Residence permits in Andorra

Contributed by Andorra-Business , 27 November, 2013

General information

 If you are formally a resident in Andorra, you are not yet subject to any direct taxation. In simple terms this means that there is no income tax, no capital gains tax (except on Andorran property held for less than 10 years), no wealth tax and no inheritance tax.

On January 1st 2015 new tax regimes will come into force and a new Income Tax and Capital Gains Tax will apply. However, as you will see from the new taxation details at this does NOT mean that residents deriving their income abroad will be much affected, if at all.

Law on Foreign Immigration

The law on foreign immigration into Andorra dates from May 31 2012. It establishes two main ways in which you can come to live in Andorra.

Residence with Work Permit

These permits are issued in the first instance for 1 year, renewable 3 times for 2 years and after 7 years are renewable for 10 years. (In the case of French, Spanish and Portuguese nationals, they are issued with permits for 2 years in the first instance, which are then renewable for a further three years and thereafter for 10 years).

As before, preference is given to nationals of the EU/EEA and the issue of these permits is by quota (including sub-quotas for various occupations) established from time to time by the government, after taking into consideration the unemployment situation and various other factors.

Highly-specialised and professionally-qualified persons from other countries can be admitted to work in established businesses if the government deems it opportune. Similarly, the government can also allow in highly-qualified new-business investors under the provisions of Article 23.5 of the law which says 'Similarly, the Government....shall determine the convenience of allowing entry.... to foreigners.... whose residence in the Principality it considers of interest to the country as a result of the activities they develop, or as a result of their commitment to investing in Andorran assets, in order to satisfy the..... necessities of the economy and its society'.

In other words, now that commercial activity in the Principality is, in principle, completely open to foreigners the Government has full discretion to grant work permits to anyone whose newly-established business, in their considered view, will benefit Andorra. The buying of an existing business may also qualify in this respect.

Residence without Work Permit

This replaces the previous 'Passive Residence' Law (whilst protecting existing passive residents and preserving the existing conditions of residence for them). This type of permit is now split into three categories.

Précis of General Conditions for all three categories

Categories of permit

a). Residence Permit without paid activity

This is for people who have neither paid activity nor seek to work in Andorra. If, by virtue of the investment conditions below, they are directors or majority shareholders of an Andorran company or administer their own commercial property here, they can of course exercise control and direct these enterprises, but always with the proviso that this cannot not be in the form of paid employment.

To obtain a permit there are the following conditions:

The Principal Applicant (not dependents) must invest, in an effective and permanent form, a minimum of 400.000€ in Andorran assets. Permitted investments are:

The Principal Applicant must deposit a 50.000€ bond - and 10.000€ for each dependent - at the INAF. The bond does not earn interest, but may be deducted from the minimum 400.000€ above. The bond is designed to cover any debts that the applicant may incur with any administration or state-owned enterprise and is returnable when giving up the permit.

Applicants may apply for a permit straightaway, by signing a document stating that they will make the necessary investment within 6 months. Should they not be able to prove after 6 months that they have made the necessary investment, the permit will be automatically cancelled.

b). Residence Permit for Internationally-orientated Professional Persons.

To obtain the permit, there are the following conditions:

 c). Residence Permit for reasons of Scientific, Cultural or Sports interest.

To obtain the permit the following conditions apply:

Additional Information

All applicants must satisfy the Government that they have no criminal record in any jurisdiction which they have previously lived (not just for the current jurisdiction) and that they have no notifiable diseases (for which there is a simple medical examination). All certificates and documents proving civil status etc., must bear the apostille of the Hague Convention. This is called Legalisation of Documents for Use Abroad and is normally the province of the Foreign Ministry of the country involved. Where necessary, documents may have to be legally translated here in Andorra.

Tags: business | interest | Immigration | Investment | Tax | Work | Invest | unemployment | Immigration | Investment | Capital Gains | Finance | investment | Andorra | law | services | insurance | tax | inheritance tax |



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