Immigration to Andorra for High Net Worth Individuals

The Principality of Andorra is a landlocked microstate in South-Western 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 468 sq. km and an estimated population of 85,000 in 2012. Official language is Catalan, although Spanish, Portuguese, and French are also commonly spoken. The Principality was formed in 1278. The role of monarch is exercised jointly by the two co-princes, the Catalan Bishop of Urgell and the President of France. Andorra is a prosperous country mainly because of its tourism industry, which services an estimated 10.2 million visitors annually.

In addition, Andorra has a status of a tax haven (no personal taxation, no wealth, income, capital gains, dividend taxes or estate duty). It is not a member of the European Union, but the euro is the de facto currency. The people of Andorra have the 4th highest human life expectancy in the world – 82 years at birth.

Effective from the 1^st of May 2012 the immigration legislation of Andorra was amended. Physical presence requirement (to maintain the resident status) was reduced from 184 to 90 days per year. The amendments make Andorra even more attractive for so-called “high-net worth individuals” who often dislike the strings attached to residency permits. Moreover, the input threshold was raised to EUR 400,000 (if you invest less you cannot be eligible for a residence permit). Nevertheless, this is not a problem for millionaires. There are currently three types of passive residence in the Principality of Andorra:

1. Resident without gainful activity.

a)         Official requirement to reside minimum of 90 days per calendar year in Andorra

b)         Minimum investment required: total of EUR 400.000 in either: Real estate in Andorra or Shareholding in an Andorran company or Financial Investments (e.g. equities, deposits, government debt, corporate debt and other traded financial instruments)

c)         Requirement to prove economic means for independent funding of lifestyle in Andorra via proof of income. Initial deposit required (EUR 50.000 per principal person + EUR 10.000 per dependent held by Andorran Government). These amounts form part of the total EUR 400.000 required.

2. Resident as a professional with an international business

a)         Min 1 employee in Andorra

b)         85% of the revenues to be generated outside Andorra

c)         Requirement to prove economic means for independent funding of lifestyle in Andorra via proof of income. Initial deposit required (EUR 50.000 per principal person + EUR 10.000 per dependent held by Andorran Government).

3. Resident because of a scientific, cultural or sports reason

a)         Official requirement to reside minimum of 90 days per calendar year in Andorra

b)         Requirement to prove economic means for independent funding of lifestyle in Andorra via proof of income. Initial deposit required (EUR 50.000 per principal person + EUR 10.000 per dependent held by Andorran Government).

Andorran Residence brings the following advantages:

1. Legal right to travel between Andorra, Spain, and France without restriction
2. Right to obtain Andorran citizenship after qualifying period
3. Obtain permanent residence permit in Andorra for all family members after qualifying period
4. No right to work or rent commercial premises (active residence required)
5. No personal taxation, minimal indirect taxation. No wealth, income, capital gains, dividend taxes or estate duty
6. World class medical facilities and international schooling
7. Safety and low crime rate

Read also our article on relocation to Switzerland

Questions and answers about residency in Andorra:

Question: I would like to ask you what is needed to obtain citizenship of Andorra. I would like to invest in the purchase of real estate. On your site, I read that if you buy real estate of certain prices you can automatically get a citizenship. May I ask you for more details about this?
Answer: Andorran citizenship is one of the most unobtainable in the world. You can apply for this citizenship after 20 years of residence in Andorra (provided you permanently resided there at least 10 years before the application). Moreover, dual citizenship is not recognized and you will be required to renounce your first citizenship/passport before getting Andorran passport. In Andorra, you can get only residency permit provided you invest 400,000 EUR. Rich foreigners choose Andorra because of the favorable tax regime, not because of citizenship.

Question: I would like to know more about becoming a resident of Andorra, as a professional with an international business. I have a few companies setup the world over and in the next few months I am about to launch a franchise based business in the U.K, as I am the director of said company, I am looking into my options of becoming a citizen in a more financially lenient principality. I have assessed all available options and I believe Andorra fulfils all my requirements. I know that you offer legal services to facilitate my request, so please let me know what will need to be done to fulfil my request.
Answer: Andorra is good for residency (temporary and permanent residency permits). Nevertheless, from the viewpoint of citizenship and passport it is not the good choice. Citizenship application is available after 20 years of actual physical residence in Andorra with valid residency permits.

If you have any question regarding above-mentioned material or wish to use our legal assistance in obtaining residency permit in Andorra, contact us today