Tax and accounting obligations in Andorra: what companies and freelancers must comply with

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🧾 Operating in Andorra means more than invoicing: the obligations every company and self-employed professional must know

Running a business or professional activity in Andorra goes far beyond issuing invoices and paying occasional taxes. The Andorran system combines accounting and tax obligations that must be complied with rigorously if you want to avoid penalties, adjustments or problems in future inspections or banking reviews. These obligations can also have a significant impact abroad when dealing with foreign banks, administrations or other institutions.

The fact that Andorra has a moderate tax burden does not mean that the Administration ignores compliance. The Law on the General Indirect Tax (IGI), the Corporate Income Tax Law, and the Entrepreneurs’ Accounting Law clearly set out which filings must be submitted, when, and on which accounting principles they are based.

This article provides a structured overview of the core obligations that apply to Andorran companies and self-employed professionals carrying out economic activity in the country.

⚠️ In Andorra, incorporating a company is not enough to start invoicing: you must obtain a commercial licence. Without this authorisation, the company has no operative activity and cannot legally trade.

To learn more, we recommend the article Opening a business and obtaining the commercial licence in Andorra: requirements and essential regulations.

🧾 Who is required to comply with these obligations?

Andorran legislation is built on a key concept: economic activity. According to the IGI Law, any organisation of material or human resources aimed at producing goods or providing services for one’s own account qualifies as an economic activity, expressly including the leasing of property.

The following profiles are typically affected:

• Andorran companies (SL, SA or other legal forms) carrying out real economic activity
• self-employed professionals, who operate as individuals but organise resources to provide services or sell products
• non-residents operating in Andorra through a permanent establishment or obtaining certain income in the country

All of them must:

• keep accounting records in accordance with the Entrepreneurs’ Accounting Law
• comply with IGI obligations, where applicable
• meet their obligations regarding corporate income tax or the relevant form of personal income taxation
• and, in some cases, satisfy additional obligations (communal taxes, withholding tax on payments to non-residents, etc.)

This article focuses on this core set of obligations, which is usually what generates the most practical questions for business owners and professionals.

📚 Essential accounting obligations: much more than “keeping the books up to date”

The Entrepreneurs’ Accounting Law establishes that businesses must maintain orderly and activity-appropriate accounting, ensuring traceability of all operations. This includes:

• keeping accounting books
• preparing annual accounts
• preserving supporting documentation for the legally required period

🔹 Preparing the annual accounts

Annual accounts must be prepared within six months after the end of the financial year.

In practice, since most companies close on 31 December, the annual accounts must be prepared no later than 30 June of the following year.

🔹 Purpose of the annual accounts (CCAA)

For companies, these accounts form the basis for the corporate income tax return and act as the “official snapshot” that banks, auditors or potential buyers may request.

For self-employed professionals, even though they are not currently required to file annual accounts, the logic is the same: clear and well-organised accounting is essential to justify expenses, accredit income and demonstrate the reality of the business to the Administration or third parties.

➤ To better understand the foundations of Andorran accounting, see Accounting in Andorra: origin and structure of the General Accounting Plan (PGC).

🧮 IGI returns: periodicity and formal discipline

The General Indirect Tax (IGI) is Andorra’s functional equivalent of VAT in other countries and applies to most supplies of goods and services carried out within the Principality.

To learn more, you can read the article VAT in Andorra: how the General Indirect Tax (IGI) works.

The Law and its Regulation require businesses to:

• file periodic IGI returns
• keep books of issued and received invoices
• issue invoices that comply with formal standards
• and, in the case of non-established taxpayers, appoint a resident fiscal representative if necessary

🔹 Filing frequency

Filing frequency depends on the annual turnover:

• monthly → turnover ≥ €3,600,000
• quarterly → turnover > €250,000 and < €3,600,000
• semi-annual → turnover < €250,000

🔹 Filing deadlines

Each return must be submitted during the month following the taxable period:

• monthly → before the end of the month in relation to the previous month
• quarterly → before the last day of April, July, October and January
• semi-annual → before 31 January and 31 July

To comply properly, it is essential to invoice correctly, record supported and charged IGI accurately and submit returns on time.

Regarding accounting records, it is important to apply the accrual principle established by law. For more information, you can read The accrual principle in Andorra: the key to solid and tax-compliant accounting.

🏢 Corporate income tax (CIT): calendar, coherence and documentation

Corporate income tax (CIT) applies to profits generated by Andorran legal entities and permanent establishments, in accordance with Law 95/2010 and its Regulation. For a deeper understanding, see Corporate income tax in Andorra: rates, special regimes and tax deductions.

Three elements are essential:

• the tax period
• the filing deadline
• how the annual accounts interact with the return

🔹 CIT filing and financial year

Financial year

A company’s financial year cannot exceed 12 months and may only be shorter:

• in its year of incorporation, if it begins activity after the start of the exercise
• in its year of cessation, if the activity ends before the last day of the financial year

By default, the financial year spans 12 months and coincides with the tax year.

Tax year

CIT must be filed during the month following the six months after the end of the tax period.

Example: standard year-end on 31 December

• closing date: 31 December
• annual accounts prepared by: 30 June
• CIT filing: throughout July

Key considerations

CIT is a self-assessment tax: the taxpayer must calculate the tax due. Payment is usually made by bank direct debit, or alternatively by transfer.

🔹 Filing the annual accounts

In practice, the CIT return is filed together with the annual accounts for the corresponding period.
These accounts are deposited during the month following the six-month preparation period.

🔹 The special case of self-employed professionals

For self-employed professionals, the tax structure differs, but the logic of financial year, closing, filing and accounting coherence remains equally relevant. The main distinction is that, although income is calculated following similar criteria (PGC and CIT rules), it is declared through the Personal Income Tax (IRPF).

The IRPF filing period in Andorra runs from 1 April to 30 September.

If you want to learn more, see Personal income tax (IRPF) in Andorra.

If you want to understand the contribution regimes applicable to self-employed workers, you can consult Social security contributions for self-employed workers in the CASS: reduced regimes and general obligations.

🌍 Other obligations: non-residents, communal taxes and regulated activities

Beyond IGI and CIT, other obligations may arise depending on the type of activity, the legal form and the source or destination of income.

🔹 Obligations on payments to foreign recipients

When a company or professional makes certain payments to a non-resident (services, royalties, etc.), Andorran law may require the application of withholding taxes or other specific rules under the Non-Resident Income Tax (IRNR). Double tax treaties may also apply.

To learn more, see Non-Resident Income Tax (IRNR) in Andorra and Double taxation treaties: the key to understanding where international income is really taxed.

🔹 Communal / parish taxes

At the local level, communes may impose taxes on economic activities (deductible for CIT purposes) or on certain types of income, such as rental income or taxes linked to commercial activity within the parish.

To deepen your understanding, you can read Rental income tax in Andorra: rates applied by each parish and Property tax in Andorra: what it is and how each parish calculates it.

For context on Andorra’s administrative divisions, you can consult The parishes of Andorra: structure, functions and territorial characteristics.

🔹 Sector-specific obligations

Certain sectors are subject to additional requirements such as registrations, authorisations or communications to competent authorities, particularly in finance, regulated professions or real estate.

✅ How to stay compliant with confidence

Beyond the wording of the law, the difference between a well-organised business and a risky one often lies in its internal processes. Compliance is not just about submitting forms: it requires working systematically and maintaining order to prevent unpleasant surprises.

It is advisable to define early on your tax and accounting calendar: year-end, IGI deadlines, annual accounts preparation, CIT deadlines and any instalment payments.

It is also essential to ensure that accounting reflects the true economic reality of the business, not just bank movements. Cross-border operations, international services and property-related income often require particular attention. Likewise, distinguishing income generated in Andorra from income generated abroad is fundamental.

To work correctly, it is essential to rely on competent managers, advisers or consultants. To understand the differences between these roles, see Differences Between Managers, Advisors, and Consultants: Which one do you need for your business?

Conclusion: fewer taxes does not mean less control

Andorra offers a competitive tax environment, but this does not mean a “grey zone” without rules. On the contrary: the IGI Law, the Corporate Income Tax Law and the Entrepreneurs’ Accounting Law create a clear framework in which accounting traceability is essential.

Complying with obligations not only avoids penalties: it strengthens the credibility of your business before banks, investors and foreign jurisdictions. In a small and open country like Andorra, a company’s reputation is closely linked to its accounting and fiscal discipline.

If you would like us to review your company’s situation or your activity as a self-employed professional, or if you wish to request a personalised quote, you can use the Contact Form. If you prefer a confidential and expert meeting, you can book an appointment in the footer: we will analyse your case in detail and assist you with everything you need.

Last updated: December 2025