Andorra is not a tax haven, but it is true that there are some benefits compared to other countries: Corporation Tax [CT]: maximum of 10%. There is also a reduced tax of 2% for companies involved in certain types of activities such as international trade , investments, etc. For all these reasons it is very interesting for digital companies to consider starting or moving their business to Andorra. Specially for marketplaces, ecommerces, Software as a Service (SaaS) or gaming companies.
Doing Business in Andorra
There are several ways of doing business in Andorra, the most common being through the setup of an Andorran limited liability company. Business entities available in Andorra also include: i) the public limited company ii) the branch office of an overseas company and iii) the representative office, although these types of legal entity are less commonly used to do business in Andorra.
The Andorra Limited Liability Company (Societat Limitada – SL)
The Andorra LLC is commonly used by global entrepreneurs, as foreigners may now own 100% of both trading and non-trading (holding) company in Andorra. Andorra business setup requires the appointment of one director and two shareholders of any nationality. The shareholders are required to invest a minimum paid-up share capital of €3,000 in order to complete Andorra business setup.
The Andorra Public Limited Company (Societat Anonima – SA)
This business entity is recommended for larger companies that intend to become publicly listed. Such a company requires a minimum capital of €60,000 for incorporation. At least two shareholders of any nationality must be appointed. To give your company a marketing edge, LegalGenius™ recommends establish an Andorra PLC instead of a LLC.
The Andorra branch office
The branch is an extension of an overseas company. It must however have an independent management team and corporate bank account based in Andorra.
The Andorra representative office
Andorra representative offices are not allowed to make direct sales within Andorra or to sign any contracts. Consequently, this entity can only engage in market research and promotion of the business of the overseas company.
The Andorra holding company
An Andorra holding company can be formed with only i) 1 shareholder ii) 1 director and iii) a minimum paid-up capital of only €3,000. Directors and shareholders can be foreigners and do not need to be residing in Andorra. Our Clients will also not have to travel to complete the engagement;
An Andorra holding company’s exclusive purpose is the management and holding of participations in non-resident companies located outside Andorra. Under the holding regime, Andorra companies will benefit from tax exemption on i) dividends perceived from overseas subsidiaries and other foreign companies ii) dividends paid to its shareholders in Andorra and overseas and
iii) capital gains obtained from transferring shares to other parties. The dividends received by individual or corporate shareholders of the Andorra holding company will also be exempt of personal/corporate income tax. Companies are not automatically granted tax exemption, they must apply to be included under this special tax regime and be approved by the Andorran Tax Authorities;
Bearer shares are not permitted and the shareholders and directors information is published in the Andorran Public Register. After company registration, it is also mandatory to submit financial statements with the companies registry each year.
How we can help you
If you are considering forming a business or you need expert help with company registration in Algeria, LegalGenius™ is ready to assist you with its skilled team of lawyers, consultants and tax experts. We are committed to making the process as stress-free and streamlined as possible for you, and we will take care of all your document preparation and administrative tasks regarding the registration forms, payment of government fees, local address registration, banking support, etc., whilst always keeping your exact objectives and unique vision in mind throughout the process.
Please use our Company Formation Wizard if you would like to set up your registered company in Algeria or if you would like to know the costs involved prior to proceeding with our exceptional services. For other queries and special requests for complex or customised company formation services, please contact us at firstname.lastname@example.org