Andorra offers two main routes for high earners: passive residence (no work in Andorra, at least 90 days a year) and active residence (running your own Andorran company or working self-employed there). Personal income tax tops out at 10% and corporate tax is 10%. But Law 2/2026 made passive residence much dearer: the minimum investment rose from €600,000 to €1 million, and the deposit became a €50,000 non-refundable payment to the State. Buying property is also harder and more heavily taxed for newcomers.
Last checked: October 2026
In short:
- Passive residence now needs €1 million invested in Andorran assets (or €400,000 into the national Housing Fund), a €50,000 non-refundable payment plus €12,000 per dependant, and at least 90 days a year in Andorra.
- Active residence means owning more than 34% of an Andorran company and sitting on its board, with a €50,000 payment that Law 2/2026 made non-refundable, except for some high-value digital and innovation projects.
- Income tax is 10% with the first €24,000 exempt, corporate tax is 10%, and foreign buyers (including residents of under 3 years) pay a 6% or 10% tax on property purchases.
The two routes compared
| Passive (non-lucrative) residence | Active residence (self-employed with company) | |
|---|---|---|
| Who it suits | Investors and retirees living off capital | Founders, consultants, creators who will work from Andorra |
| Investment | €1,000,000 in Andorran assets, or €400,000 to the Housing Fund | Your company, set up with foreign investment authorisation |
| Payment to the State | €50,000 non-refundable, plus €12,000 per dependant | €50,000 non-refundable (some digital and innovation projects exempt) |
| Minimum presence | At least 90 days a year (residence commitment) | Main and effective residence in Andorra |
| Income requirement | 300% of the annual minimum wage, plus 100% per dependant | Business viability (plan or accounts) |
| Can you work? | Not in Andorra | Yes, through your company |
| Social security | Private health insurance | Registration with CASS |
Sources: Law 2/2026 as published in the BOPA, government application form T2 G024 (December 2025), form T2 G027 and form T2 G006.
Passive residence after Law 2/2026
The Consell General approved Law 2/2026 on 22 January 2026, and the text was published in the official gazette (BOPA) on 12 February 2026. It enters into force the day after publication. Its key changes for passive residence:
- Investment of at least €1 million in Andorran assets. Eligible assets include real estate, company shares, debt instruments, investment funds, government bonds, life insurance and unremunerated deposits, according to IMI Daily’s summary of the bill. Any property counted must be worth more than €800,000 per unit.
- Housing Fund alternative: €400,000 paid into the Housing Fund, a public mechanism for affordable housing.
- €50,000 non-refundable for the main applicant and €12,000 per dependant, transferred to the State once residence is authorised. Previously these were refundable, unremunerated deposits with the Andorran Financial Authority (AFA).
- Transitional rule: applications submitted before the law’s approval follow the old rules.
What changed, in numbers:
| Item | Before Law 2/2026 | Now |
|---|---|---|
| Minimum investment | €600,000 | €1,000,000 (or €400,000 to the Housing Fund) |
| Property counted | Any qualifying property | Over €800,000 per unit |
| Main applicant payment | €50,000 refundable deposit (December 2025 form); older adviser pages say €47,500 | €50,000 non-refundable |
| Per dependant | Refundable deposit | €12,000 non-refundable |
The October 2025 draft proposed €800,000 and a partly refundable deposit. The final law went further. If an adviser quotes €600,000 or a €47,500 deposit, the page is out of date.
Other passive conditions (government form T2 G024, December 2025): annual income of at least 300% of the annual minimum wage plus 100% per dependant, health insurance covering illness, disability and old age, a home in Andorra (owned or rented), and criminal record certificates. In the residence commitment form, you undertake to live in Andorra for at least 90 days per calendar year.
At the July 2026 minimum wage of €1,568.67 a month, the income test works out at roughly €56,500 a year for a single applicant (our calculation, assuming 12 monthly payments). The government raised the minimum wage by 2.8% from 1 July 2026, according to the Andorran news site Alto.
Active residence: running your own company
The active route for founders is “residence and work on your own account”. The government’s form T2 G027 sets out the core conditions:
- foreign investment authorisation to set up an Andorran company in which you hold more than 34%;
- a seat on the company’s board of administration;
- a €50,000 payment at application (Law 2/2026 makes it non-refundable, with an exemption for digital economy and innovation projects of high technological value);
- proof within 3 months that the company is incorporated and holds an active business licence;
- CV and qualifications, criminal record certificates, and proof of housing.
The government’s December 2025 form also describes a self-employed professional route where the activity is based in Andorra, you have at most one employee, and at least 85% of services are used outside Andorra. That form listed a €47,500 deposit plus €9,500 per dependant. We could not confirm whether Law 2/2026 changed these amounts; ask the Immigration Department before applying.
Active residents register with CASS, Andorra’s social security fund. Self-employed contributions are charged on a base set as a percentage (25% to 137.5%) of the previous year’s average monthly salary, chosen by your income. Under-35s in their first 24 months can contribute on 55% of the minimum wage. We could not confirm the contribution rate itself on the CASS pages we opened.
Taxes once you are resident
| Tax | Rate | Notes |
|---|---|---|
| Personal income tax (IRPF) | 10% | First €24,000 exempt (€40,000 if your spouse has no income) |
| Rebate on earned income | 50% of tax on general base above €24,000, capped at €800 | Works out at an effective 5% on the next €16,000 (our calculation) |
| Savings income | 10% | First €3,000 of savings income exempt |
| Capital gains on shares | 10%, or exempt | Exempt if you hold under 25%, or hold 25%+ for at least 10 years |
| Corporate income tax | 10% | |
| IGI (indirect tax) | 4.5% general; 9.5% financial services |
Sources: Law 5/2014 on personal income tax (Articles 5, 35, 37, 43, 46); Creand on current rates.
Tax residence is not the same as immigration residence. Under the income tax law, you are Andorran tax resident if you spend more than 183 days a year there or have your main base of activities or economic interests there. A passive resident spending 90 days and living elsewhere the rest of the year may still be tax resident in another country. See Tax residency explained: why the 183-day rule is a myth for most countries.
Andorra gives a credit for foreign tax paid on foreign income, limited to the Andorran tax on it. Gains on foreign property held for at least 10 years are exempt.
Property: the hardest part
Andorra has been tightening foreign property investment to protect housing for residents.
- Law 16/2023 imposed a temporary moratorium on foreign real estate investment, from late 2023 into early 2024, according to Andorra’s Department of Statistics. It has ended.
- Law 5/2025 (6 March 2025) brought residents of under 3 years into the foreign investment regime. The government has two months (extendable by one) to decide on an authorisation, and silence counts as a refusal.
- Law 2/2026 tightened this: residents who cannot prove 3 years of effective and permanent residence within the previous 10 years count as foreign investors. It also doubled the foreign real estate investment tax created by Law 3/2024:
| Foreign real estate purchase | Tax |
|---|---|
| One home (house, or one apartment with up to 3 parking spaces and 3 storage units) | 6% |
| Anything beyond that | 10% |
Demand has not collapsed. The Department of Statistics reports 843 authorised foreign property acquisitions in 2025, up 55.5% on 2024, worth €514.3 million. Spanish investors accounted for 38.3% of the value and French investors for 21.1%.
For most new arrivals, renting first is the practical route. Andorra’s inflation was 4.2% at the end of June 2026, and the government has announced a rental assistance programme for households spending more than 30% of income on rent, per Alto.
Andorra and the EU
Andorra is not in the EU. Its association agreement with the EU, negotiated alongside San Marino, is due to be signed in Brussels on 19 October 2026, the Government of Andorra has confirmed. European Parliament consent is expected around January 2027, followed by a referendum in Andorra and ratification by the Consell General. Head of Government Xavier Espot said the referendum would not be held this legislature if conditions are not met. Until it is ratified, nothing changes for residency or tax.
Related guides: Low-tax residency for high earners (2026): 14 regimes compared · Tax residency explained: why the 183-day rule is a myth for most countries · Tax-free countries (2026): no income tax countries you can actually live in · Italy flat tax for new residents (2026): lump-sum regime, cost, who it suits · Second passport (2026): how to get one by descent, residency or investment
Quick answers
Q: How much do you need to invest for passive residency in Andorra in 2026?
Under Law 2/2026, €1 million in Andorran assets, with any property counted worth more than €800,000 per unit, or €400,000 into the national Housing Fund. You also pay €50,000 non-refundable to the State, plus €12,000 per dependant, and need income of 300% of the annual minimum wage.
Q: How many days do I need to spend in Andorra?
Passive residents commit to living in Andorra at least 90 days per calendar year. That keeps the permit, but it may not make you tax resident. Andorra’s income tax law treats you as resident if you spend more than 183 days there or your main base of activities or economic interests is there.
Q: What is the tax rate in Andorra for a resident?
Personal income tax is 10%, with the first €24,000 exempt and a rebate that effectively halves tax on the next €16,000 of earned income. Corporate tax is 10%. Dividends from Andorran companies are exempt, and share gains are exempt if you hold under 25%.
Sources
- BOPA: Law 2/2026, of 22 January, on the continuity and consolidation of measures for sustainable growth (Consell General, 12 February 2026, PDF)
- Govern d’Andorra: residence authorisation application form T2 G024 (December 2025)
- Govern d’Andorra: self-employed residence and work application form T2 G027
- Govern d’Andorra: commitment of principal and effective residence, form T2 G006
- Consell General: Law 5/2014 on personal income tax (PDF)
- Departament d’Estadística: foreign investment note 2025 (PDF, via Altaveu)
- CASS: self-employed contributions leaflet (PDF)
- Creand: taxes in Andorra
- Crowe Andorra: living in Andorra
- Crowe Andorra: Law 5/2025 omnibus law
- IMI Daily: Andorra parliament approves bill reshaping passive residency thresholds
- Digital Andorra: passive residence investment proposal (October 2025)
- Altaveu: Government doubles foreign investment tax (October 2025)
- Alto: Andorra raises minimum wage to €1,568 (July 2026)
- Govern d’Andorra: the Andorra-EU association agreement will be signed on 19 October in Brussels
- Alto: Andorra to sign EU association agreement on 19 October (September 2026)
This is general information from the Nomad Forums team, not legal, tax or financial advice. Rules change; check the official source or a qualified adviser before acting.
Over to you: If you applied for Andorran residence before or after Law 2/2026, which route did you take and how long did approval take? And did you rent or buy, and what did the search look like?