Taxes in Andorra 2026: how much you pay in income tax, IGI, corporation tax and property tax

Andorra has one of the lowest tax burdens in Europe without being a tax haven: it is a jurisdiction recognised by the OECD and the EU, with double taxation agreements and automatic exchange of banking information. In this guide, updated for 2026, you will find —with figures and examples— what you pay, and what you don't, in the Principality: personal income tax (IRPF), IGI (Andorra's equivalent of VAT), corporation tax, social security and, above all, every tax linked to property.

Moving from the UK? See the numbers in UK vs Andorra taxes 2026/27 and try our tax calculator.

Income tax in Andorra 2026: from 0% to 10%

Personal income tax (IRPF) has a single rate of 10%, but with a very high tax-free personal allowance and a tax credit that, in practice, creates three bands:

The tax-free allowance rises to €30,000 in the case of disability and up to €40,000 if your spouse or partner has no income from employment, business activities or property.

Examples: how much income tax you pay in Andorra

Simplified calculation without personal deductions, for a taxpayer with the general €24,000 allowance.

The most commonly used deductions

• Main residence: a deduction of 50% of the amount paid towards the purchase (including mortgage interest and capital repayments), up to a maximum of €5,000 a year. You must register as living at the property within 12 months of the purchase. The same deduction applies if you buy a home to let at an affordable rent.
• Family: €1,000 for each child under 25 and for each dependent relative over 65 (×1.5 in the case of disability), plus up to €300 towards each child's university fees.
• Pension plans: up to 30% of income from employment and business activities, with a maximum of €5,000.

Savings income, dividends and shares

• Savings income is taxed at 10%, with a tax-free allowance of €3,000 a year.
• Dividends from Andorran companies are exempt. Foreign dividends are taxed at 10%, with relief for double taxation.
• Gains on the sale of shares are exempt if your stake did not exceed 25% in the previous 12 months or if you had held them for 10 years or more (unless more than half of the company's assets are Andorran properties).

IGI: Andorra's "VAT", from 0% to 9.5%

The Impost General Indirecte (IGI) is Andorra's equivalent of VAT. Its standard rate is 4.5%, compared with 21% in Spain and 20% in France. These are all the rates in force in 2026:

The Govern (Andorran Government) has confirmed that the rates of IGI, income tax, corporation tax and ITP have not been changed in 2025 or 2026.

Corporation tax: 10%

The standard rate of corporation tax is 10%, one of the lowest in Europe. Since dividends paid by an Andorran company to a resident are exempt from income tax, the profits of a local company bear a total tax cost of just 10%. Andorran collective investment schemes are taxed at 0%. If you are thinking of starting a business, we explain it step by step in how to set up a company in Andorra.

Social security (CASS)

• Employees: 6.5% paid by the employee and 15.5% by the employer (22% in total).
• Self-employed: 22% on a base chosen as a percentage of the average salary. In 2026, contributions range from around €147/month (minimum base of 25%, common when starting out) to around €588/month (100% base).

What you do NOT pay in Andorra

• Wealth tax: does not exist.
• Inheritance and gift tax: does not exist.
• A council tax like Spain's IBI: does not exist. The comuns (parish councils) levy local charges of a very modest amount (see below).

Property taxes in Andorra

This is where taxation has changed most over the last two years, with Llei 5/2025 (known as the "Òmnibus" law) and Llei 2/2026 ("Òmnibus 2"). Here is the full picture, depending on the stage of the transaction.

When buying

• ITP exemption on a first main residence of up to €600,000, for resident buyers who meet the requirements of Llei 5/2025.
• Who pays the foreign investment tax? Non-residents, residents who cannot prove 3 years of effective residence in the last 10, foreign companies and Andorran companies with 50% or more foreign capital. Since 13 February 2026 the rates have doubled (they were previously 3% and 5%).
• If the home is let at an affordable rent as a main residence for 10 years, the foreign investment tax is reduced by 90%.

Every step of the purchase, including the prior authorisation and timescales, is covered in our guide on how to buy a house in Andorra.

While you own it

• Foc i lloc: an annual parish charge per registered resident (for example, €30 in Andorra la Vella and around €25 in Escaldes-Engordany in 2026).
• Parish property tax: calculated per m² of built area. In Andorra la Vella, for example, it ranges from €0.38 to €1.51/m² in 2026, with lower rates if it is your main residence and only property. A 100 m² flat pays in the region of €40 to €150 a year.
• Empty homes: since Llei 5/2025, a flat with no utilities or consumption for 18 months is considered empty. The Govern can bring it into use for affordable rental, and it is subject to a specific levy.

If you let it

• Resident landlord: rental income is taxed under income tax as part of the general base. You can deduct actual expenses or apply a flat-rate 40% expense allowance (if you request it before the year begins). If the rent is below €9/m² and €1,250/month, you get an additional 10% reduction on the income.
• Parish tax on rental income: 3% up to €40,000 and 4% above that. It can be deducted from income tax to avoid double taxation.
• Non-resident landlord: pays non-resident income tax at 10% on 80% of the gross rent (an effective 8%).
• Residential rentals are exempt from IGI.

When selling

The former property capital gains tax was abolished in 2024. Since then, the gain is taxed at 10% under income tax (or under corporation tax or non-resident income tax). For sales from 16 April 2025, the gain is reduced according to how many years you have owned the home:

• Surcharge on speculative sales: an extra 10% if you sell within 2 years and 5% if you sell between 2 and 5 years after buying.
• On completion, a payment on account of 10% of the gain is made. If the seller is a non-resident, the buyer withholds 5% of the price.
• Reinvestment relief: if you sell your main residence (owned for at least 4 years) and reinvest in another main residence in Andorra within one year, the gain is exempt. You must be Andorran or prove 5 years of legal residence.

If you are thinking of selling, you can get a free valuation of your home or see how we handle sales.

When are you tax resident in Andorra?

You are taxed in Andorra if you spend more than 183 days a year in the country or if the centre of your business activities or economic interests is here. It is also presumed if your spouse and minor children live in Andorra. Bear in mind: passive residency does not automatically make you tax resident, and the tax authorities of neighbouring countries scrutinise changes of residence closely. It needs to be done properly and with professional advice. We explain it all in our guide to residency in Andorra.

Frequently asked questions

How much income tax do you pay in Andorra in 2026?

Nothing up to a taxable base of €24,000, an effective 5% between €24,000 and €40,000, and 10% above €40,000. For example, on net income of €60,000 you pay around €2,800, an average rate of 4.7%.

What is the VAT rate in Andorra?

Andorra does not have VAT but IGI instead. Its standard rate is 4.5%, with rates of 0% (healthcare, education, residential rentals), 1% (food), 2.5% (transport and culture) and 9.5% (banking services).

Is there inheritance tax or wealth tax in Andorra?

No. Andorra has no wealth tax and no inheritance or gift tax.

What taxes do you pay when buying property in Andorra?

ITP at 4% on resale homes or IGI at 4.5% on new builds sold by a developer. If you are a foreign investor, you also pay the foreign property investment tax: 6% on the first home and 10% on any further ones since February 2026.

How much tax do you pay when selling a property in Andorra?

10% of the gain under income tax, with reductions after 6 years of ownership. After 10 years, no tax is due. If you sell within 5 years, there is a surcharge of 5% or 10%.

How many days do you need to live in Andorra to be tax resident?

More than 183 days a year, or having the main centre of your business activities or economic interests in Andorra.

Sources: Practical Guide to IRPF 2025, Govern d'Andorra (May 2026); report by the Economy Committee of the Consell General on Llei 2/2026 (January 2026); Andorra la Vella 2026 parish tax ordinance (Ordinació tributària comunal); CASS. For information only: this article does not constitute tax advice. Always discuss your situation with a qualified adviser.

Updated on 18/10/2026