The name of the company should be in the Catalan language though in legislation there are not strict requirements for it. The company doesn't issue shares, authorized capital consists of parts. SL is obliged to have reserve fund which should consist of not less than 10 % of the annual income of the company and not less than 20 % of its authorized capital. Registered address is  compulsory to have.

 

Joint-stock company Societat Anònima (SA)

 

Such a company is preferable for operating large business. The director of SA can be only individual, resident or non-resident. If the director or company founder is non-resident, filing the special application for work permit in the territory of Andorra is necessary. One member is enough to found SA. Shareholders can be individuals or legal entities, residents and non-residents. The minimal number of shareholders is 2. The minimal authorized capital is €60.000 and should be completely paid up at the moment of registration. The name of the company should be in the Catalan language though in legislation there are not strict requirements for it. The company issues only registered shares. SA is obliged to have reserve fund which should consist of not less than 10 % of the annual income of the company and not less than 20 % of its authorized capital. Registered address is compulsory to have.

 

 

Currency Control

 

No currency control.

 

Accounts

Companies should submit accounts to the Government of Andorra annually. Fiscal year is equal to a calendar one: from the 1^st of  January to the 31^st of December.

 

Audit

Companies are obliged to have audit checks-up if:

- Annual actives of the company exceed €3.600.000;

- The company annual turnover exceeds €6 million;

- The number of workers exceeds 25 persons.

Any one of this specified condition is sufficient.

 

Confidential information

Information about shareholders and directors is public.

 

Permitted activities

There is a statutory requirement in Andorra according to which a foreigner can possess 100 % of shares only those companies which operate strictly certain kind of activity (there are about 200 kinds of such activities, they are fixed in Foreign Investment Law 2008). In all other cases if there is a foreign element in the company its share can't exceed 50 %.

 

Agreements on double taxation avoidance

No.

 

Agreements on information exchange

Andorra signed about 17 such documents with France, Spain, Portugal, Denmark, Sweden and so on.