Andorra residency

[FlipnShip]

I am in Andorra visiting for a bit. Rumours are that the requirements for Andorra passive residency will go up pretty soon from 400k euros to 700k euros investment.

Thanks for sharing that information. I am contemplating moving my residency to Andorra or Dubai. While Dubai on paper looks like a much easier option and makes financially more sense, the geographical location in combination with geopolitical and/or financial turmoil ahead is concerning. On the other hand living in small town in the Pyrenees such like good place to be in such a scenario. I have been to Dubai multiple times, unfortunately I have not made it to Andorra yet.

In an other thread you did mention that you have been a resident theire a couple of years ago. May I ask why you decided to relocate?

 

[orangekangaroo]

Thanks for sharing that information. I am contemplating moving my residency to Andorra or Dubai. While Dubai on paper looks like a much easier option and makes financially more sense, the geographical location in combination with geopolitical and/or financial turmoil ahead is concerning. On the other hand living in small town in the Pyrenees such like good place to be in such a scenario. I have been to Dubai multiple times, unfortunately I have not made it to Andorra yet.

In an other thread you did mention that you have been a resident theire a couple of years ago. May I ask why you decided to relocate?

After 10 years I wanted something different. Andorra has a close knit expat community, it is a great place for kids to grow up. If you love outdoor stuf like hiking, skiing, biking you will have plenty of fun.

It is great place to operate business from if you have substance outside Andorra. It is not so great to run or start an international business inside Andorra.

What has happened the last 3 years is that YouTubers and crypto guys have moved in plus a lot of other wealthy expats. There is not enough nice property for rent or to buy. Prices have gone through the roof. You need now 5k euro to rent a nice 4 bed house.

 

[FlipnShip]

After 10 years I wanted something different. Andorra has a close knit expat community, it is a great place for kids to grow up. If you love outdoor stuf like hiking, skiing, biking you will have plenty of fun.

It is great place to operate business from if you have substance outside Andorra. It is not so great to run or start an international business inside Andorra.

What has happened the last 3 years is that YouTubers and crypto guys have moved in plus a lot of other wealthy expats. There is not enough nice property for rent or to buy. Prices have gone through the roof. You need now 5k euro to rent a nice 4 bed house.

Wow 10 years that is a ton of experience. Thanks a lot for your detailed view about Andorra! Much appreciated! Unfotunately I could only find limited information on the net about Andorra.

The issues in regards of exploding property prices certainly make sense. Since I am not running a business, at least the other point would not apply. I am trying to get out of a high tax Eussr country, and since there is no tax on stock market gains and to my understanding only 10 % on future/cfd trading is sounds like an interesting option.

The stated outdoor possibilites certainly sound more appealing in the long run, than the Dubai lifestyle which to me is better suited for a couple of weeks max.

The biggest issues that I have with Andorra ia that it sounds like they are in line with C19 mandates smiliar to most Western countries. If that is thate case, that would be quite unfortunate.

Did you attain the Visa via opening a company there, if so how long did the whole set up take for you?

 

[orangekangaroo]

I went the passive residency route. It was a very cheap option 12 years ago. Now it is a 400k investment that is needed. Active residency with a company is a lot cheaper. It took me 3 to 4 months to get the residency.

 

[Jerry1911]

How was Andorra during Covid? Were QR codes mandatory for shopping centers for instance? What about courts/tax authorities/etc.?

 

[Barney2201]

For anyone on a non-EU passport who might be counting days in Europe on the 90/180 rule.... You can stop at the boarder and ask the Spanish to 'stamp you out' of Spain, just need to stop again on the way out of Andorra to get re-stampped back in. I did it a few weeks ago, bit of a strange experience but the boarder guards seemed quite used to it.

 

[Konstanz]

Another problem with Andorra is if you are used to lifestyle going to classy restaurants and bars, Andorra cannot offer such places.
The capital Andorra La Vella seems is a strange city with not much in it. Just cigarettes shops etc.
Quite difficult to access Andorra even in summer time... lots of driving through mountains.
I image many "passive" fake residents have their registration there. They just have their 700k-2m chalet or cottage and in reality spend most of time in some other locations in Europe.
Also they don't pay this 10%, because they are passive residents
Since Andorra does not have effective CFC , PE rules, so you can have BVI company. Receive money in it and all is tax free. Have a bank card in BVI company name and here you go - it's tax free.
You really don't have to stay in Andorra much time. For short time is nice nature gateway, with some nice "local taverns", winter skiing.
It's a good "registration" country because nobody can check how much time you spend in reality there because of lack of border control. Especially if you have EU passport.

Andorra is better location for have registration than Dubai. Because it's not a muslim sharia law country in middle east lol. In Dubai they have customs data and exact times dates when you enter / exit country.
Andorra is much more serious "residence"

 

[freegeek]

Another problem with Andorra is if you are used to lifestyle going to classy restaurants and bars, Andorra cannot offer such places.
The capital Andorra La Vella seems is a strange city with not much in it. Just cigarettes shops etc.
Quite difficult to access Andorra even in summer time... lots of driving through mountains.
I image many "passive" fake residents have their registration there. They just have their 700k-2m chalet or cottage and in reality spend most of time in some other locations in Europe....

I am contemplating my move from a high tax Western-European country to Andorra or Bulgaria. One of the downsides I noticed is that in my case if you are doing some kind of consulting business then Andorra still has a little bit of a "shady" business image which could be an issue. It is also not in EU which adds a bit to the problem. From a lifestyle perspective I would take Andorra but the more I think about it Bulgaria is probably the better option for me pure for business reasons.

 

[Konstanz]

I am contemplating my move from a high tax Western-European country to Andorra or Bulgaria. One of the downsides I noticed is that in my case if you are doing some kind of consulting business then Andorra still has a little bit of a "shady" business image which could be an issue. It is also not in EU which adds a bit to the problem. From a lifestyle perspective I would take Andorra but the more I think about it Bulgaria is probably the better option for me pure for business reasons.

I would not say Andorra sounds worse than Bulgaria business view.

 

[orangekangaroo]

How was Andorra during Covid? Were QR codes mandatory for shopping centers for instance? What about courts/tax authorities/etc.?

QR codes were mandatory, they follow basically Spain and France and don't want to step out of line. However, you could use a certificate from a friend and no one would check your ID. Courts are super slow, we had a house fire insurance claim that went to court and it took 5 years to get the payment I wanted. In the end, justice was served. You are foreigner and lawyers no how to delay and hope you will have left the country or agree to a pity settlement. Tax authorities are still in their infancy, they do not have the personnel to go deep into someone's tax affairs.

Another problem with Andorra is if you are used to lifestyle going to classy restaurants and bars, Andorra cannot offer such places.
The capital Andorra La Vella seems is a strange city with not much in it. Just cigarettes shops etc.
Quite difficult to access Andorra even in summer time... lots of driving through mountains.
I image many "passive" fake residents have their registration there. They just have their 700k-2m chalet or cottage and in reality spend most of time in some other locations in Europe.
Also they don't pay this 10%, because they are passive residents
Since Andorra does not have effective CFC , PE rules, so you can have BVI company. Receive money in it and all is tax free. Have a bank card in BVI company name and here you go - it's tax free.
You really don't have to stay in Andorra much time. For short time is nice nature gateway, with some nice "local taverns", winter skiing.
It's a good "registration" country because nobody can check how much time you spend in reality there because of lack of border control. Especially if you have EU passport.

Andorra is better location for have registration than Dubai. Because it's not a muslim sharia law country in middle east lol. In Dubai they have customs data and exact times dates when you enter / exit country.
Andorra is much more serious "residence"

I think you should revisit Andorra.

The restaurant scene has greatly improved over the years, due to the continued influx of expats.

Access to Andorra is easy from the Spanish side, with hardly any mountain roads, from the French side it is a different story, very windy.

The rules for Passive residents are that you have to stay a minimum of 90 days in Andorra, I would agree some passives would have a house in Andorra and live most of the time in Spain or France. Now the tax authorities of both Spain and France want you to prove that Andorra is your tax residency. I have friends that are now forced to stay in Andorra for 183 days so they can spend the rest in Spain.

Andorra banks are scared s**t of money laundering, especially after what happened with BPA. BVI companies, or complex corporate structures and you will find the banks very hard to cooperate with.

As a place of residence, it is great, 4 different school systems, safe country. You have to love the outdoors, winter sports and hiking otherwise it is not the country for you. As for the expat scene, it is the best I have found, it is close knit, very international and welcoming to new expats. I have never had such a rich, in sense of learning and experiencing, and fulfilling expat life. As for Andorrans they keep to themselves mainly.

Unfortunately, there is a serious lack of quality real estate for rent due to a big influx of wealthy expats which means you have to pay top prices.

 

[Konstanz]

you don't need Andorra bank account for BVI company. EMI works fine. There are also other ways. BVI was just an example

 

[orangekangaroo]

you don't need Andorra bank account for BVI company. EMI works fine. There are also other ways. BVI was just an example

Of course, you can have BVI, but do not expect to make a transfer for the 700K deposit for passive residency (yes this amount has been increased) or a house purchase to come from this account or an EMI.

 

[Konstanz]

Of course, you can have BVI, but do not expect to make a transfer for the 700K deposit for passive residency (yes this amount has been increased) or a house purchase to come from this account or an EMI.

I think you can make property purchase from EMI account if it's IBAN in your personal name. I don't believe there would be any problems. Andorra is interested to sell properties. The recipient (notary?) will see funds coming from personal account in the name of purchaser through SEPA. No problems with that
I understand your point about Andorra banks. However, it's a new reality now. It complicated to open bank account everywhere. But you can always bank in Switzerland etc..

 

[uncreative]

You will probably need a real bank account in Andorra before applying for the residency. A tax advisor told me that.

I dont really understand the point of passive residency. Where is exactly the advantage here?
Passive residences are certainly not accepted by other countries if a residence is triggered somewhere else.

I would rather choose the active residence, or pay taxes in Andorra with a passive residence, then you are on the safe side.

 

[Konstanz]

You will probably need a real bank account in Andorra before applying for the residency. A tax advisor told me that.

I dont really understand the point of passive residency. Where is exactly the advantage here?
Passive residences are certainly not accepted by other countries if a residence is triggered somewhere else.

I would rather choose the active residence, or pay taxes in Andorra with a passive residence, then you are on the safe side.

I don't really understand the point of Andorra when you can have Monaco with the same budget
Maybe only because you can have larger property with the same budget, but in Monaco you pay 0% tax and location is unbeatable.

 

[pomegranate]

I don't really understand the point of Andorra when you can have Monaco with the same budget
Maybe only because you can have larger property with the same budget, but in Monaco you pay 0% tax and location is unbeatable.

Andorra active residency is way cheaper than being in Monaco. Plus cost of living in Andorra is also much lower than in Monaco.
I would say: Monaco is really for UHNWI and billionaires. Andorra is more for HNWI.

 

[algotrader]

I don't really understand the point of Andorra when you can have Monaco with the same budget
Maybe only because you can have larger property with the same budget, but in Monaco you pay 0% tax and location is unbeatable.

https://www.numbeo.com/cost-of-livi...a&city2=Monaco&tracking=getDispatchComparisonMonaco is out of question for 99% of folks here.

Regarding the Andorra active vs. passive residency: I looked into that option because Andorra is especially attractive for equities traders with 0% tax but the problem with an active resicency and company setup is that there's a quota depending on the sector you're doing your business. And since many traders (espacially French traders) want to move there chances are high that I wouldn't have gotten permission to form a company there. Only solution left is passive residency. But if I had spent 350k for a property + 50k for worthless Andorra bonds I couldn't have used that money for my trading.
The language barrier is also a problem for those who don't speak Catalonian, Spanish or French. Only few Andorrans speak English.

 

[pomegranate]

And since many traders (espacially French traders) want to move there chances are high that I wouldn't have gotten permission to form a company there.

Can you elaborate on this point? Do you mean former French tax residents or passport holders? What about Spanish?

 

[orangekangaroo]

You will probably need a real bank account in Andorra before applying for the residency. A tax advisor told me that.

I dont really understand the point of passive residency. Where is exactly the advantage here?
Passive residences are certainly not accepted by other countries if a residence is triggered somewhere else.

I would rather choose the active residence, or pay taxes in Andorra with a passive residence, then you are on the safe side.

Passive residency is great in the sense that you only have to stay 90 days, which is not policed very strongly, with a renewal of your residency you have to pledge to stay 90 days or more. When you spend less than 183 days you are not a tax resident. Yes unlike what Konstanz wrote you do pay a 10% tax above 40K and above 50k for couples when you spend more than 183 days there. The beauty is that if you spend less than 183 you can still ask for a tax certificate which states that's that you owe nothing.

Active residency is a lot cheaper but you have to stay 183 days or more in Andorra, and you will get checked on this. You pay the 10% as well as social security contributions.

The benefits of both residencies are greatly reduced ski passes for the season and also greatly reduced gyms and swimming pools that are publicly run.

 

[Konstanz]

Passive residency is great in the sense that you only have to stay 90 days, which is not policed very strongly, with a renewal of your residency you have to pledge to stay 90 days or more. When you spend less than 183 days you are not a tax resident. Yes unlike what Konstanz wrote you do pay a 10% tax above 40K and above 50k for couples when you spend more than 183 days there. The beauty is that if you spend less than 183 you can still ask for a tax certificate which states that's that you owe nothing.

Active residency is a lot cheaper but you have to stay 183 days or more in Andorra, and you will get checked on this. You pay the 10% as well as social security contributions.

The benefits of both residencies are greatly reduced ski passes for the season and also greatly reduced gyms and swimming pools that are publicly run.

This is what I have told. Passive residence is good option if you plan to stay less than 183 days and you just want to have mountain Chalet. I don't think any passive residents pay this 10% tax if you can still get tax residence certificate and pay no tax.
Also the beauty is that it's really hard to check how long you stayed there because of lack of border control.