Company formation in Andorra

For over 15 years, we have successfully helped businesses and individuals through all company formation steps in Andorra. Setting up a business requires quick, efficient and correct input by lawyers and tax specialists to be effective. Below we outline what is needed to form a company in Andorra, the company entity types, the benefits of setting up a company in Andorra and answer some of your concerns such as buying a company off-the-shelf.

How to form a company in Andorra

There are no offshore entities in Andorra. All companies trading there must have a registered office. Small companies can be set up in a private apartment or business centre.

Every company requires a proper director. The director can be a non-resident. It is technically possible to be an owner and director of an Andorran company without physically living there. It is uncommon to appoint a nominee director in Andorra due to the position’s legal responsibilities. Being a director requires a certain level of presence in the country. Substance requirements in Andorra depend largely on the company’s activities and the countries it is trading with. If a non-resident director is managing the company, we recommend a local employee to be present at least part-time. If you are considering forming a company in Andorra, just contact us for advice.

The benefits of creating and setting up a company in Andorra?

LOW TAX RATE - Depending on company activity, a 2 - 10% corporate tax rate.
LOW MONTHLY OUTGOINGS COSTS - Low labour costs. A minimum wage at 950 EUR, social security for employers 15.5% and office space competitively priced vs. Spain and France
SUBSTANCE, COMPLIANCE AND TAX MODELS - OECD and BEPS compliant tax models and standards.
TRAVEL WITHIN THE SCHENGEN AREA - VISA benefits open to non-EU member directors and shareholders. This allows easier travel within the Schengen area for non-EU individuals.
DOUBLE TAX AGREEMENTS - There are several double tax agreements (DTA) in place with European countries or in process to be agreed upon
SPECIAL ADVANTAGES FOR HOLDINGS - There are special holding entities available that allow for 0% taxation with a significant participation in an international company

Feasibility

Setting up a company is an important decision and a feasibility study will be suggested by us.

Tailor-Made Solutions

We providing you with optimal solutions for your specific project after the initial analysis of your business model.

Implementation

Once analysed a proper solution for your project we implement the strategy and set up the company.

Maintenance + Follow up

With the company active and your business running we maintain accounting and legal requirements.

Company formation step by step

AND Solutions provides you a proper analysis and consultation before your company formation in Andorra. Considering all legal and taxation aspects is important to make the process as smooth as possible for you and base the new company within the proper legal framework.

Your new company project in Andorra will require an application for foreign investment if you are a non-resident investor. Our legal partners are specialists for this process and accompany you in each step. Criminal records and business plan information have to be provided.

Before opening a company account you must go through Andorran banking compliance which is the most important step that requires professionals to consult you. Due diligence at the higest level is necessary for the KYC (Know Your Customer) selection process of the bank. Expect delays without proper documentation and transparency in your tax + financial records.

We prepare the articles of incorporation together with all the minutes needed for the proper incorporation of your Andorra company signed off at a local Andorran notary. Each shareholder / partner with more than 10% needs to be present during the formal incorporation at the notary in Andorra.

Your actively trading company needs to be activated as Commerce with the local authorities. This step is requiring the registration of your company in a proper office or dedicated room in your home. All requirements for your activity code have to be met as well as an electrical counter and fire extinguisher need to be registered for your company. Further we request the activation in the social security and the tax code NRT.

To constitute a company, articles of association must be established by private deed or by deed (notarial deed). The statutes are registered at the Tax office (Direction des Services Fiscaux). This is a pre-requisite for obtaining a business authorisation practice license.

Company entity types in Andorra

The following company entity types exist currently in Andorra:

1. Limited Liability Company – Societat Limitada (S.L.)
  This type of company is mostly used for small and medium sized businesses with one or a limited number of shareholders. The minimum capital requirement is 3000 EUR. There may be one shareholder only (S.L.U.).
1. Anonymous Limited Liability Company – Societat Anònima (S.A.)
  Typically a S.A company is a larger enterprise with significant initial capital such as a holding company (60,000 EUR) and various shareholders. For entities with one shareholder create a S.A.U. There are no publicly traded entities in Andorra as the country does not have a stock exchange. Even so, it is possible for companies set up and be listed on a foreign stock exchange.
In Andorra, foreigners can own 100% of a trading, or holding company. Non-resident shareholders who have 10% holding of the company’s capital, will have to authorized by an Andorran government process.

Who creates companies in Andorra ?

Creating a company in Andorra is typically the base for moving the residency of the director or shareholders as there is no offshore company without any sort of human resources possible in Andorra. Looking into the nationalities starting Andorran companies we find the following profiles:

Spanish
French
Swiss

Frequently Asked Questions

Can I Buy A Readymade Or Company Off-The-Shelf?

Buying a readymade company in Andorra is a false economy. Set-up time (foreign investment application, notary, trade registry inscription) and resources needed to set up a readymade company is nearly the same as setting up a new one. We recommend creating new companies.

Can I get a nominee director in Andorra?

Nominee directors in Andorra are generally a possibility however the company laws are giving directors substantial decision power and directors a are legally responsible for the company’s decisions. Therefore it is uncommon unless a director is fully and actively working for the company.

Can I domicile a company in your office?

Your company needs to have a proper office space with an individual electricity meter and a fire extinguisher by Andorran law. There is no mailbox system or domicile for multiple companies of different owners at the same office or address. Be aware that this is means typically an office must be rented. However office space is affordable and a unit at a business center or a private apartment may run at under 400 EUR / monthly.

How long does it take to create a company in Andorra?

Expect a minimum of 10 weeks to create and activate your company in Andorra. Depending on banking compliance for the account opening this may exceed 12 weeks.

How much does it cost to create the company?

The formation of a company in Andorra is a process that takes multiple steps from an initialy feasibility study over to several due diligence processes with the Andorran government and banks. Unlike company formations in neighboring countries or Anglo-Saxon countries the process in Andorra is much more complex. The cost will depend on how many non-resident shareholders are participating in the company, whether a holding company only or an actively trading company and finally on the activity of the company itself. Expect around 800 EUR in notary costs, 1000 – 1250 EUR in government fees and legal fees between 3000 – 4000 EUR. We suggest to contact us for more details.