Setting Up a Business in Andorra

An in-depth guide for foreign entrepreneurs and companies looking to enter the Andorran market — a Pyrenean jurisdiction that has genuinely modernized to attract content creators, e-commerce entrepreneurs, and traders, with a low-tax regime open to foreign company ownership.
This guide covers legal structures (SL/SLU, minimum €3,000 capital, mandatory foreign investment authorization), business taxation — including a 10% cap on both corporate and personal income tax, Europe’s lowest VAT equivalent (IGI) at 4.5%, and a real effective minimum rate of 3% since 2024 — company formation, the cost of labor, and immigration routes, including the distinction between active and passive residency and the tightened February 2026 passive residency threshold (€1 million, non-refundable AFA contribution). Includes a dedicated chapter on Andorra’s appeal for digital entrepreneurs, balanced against the genuine complications of being outside the EU for physical goods and financial passporting, an operational checklist, and useful contacts.
Available in English, Spanish, French, and Catalan.