Living in Andorra can undoubtedly be an intelligent decision in many and varied aspects. Before making the decision to relocate to another country, the most natural thing to do is to ask yourself questions such as whether it is the ideal place for me, in which parish of Andorra is it better for my home and my office or workplace, whether the language will be a major barrier in day-to-day life, whether my partner and children will have problems adapting, and many more questions that can become a headache for any expatriate. For this reason, we have put together on this page some general information on aspects that we consider important to take into account when deciding to make this decision.
It is not only of value to learn about tax formalities, which are undoubtedly very important, but also about the legal formalities you will have to complete in order to formalise your residence in Andorra. Another key issue is the purchase or rental of a property in Andorra; being able to properly assess whether the price of a house in Andorra is in line with the current market is not trivial.
We hope that the information provided below may be useful to you in order to simplify in part the decision to come to live in Andorra.
Brief description of Andorra
We have prepared a brief description of the country without delving into the history of Andorra. Officially it is known as the Principality of Andorra. It is a parliamentary democracy where the Andorran people are the sole sovereigns of the state and the elected president is the head of government. There are also co-princes, ruled by the bishop of La Seu d’Urgell and the president of France. A curious fact about the latter is that every time the offices change, the princes change as well.
The country’s location is incredibly privileged if you like snow sports, hiking or just being close to nature. It lies in the heart of the Pyrenees and shares borders with Spain and France. The communication by land to important cities in the neighbouring countries such as Barcelona and Toulouse is good and fast.
The Principality is divided into 7 parishes. In each of them there is a town hall, known locally as “Comú”, which is in charge of local formalities such as the registration of residents, the land registry, commercial authorization, etc.
What you should know about Andorra
What language is spoken in Andorra?
The official and predominant language in Andorra is Catalan. However, due to the cultural diversity of its inhabitants, the existing educational systems and the influx of tourists, Spanish, French and Portuguese are also present in Andorran daily life. According to the Andorran Department of Statistics, the total population for 2020 was 78,015 inhabitants, of which 37,999 are Andorran and the rest are of foreign origin. Spaniards head this list of foreigners resident in Andorra with 19,211, followed by Portuguese with 9,083 and French with 3,423 inhabitants.
If your mother tongue is Catalan, Spanish or French, we have good news for you as the language barrier will not be a problem to solve. You will be able to choose the educational system that best suits you for your children taking into account your main language.
Is the healthcare system public or private?
Anyone who has an active residence in Andorra enjoys public health care. They are obliged to join the CASS (Caixa Andorrana de Seguretat Social), the body that administers Social Security in Andorra. It is important to note that Andorran public healthcare is co-paying. This means that the state covers at least 85% of the cost and, depending on the case, up to 100%. For this reason, local insurance companies offer a complementary private insurance that serves to pay the remaining part, thus obtaining total coverage.
For those who have a passive residence in Andorra, it is a prerequisite for obtaining this visa to have taken out private medical insurance with coverage in the Principality. The main insurance companies are present in the country and you can choose the one that suits you best to take out your insurance.
Is it difficult to look for a place to live in Andorra?
A key step in relocating from your country is the search for houses in Andorra. Deciding which is better, house or flat in Andorra, is one of the many questions you will surely ask yourself. Since 2019, the demand for property has been increasing in the Principality. This has led to a rise in prices compared to previous years. In addition, the pace of construction has been low in recent years. As a result of all these factors, houses and flats, both to rent and to buy, are somewhat scarce in the country. Our recommendation is to seek advice from real estate agents who are duly registered in Andorra. There are a total of 7 parishes in Andorra and perhaps one that you may not have considered initially, you will see with new eyes when you visit and appreciate the services that are available.
How do I obtain residency in Andorra?
The process for obtaining residency in Andorra is very clear and precise. There are no shortcuts to complete the existing conditions for living in Andorra. If your intention is to maintain your economic activity in your country of origin and you just want to enjoy the advantages of living in Andorra, you can apply for passive residency. On the other hand, if you also want to relocate your company in Andorra or create a new one, we are talking about an active residency. The process for obtaining any of the residences in Andorra takes about 2 months. We strongly suggest that you seek the services of specialists such as Andorra Solutions to guide you through all the steps and avoid unnecessary delays.
For how long can you live in Andorra?
As long as you meet the conditions of your type of residency, you can live in Andorra for as many years as you wish. The types of residency in Andorra are not permanent. This means that you must renew them periodically. At the beginning, renewals are every 2 or 3 years, depending on the case. But, as time goes by, the renewals are longer and are done every 10 years. We remind you that you must always prove that you still meet the requirements of your type of residency in order to be authorised to renew it. It is also possible to change the type of residency, from active to passive for example, if your needs change over time.
Taxation in Andorra
Taxes in Andorra
We must highlight one of the factors that attracts most residents to this country: taxation in Andorra. The rules in this respect are very clear. This is why the creation of new companies in Andorra continues to grow. Corporate tax in Andorra is one of the lowest in Europe and ranges from 2% to 10%, calculated on the profits obtained by the company. Personal income tax in Andorra (IRPF) is extremely beneficial. Up to 24,000 euros of annual income, no tax is payable. For income between 24,000 and 40,000 euros per year, the rate is 5% and for income over 40,000 euros per year, the rate is 10%. VAT in Andorra (IGI), is only 4.5% and the reduced rate is 1%. In addition, donations and inheritances are exempt from tax in Andorra.
Infrastructures in Andorra
How to get to Andorra?
The Principality has a road network that will allow you to get to Andorra comfortably by car. It is possible to drive all over the country and also to reach neighbouring countries, Spain and France, quickly and safely. There are proposals for Andorra to have its own airport, but these have not yet been finalised. However, residents of Andorra have several major airports nearby:
- Andorra – La Seu d’Urgell Airport located in Montferrer – Lleida: it has GPS approach certification which will allow in the future receiving flights of up to 2 hours radius with cities such as London, Frankfurt, Paris or Amsterdam. It is 32 minutes by car from the capital of Andorra.
- Toulouse International Airport – in Blagnac France: offers flights to cities in France, Turkey, Belgium, Germany, Italy, Spain, Morocco, Tunisia, among other countries.
- Barcelona International Airport – located in El Prat del Llobregat. From here you can travel virtually anywhere in the world.
Both Toulouse and Barcelona airports are approximately 2.5 hours from Andorra la Vella by car. There are also several bus lines that cover these routes on a daily basis.
Safety and quality of life in Andorra
There are decisive aspects that influence when deciding where to move to, whether alone or with your family. Despite the economic advantages Andorra offers, personal safety and quality of life are also of great importance. As far as security is concerned, Andorra scores highly, with a crime rate that is practically non-existent. Residents and visitors alike feel safe when travelling in the country. According to the travelriskmap website, the security risk in Andorra is negligible.
Andorra also has a dry Mediterranean mountain climate which is very pleasant. Temperatures can drop as low as -4° Celsius in the winter and a high of 34° Celsius in the summer. You will enjoy practically pure air all year round thanks to its mountainous nature and low pollution. Life expectancy in Andorra is among the highest in the world. All these factors mean that the people of Andorra have a high and healthy quality of life.
Essential procedures in Andorra
Whether it is for the homologation of your driver’s license or obtaining a new one, our associates can assist you throughout the entire process. Contact us for a personalized consultation.
Advantages and disadvantages of living in Andorra
The advantages of living in Andorra are abundant. Residing in a place with beautiful natural views all year round, a Mediterranean mountain climate (even if the winter is long), enjoying high personal security, access to quality primary services, low taxation and only a few hours from Spain and France, certainly has a lot to offer for people who decide to change their residency to Andorra. However, there are factors that can dampen interest in this country. People who enjoy living in big cities may feel a little “bored” in Andorra. Life is very quiet. There are local events throughout the year, festivals of international interest, but perhaps not as much on offer as other major European cities.
In terms of employment, if you are not an entrepreneur, salaries in Andorra are less interesting than in other countries and the offers are concentrated on qualified profiles, especially in technological, fiscal and health fields.
Our recommendation is that you let the relocation specialists at Andorra Solutions advise you in order to obtain a personalised assessment. In this way, you will be able to make the right decision regarding your change of residence to Andorra.