The benefits of Andorra’s tax system are obvious when compared to the vast majority of European countries, which makes it an incredibly attractive location for the creation of companies and corporations. In addition, Andorra boasts a very high level of personal safety (it has one of the lowest national crime rates worldwide), a superb health and education system, and a per capita income that is among the highest in the world.
Andorra is the perfect country for investment and business, and also for year-round living.
How to open a company in Andorra
The formalities required for a non-resident to create a company in Andorra have become more flexible in an effort to boost attractiveness for entrepreneurs and investors looking to reduce the tax burdens on their businesses.
The first step is selecting the type of corporation that is most suited to the kind of business you wish to open in Andorra. The available options are:
Public Limited Company (SA – Societata anònima): with a minimum of €60,000 in start-up capital. This is the option typically chosen by large companies, whose capital can be distributed among all the shareholders or just a single person when opting for a Sole-Shareholder Public Limited Company (SAU – Sociedad Anónima Unipersonal).
Private Limited Company (SL – Societat limitada): normally created by smaller trading or service companies. This option requires a minimum of €3,000 initial capital, which can also be distributed among several partners or just a single person when opting for a Sole-Shareholder Private Limited Company (SLU – Societat limitada unipersonal).
Once registered in the Company Registry, both the SA and SL options will have their own legal personality that is distinct from that of the partner or partners of which they are comprised. Every Andorran corporation is required to have a registered office within the country.
Process for the creation of a commercial corporation
The bureaucratic formalities required to open a corporation in Andorra have been simplified and streamlined. Now you can have your business open and operating in the country in a little over two months. The steps of the process are as follows:
1) Request to the government to reserve a corporate name. This certification will expire 6 months after it is issued; during its validity it grants a name reservation in favour of the future grantors of the deed.
2) Request to the government for authorisation of foreign investment, for foreign investments greater than 10% of the share capital.
3) Request to open a bank account with one of the country’s financial institutions.
4) Public deed for the incorporation of the company formalised by an Andorran notary public.
5) Registration of the corporation in the Andorran Company Registry (or in the Registry of Trade and Industry if the corporation conducts activities of a commercial, industrial or service nature). This registration is compulsory and is that which will confer the corporation legal personality.
6) Business opening request (for which it will be necessary to have the Electrical Inspection Certificate for the establishment and a valid contract for fire extinguishers).
If you want to establish a company or corporation in Andorra to benefit from a maximum corporate tax on profits of 10% and social contributions of just 15.5%, we can help. The Advantia Assessors team has in-depth knowledge of all the formalities required to open companies in Andorra, making the process more streamlined and totally convenient for our clients.