Located in the Pyrenees between Spain and France, Andorra can be a strategic place to register a company.
The headline corporate-tax rate and IGI can be attractive, but your actual costs, activity, banking and residence requirements matter more than an old investment-growth statistic.
Crucially, Andorra has also changed its policies regarding company ownership. As an expat you’re able to own 100% of your company without the need for Andorran nationals to own a share, be a director, secretary or otherwise.
As with all countries and entities, there are some catches however.
In this guide, I’ll walk you through everything you need to know about setting up a company and doing business in Andorra.
Advantages of Starting a Business in Andorra
There are a host of benefits to doing business in Andorra:
- With its close proximity to major cities, Andorra isn’t wildly inconvenient to get to if you need shareholders or stakeholders to visit and sign documents.
- This same proximity is helpful if you’re using Andorra as your logistics base to pick, pack and send products from.
- Andorra’s general corporate income-tax rate is 10%, with specific rules for reliefs and particular income or transactions. Compare the full calculation, including other business costs, rather than treating that headline as a universal ceiling on every charge.
- Office space rental costs are generally lower than in France or Spain (though this is changing).
- Banks in Andorra are now part of the Single Euro Payments Area (SEPA), meaning payments are much faster than they used to be.
- Andorra has an extensive fibre network, which is useful for an online business. Confirm the actual connection, plan and any backup you need at the premises before signing a lease. Current home-internet plans.
- Your company gets to leverage Andorra’s political and economic stability.
- If you’re considering moving to Andorra, forming a company enables you to become an active or passive resident.
- Andorra is keen to promote innovation and research, and works to support local companies.
- Electricity tariffs depend on your connection and usage. Use FEDA’s 2026 tariffs and the premises’ past bills rather than an unsupported Europe-wide price ranking.
- Reporting requirements are not arduous.
- Compare written payment-processing quotes for your transaction types, currencies and customer locations; an old headline percentage is not a current tariff.
Practical Considerations
- Changes to the company purpose, shareholders and more often require a visit to the notary. This means you need to visit the country in-person to get things done.
- Some procedures can be completed online, while others require original documents or an in-person appointment.
- Ask your bank for a full schedule of fees and discuss which account services best suit your business.
- Check whether your preferred accounting software can connect to your chosen bank and payment services.
- Payment providers apply country, company and owner-residence eligibility rules. Check Stripe’s supported countries and your chosen provider’s current terms. Do not assume a payment account held elsewhere can be used as a workaround for an ineligible local company.
- When discussing the online business models that many of us use day to day, it helps to explain clearly how the business operates.
- A clear description of your activities and source of funds can help the bank assess your application.
- I’ve found that most banks understand what I do when I just tell them I’m a “freelance SEO consultant“—they understand the consulting business model well, so this is what I use my local company for.
Corporate Entities in Andorra
The first step is deciding on the type of corporate structure suits your needs.
Which one you go with will depend on the size of the company you plan on starting and how much liability you want to bear as an owner.
The different types of Andorran company registrations include:
- Societat Limitada (SL)
- Equivalent to an limited liability company.
- Best for small businesses.
- At least 2 shareholders are required.
- The most common entity used.
- Paid in-capital required: €3,000.
- Societat Limitada Unipersonal (SLU)
- Same as the SL above, but for individual owners.
- Only 1 shareholder required.
- Paid in-capital required: €3,000.
- Societat Anónima (SA)
- Equivalent to a public limited company.
- For large businesses with many shareholders.
- Increased privacy for shareholders.
- Paid in-capital required €60,000.
- Other Options
- Sole proprietorship
- General partnership (Societat col·lectiva)
- Both of these do not limit liability, and are therefore not suited to the needs of most business owners.
Andorran Company Formation Process
Once you have decided on the type of company you want to form, the process to register your business is fairly straightforward.
Allow time to gather the documents and complete each stage, especially if you are managing the application yourself.
Let’s take a look at the steps involved.
Foreign Investment Authorisation
If company formation is part of an application for self-employed residence, start with the required residence-authorisation reservation. Then follow the foreign-investment and company-formation sequence. The official procedure distinguishes the company and regulated-professional routes.
Non-resident partners and shareholders with a larger than 10% stake in the business require foreign investment authorisation, which can take up to four weeks.
Registering the Company Name
The main thing to keep in mind when choosing a name is that there should be no risk of it being confused with one that’s already registered. While it doesn’t have to be in Catalan, it must be in a language that uses the Latin alphabet.
The government’s company-formation procedure asks for three proposed names and the intended activity. A name approval is only one stage; it is not a promise that banking, investment authorisation and incorporation will all finish within ten days. Official formation sequence.
Incorporation of Your New Company
The next step requires you to put together an in-depth and well researched business plan (including financial forecasts) and submit it along with the following:
- Authorisation for the name
- Articles of association of the company
- This portion of the process will require a visit to the notary
- These articles will be in Catalan and will specify how you run the company
- Proof of an Andorran bank account that contains the required capital amount
- Proof of ID for all directors (legalised in Andorra or apostilled)
- Criminal record checks for all directors (also with apostille)
Note: documents must not be older than three months.
Trade Register Entry
The penultimate step in the process is to have your company registered in the Registre de Societats Mercantils (Andorran company register).
Once your company has been added to the company register, you have six months to start trading.
Register With Your Local Government
Your company not only needs to be registered with the Govern d’Andorra, but also your local commune.
Processing times vary by commune, so confirm the expected timing with the office handling your registration.
Tax & Social Security
Finally, you’ll need to request a tax identification number, and also ensure that your company is registered with Andorra’s social security fund, CASS.
If this is your sole company and it’s used to gain active residency in Andorra you will need to pay CASS. This can either be paid by yourself as an individual, or by the company.
How Much Does It Cost to Get Set Up?
Ask for an itemised quote covering official fees, notary, foreign-investment authorisation where required, address and activity registrations, translations and professional help. Share capital and immigration contributions are separate from formation fees.
A local professional can help with the sequence and documents, especially if you do not work comfortably in Catalan. Compare the scope and exclusions of the quote rather than treating the old €4,000 example as a current standard price.
A local adviser can help you prepare the correct documents, understand the sequence of steps and communicate with the relevant offices.
The outlay can see you doing business a lot sooner than if you decide to fly solo.
How Long Does It Take to Start a Business in Andorra?
On the whole, you should expect the process to take anywhere up to three or four months. This will depend on:
- the type of company you’re registering
- the commune the company will be registered in,
- the category your business operates in,
- how clear your business plan is,
- what time of year it is, and
- where non-resident shareholders are from.
Failure to submit the correct documentation or being too vague in your business plan will result in delays. This is really where an agent can help a great deal, as they know what the government departments and banks want to see.
Remember, the more complicated your business setup is in terms of stakeholders, the longer and more complicated the registration process will be.
What About Buying an Existing Business?
Buying an existing business to speed up the process isn’t very common. The time saved is negligible at best. To begin with, whether you are starting a business or buying an existing one, as a non-resident you still require foreign investment authorisation.
Putting the company in your name will still need to be processed by a notary and lastly, along with transferring the company bank account and assets, which comes with its own set of hoops to jump through.
On top of that, there’s all the due diligence you’ll need to do to make sure the company is in good standing, outstanding debt is taken care of, and so on. Given all of this, starting from scratch can actually be easier and quicker.
Buying an interest in an existing company does not bypass Immigration’s requirements. The company-based route requires more than 34% ownership and effective management/control, alongside the financial, activity and quota conditions.
Obviously the difficulty in doing this makes it very uncommon—if you don’t yet know anyone in the country, it’s unlikely you’re going to get an offer to become a business partner!
Can You Start a Company Without Actually Living Here?
If you have commitments that require you to be elsewhere, doing business in Andorra is still a possibility. However, your company will need to have economic substance in the country to make this happen.
Without this, you won’t get the benefits of Andorra’s tax status, since that company will likely be domiciled in your personal place of residence.
The company needs an appropriate registered address and must meet the requirements for its activity and management. A coworking desk is not automatically a qualifying commercial address. Nor does every company need to hire a separate local director or secretary; agree the actual management and registration requirements with the notary.
Ready to Start Your Business?
Andorra offers a friendly business environment, strong regulation, transparent policies and a welcoming approach to foreign investments. And let’s not forget low corporate tax (10%) and below average capital gains tax.
If you’re dreaming of forming a company in Andorra and putting down roots here, I don’t blame you. Doing business here poses some attractive benefits, with one being a clear path to residency.
Remember that, after first determining which type of business you want to incorporate and gathering all the relevant documentation, you’ll need an Andorran bank account, a capital sum of money to deposit into it, and a sound business plan.
If you’re ready to take the leap, keep the key takeaways from this article in mind as you embark on your exciting business adventure.