Andorra and Montenegro sign the Double Taxation Agreement

🕒 Reading time: 3 minutes

💡 Introduction

The Principality of Andorra and Montenegro have signed a Double Taxation Agreement (DTA) aimed at eliminating double taxation, preventing tax evasion and avoidance, and promoting a stable environment for investment and economic cooperation.

The treaty entered into force on 1 July 2025, following the exchange of diplomatic notifications, and was officially published in the BOPA on 25 June 2025, confirming its enforceability under Andorran law.

⚖️ Context and signature

The Agreement between the Principality of Andorra and Montenegro was signed in New York on 24 September 2024, during the 79th United Nations General Assembly.

The signatories were:

• Imma Tor Faus, Minister of Foreign Affairs of the Government of Andorra.
• Draginja Vuksanović Stanković, Minister of Foreign Affairs of Montenegro.

The Consell General ratified the treaty on 23 January 2025, published in the BOPA No. 22 on 19 February 2025.
Following the completion of domestic procedures, the treaty entered into force on 1 July 2025, as recorded in the edict published in the BOPA No. 77 on 25 June 2025.

🧩 Key provisions of the DTA

Following the OECD Model Convention, the treaty governs both income and wealth taxes, ensuring transparency and predictability for taxpayers.

Main provisions include:

• Tax residency: clear criteria to determine where individuals and entities are taxable.
• Elimination of double taxation: deductions or tax credits for taxes paid in the other jurisdiction.
• Exchange of tax information: cooperation between tax administrations to combat fraud and evasion.
• Anti-abuse clauses: measures to prevent artificial tax arrangements.

The agreement also covers the taxation of dividends, interest, royalties, capital gains and pensions, strengthening legal certainty between both jurisdictions.

🕊️ Entry into force and application

According to Article 28 of the Agreement, the DTA entered into force on 1 July 2025 after the exchange of diplomatic notifications.

Its official publication in the BOPA on 25 June 2025 confirmed its domestic enforceability.

The DTA will apply for tax purposes:

• To withholding taxes on income paid or credited from 1 January 2026.
• To income and wealth taxes for fiscal years beginning on or after 1 January 2026.

🌍 Importance of the agreement

The signing of this DTA reinforces Andorra’s international credibility as a transparent, cooperative jurisdiction aligned with OECD and BEPS standards.

Key impacts:

• For Andorra: expands its network of bilateral tax treaties and strengthens its global reputation.
• For Montenegro: enhances investor protection and facilitates European capital flows.
• For companies and investors: prevents double taxation and supports cross-border economic mobility.

This treaty further consolidates Andorra’s commitment to maintaining a competitive, transparent and internationally recognized tax system.

🧭 Conclusion

The Double Taxation Agreement between Andorra and Montenegro marks another step in Andorra’s fiscal modernization and global integration.
From 2026 onwards, it will provide greater stability and legal certainty for businesses, investors and international residents.

📚 Related articles

• Taxation in Andorra: structure, rates and real advantages — Comprehensive overview of the Andorran tax system.
• Tax residency in Andorra: requirements and benefits (2025) — Practical guide to determining effective tax residency.
• Double Taxation Treaties (DTTs) in Andorra (2025 update) — Updated overview of Andorra’s active bilateral agreements.

Last revision date: October 2025