Taxation in Andorra
Encyclopedia
There is no income tax
in Andorra
on individuals or corporations. Employees pay social security taxes at rates of 5-9% on their salaries; employers pay social security taxes of 13% on their employees' salaries. In October 1991, a form of value-added tax was introduced at a general rate of 4% on most goods and at higher rates of 8% and 12%, respectively, for special goods and for deemed luxury goods. There are also taxes on the import of certain goods. The 1992 budget law introduced a registration tax on certain activities, to provide 8.6% of government revenues, as well as a tax on electricity
consumption and telephone
services at a rate of 10%, to contribute 1.6% of government revenues.
New residents who were previously resident in Spain are treated by the Spanish tax authorities as tax resident in Spain for five tax-years after their emigration to Andorra.
Income tax
An income tax is a tax levied on the income of individuals or businesses . Various income tax systems exist, with varying degrees of tax incidence. Income taxation can be progressive, proportional, or regressive. When the tax is levied on the income of companies, it is often called a corporate...
in Andorra
Andorra
Andorra , officially the Principality of Andorra , also called the Principality of the Valleys of Andorra, , is a small landlocked country in southwestern Europe, located in the eastern Pyrenees mountains and bordered by Spain and France. It is the sixth smallest nation in Europe having an area of...
on individuals or corporations. Employees pay social security taxes at rates of 5-9% on their salaries; employers pay social security taxes of 13% on their employees' salaries. In October 1991, a form of value-added tax was introduced at a general rate of 4% on most goods and at higher rates of 8% and 12%, respectively, for special goods and for deemed luxury goods. There are also taxes on the import of certain goods. The 1992 budget law introduced a registration tax on certain activities, to provide 8.6% of government revenues, as well as a tax on electricity
Electricity
Electricity is a general term encompassing a variety of phenomena resulting from the presence and flow of electric charge. These include many easily recognizable phenomena, such as lightning, static electricity, and the flow of electrical current in an electrical wire...
consumption and telephone
Telephone
The telephone , colloquially referred to as a phone, is a telecommunications device that transmits and receives sounds, usually the human voice. Telephones are a point-to-point communication system whose most basic function is to allow two people separated by large distances to talk to each other...
services at a rate of 10%, to contribute 1.6% of government revenues.
New residents who were previously resident in Spain are treated by the Spanish tax authorities as tax resident in Spain for five tax-years after their emigration to Andorra.