TL;DR: Andorra active residency (residència amb activitat lucrativa) is for people who actually work in Andorra — by running a registered Andorran company or as a self-employed professional (compte propi). Unlike passive residency, it does not require a EUR 1,000,000 investment. The core financial requirement is a EUR 50,000 non-refundable contribution lodged with the Andorran Financial Authority (AFA), plus EUR 12,000 per dependent. You must hold ≥20% of the company and act as a director, register the business, affiliate to the CASS social security system (22% total contribution), and spend at least 183 days per year in the country to be tax resident. Corporate profits are taxed at a 10% flat rate (special regimes at 2%), and personal income (IRPF) at 0–10%. Self-employed authorizations are capped — Decret 75/2026 set the 2026 quota at 200 compte propi permits. Processing typically takes 2–4 months.
Key Facts: Andorra Active & Self-Employed Residency (2026)
| Item | 2026 figure | Legal basis |
|---|---|---|
| Minimum personal investment | None (no EUR 1M requirement) | Immigration framework |
| AFA deposit / state contribution | EUR 50,000 (non-refundable) | Llei 2/2026 (Òmnibus 2) |
| Additional contribution per dependent | EUR 12,000 each | Llei 2/2026 (Òmnibus 2) |
| Minimum shareholding (company route) | ≥ 20% + directorship | Immigration / company law |
| Corporate income tax (IS) | 10% flat (special regimes 2%) | Llei 95/2010 |
| Personal income tax (IRPF) | 0–10% (first EUR 24,000 exempt) | Llei 5/2014 |
| Indirect tax (IGI / VAT) | 4.5% | Llei 11/2012 |
| Social security (CASS) | 22% total (15.5% employer + 6.5% employee) | CASS regulation |
| Self-employed (compte propi) annual quota 2026 | 200 authorizations | Decret 75/2026 |
| General work & residence quota expansion | In force | Decret 101/2026 |
| Minimum physical presence (tax residency) | 183 days per year | Llei 5/2014 (183-day rule) |
| Wealth / inheritance / gift / exit tax | 0% | Andorran tax framework |
| Capital gains after 10 years’ holding | 0% | Andorran tax framework |
| Typical processing time | ~2–4 months | — |
What Is Andorra Active Residency?
Andorra active residency is a residence permit for people who carry out a genuine economic activity inside Andorra — either through an Andorran company they own and manage, or as a registered self-employed professional. It is the working counterpart to passive residency: where the passive route is built for investors and people living off passive income, the active route is built for entrepreneurs, founders, consultants and liberal professionals who want to base both themselves and their work in the Principality.
There are two main pathways. The company route involves incorporating (or acquiring a stake in) an Andorran company — typically a Societat Limitada (SL) — holding at least 20% of the shares, and serving as an active director. The self-employed route (compte propi) lets a qualified professional register an individual activity directly, without a company structure. Both lead to a residence-and-work authorization rather than a residence-only permit.
The practical attraction is straightforward. According to Llei 95/2010, Andorran corporate income tax (IS) is a 10% flat rate, with special regimes as low as 2% for qualifying activities. Personal income is taxed under Llei 5/2014 at 0–10%, with the first EUR 24,000 exempt. There is no wealth, inheritance, gift or exit tax, and IGI (the Andorran equivalent of VAT) sits at just 4.5% — among the lowest in Europe.
Who Qualifies for Active Residency in Andorra?
You qualify if you establish a real, substantive economic activity in Andorra and meet the company or self-employment conditions. The activity must be genuine — Andorran authorities expect actual operations, local substance and economic purpose, not a nameplate.
On the company route, you must incorporate or join an Andorran company, hold at least 20% of its share capital, and act as a director with real management responsibility. Foreign investors generally need prior foreign investment authorization before incorporating. On the self-employed route, you must demonstrate the professional qualifications relevant to your activity and register that activity in your own name.
In both cases applicants must affiliate to the CASS (Caixa Andorrana de Seguretat Social), provide a clean criminal record from their countries of residence, secure accommodation in Andorra (owned or rented), and pass a medical check carried out in Andorra. Unlike the passive route, there is no EUR 1,000,000 investment requirement — the active routes are designed around running a business, not parking capital.
How Much Does Andorra Active Residency Cost in 2026?
The defining cost is a EUR 50,000 non-refundable contribution lodged with the Andorran Financial Authority (AFA), plus EUR 12,000 for each dependent. According to Llei 2/2026 (Llei Òmnibus 2), this contribution is now definitive rather than a returnable deposit.
Beyond the AFA contribution, active residency carries running business costs rather than a large lump-sum investment: company incorporation and notary fees, minimum share capital for the SL, professional and accountancy fees, and ongoing CASS social security contributions. CASS is a 22% total charge — 15.5% on the employer side and 6.5% on the employee side — and self-employed members contribute on a regulated base. You should also budget for translations, apostilles, the medical examination, and private advisory fees. The trade-off versus passive residency is clear: lower capital entry, but real operating obligations and active management of an Andorran business.
Company Route vs Self-Employed Route: Which Should I Choose?
Choose the company route if you want a scalable structure, plan to hire, or expect to bill significant revenue; choose the self-employed route if you are a solo professional whose income is essentially your own labour. The company route gives you a 10% corporate layer (potentially 2% under special regimes), the ability to retain profits inside the SL, and a cleaner separation between business and personal liability. The self-employed route is faster and cheaper to set up but offers less structural flexibility.
The choice also interacts with the annual quota. According to Decret 75/2026, the 2026 quota for compte propi (self-employed) authorizations is 200 — a finite number that can run out during the year. Because of this cap, professionals leaning toward the self-employed route should confirm current availability before committing. The company route follows the separate general work-and-residence framework, which Decret 101/2026 expanded in March 2026.
How Long Does Andorra Active Residency Take?
Most active residency files complete in two to four months from a clean, complete application. The timeline runs through several stages: securing any required foreign-investment authorization, incorporating the company or registering the self-employed activity, lodging the EUR 50,000 AFA contribution, affiliating to CASS, completing the medical examination, and filing the residence-and-work application. Delays usually come from missing apostilles, incomplete criminal-record certificates, or the time needed to finalise incorporation rather than from the immigration decision itself.
How Does Tax Work Once You’re an Active Resident?
Once you spend at least 183 days per year in Andorra, you become an Andorran tax resident under the 183-day rule in Llei 5/2014, and your worldwide income falls under the Andorran system. Personal income is taxed on a 0–10% scale: the first EUR 24,000 is exempt, income up to EUR 40,000 is taxed at 5%, and income above EUR 40,000 at 10%. Your company’s profits are taxed separately at the 10% corporate rate (or 2% under a qualifying special regime).
Andorra layers strong long-term advantages on top of these low rates. There is no wealth tax, no inheritance tax, no gift tax and no exit tax. Capital gains on most assets fall to 0% after a 10-year holding period. And Andorra now has 21 active double taxation treaties (CDIs), reducing the risk of being taxed twice on cross-border income — an increasingly important factor for entrepreneurs with clients or assets abroad.
Frequently Asked Questions
Do I need EUR 1,000,000 for active residency?
No. The EUR 1,000,000 investment requirement applies to passive residency. Active and self-employed residency are built around running a business in Andorra, so they require no large qualifying investment — the main financial requirement is the EUR 50,000 non-refundable AFA contribution (plus EUR 12,000 per dependent).
What is the corporate tax rate in Andorra?
Andorra’s corporate income tax (IS) is a 10% flat rate under Llei 95/2010, with special regimes as low as 2% for qualifying activities. IGI (VAT) is 4.5%.
How much social security will I pay?
CASS contributions total 22% — split 15.5% employer and 6.5% employee. Self-employed members contribute on a regulated base set by CASS.
Is there a limit on how many self-employed permits are issued?
Yes. According to Decret 75/2026, the 2026 quota for self-employed (compte propi) authorizations is 200. Because the cap is finite, confirm availability before applying.
How many days do I need to spend in Andorra?
To be an Andorran tax resident you must spend at least 183 days per year in the country, per the 183-day rule in Llei 5/2014. Active residency assumes genuine, ongoing presence because you are running a business locally.
Can I bring my family?
Yes. Dependents can be included, with an additional EUR 12,000 contribution per dependent under Llei 2/2026. Spouses and children are covered under standard family-reunification rules.
Will my capital gains be taxed?
Most capital gains fall to 0% after a 10-year holding period. Shorter holdings and certain Andorran real-estate transactions follow specific rules — individual advice is recommended.
Sources
- BOPA — Butlletí Oficial del Principat d’Andorra: https://www.bopa.ad
- Llei 2/2026 (Llei Òmnibus 2): https://www.bopa.ad
- Llei 5/2014, de l’impost sobre la renda de les persones físiques (IRPF): https://www.portaljuridic.ad
- Llei 95/2010, de l’impost sobre societats (IS): https://www.portaljuridic.ad
- Llei 11/2012, de l’impost general indirecte (IGI): https://www.portaljuridic.ad
- Decret 75/2026 — quota anual d’autoritzacions de residència per compte propi (BOPA): https://www.bopa.ad
- Decret 101/2026 — ampliació de la quota general de residència i treball (BOPA): https://www.bopa.ad
- Govern d’Andorra — Immigració: https://www.govern.ad
- CASS — Caixa Andorrana de Seguretat Social: https://www.cass.ad
- Autoritat Financera Andorrana (AFA): https://www.afa.ad
Next Steps
If you plan to base both yourself and your business in Andorra, the right structure depends on your revenue profile, hiring plans and family situation.
[Calculate Your Tax Savings →] Use our Andorra Tax Savings Calculator to model your personal (0–10% IRPF) and corporate (10% IS) tax position against your current jurisdiction over five and ten-year horizons.
[Book a Free 30-Minute Consultation →] Speak with Josep Fusté Badana — ICLG Contributing Author on Andorran Private Client Laws and Regulations — about whether the company route or the self-employed route fits your plans, and how to secure a 2026 quota slot.
Author: Josep Fusté Badana — Senior Tax & Residency Advisor, Axior Global, SLU. ICLG Contributing Author — Private Client Laws and Regulations (Andorra). Licensed Tax Advisor — Principality of Andorra. Member, Andorran Association of Tax Advisors.
This article is for general information and does not constitute tax or legal advice. Residency and quota conditions change; individual advice is required before any application.