Tax Free for Andorra residents: how to recover VAT in Spain and France

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Understanding Tax Free as a global fiscal mechanism

The Tax Free system — known in Spain as the travellers’ regime and in France as détaxe TVA — is one of the most effective tools for ensuring that indirect taxes are applied where goods are actually consumed.

Its logic is straightforward: if a non-resident buys a product in a country and physically exports it to consume it elsewhere, they should not bear the VAT of the country of purchase.

This is a global mechanism. Although Europe has harmonised it through Directive 2006/112/EC, many countries apply equivalent systems: Japan, South Korea, Singapore, the UAE, Switzerland or Norway, among others. The main exception is the United States, which has no federal VAT and no generalised refund system.

For Andorra residents — a non-EU territory — Tax Free is an everyday advantage: most purchases made in Spain, France or other European countries can benefit from VAT reimbursement if the requirements are met.

➤ If you also want to understand how Andorra taxes consumption, the article VAT in Andorra: how IGI works may help.

What Tax Free is and the legal framework behind it❓

Tax Free allows residents outside the European Union to recover the VAT paid on purchases made within the EU, provided that the goods are physically exported.

Its legal basis includes:

• Directive 2006/112/EC (travellers’ regime / détaxe)
• National rules on private export of goods
• Customs exit procedures

Universal fiscal logic:

• VAT taxes consumption, not purchase.
• Tax must be paid in the country where the good will be used.
• If exported, VAT must be refunded and paid in the country of residence.

Criteria have tightened: you must be a tax resident outside the EU.

➤ To understand how non-EU tax residence works, see Tax residency in Andorra: requirements and real advantages.

A system present in most countries with VAT

Although Europe has the most developed framework, many countries apply equivalent systems:

• Switzerland, Norway, Iceland
• Japan, South Korea, Singapore
• UAE and Gulf countries
• United Kingdom (partial system after Brexit)

Main exception:

• United States: no federal VAT, state-level sales tax, no general refund regime.

Goods eligible for Tax Free

The system applies only to tangible goods purchased by private individuals and physically exportable.

✔️ Eligible goods

• Clothing and footwear
• Electronics and technology
• Watches and jewellery
• Cosmetics, optics, accessories
• Home goods
• Almost any transportable product

❌ Goods or services NOT eligible

Not applicable when the consumption occurs in the country:

• Restaurants
• Hotels
• Leisure and activities
• Professional services
• Immediate-use services (SPA, events, etc.)

➤ For cross-border consumption logic, see Customs agreement between Andorra and the European Union.

The digital procedure: fast and paperless

The Tax Free process has evolved into an almost fully digital system.
In Spain:

• Electronic DIVA/DER form
• Presentation at customs
• Digital validation
• Automatic refund

Standard steps:

• The shop issues DIVA/DER (barcode).
• The traveller presents it at the exit customs point.
• Customs validates the export electronically.
• VAT refund is processed.

Objectives:

• Reduce administrative friction
• Promote cross-border shopping, especially near Andorra

In France, the process relies on PABLO (ePABLO), which allows electronic validation of the détaxe in most shops and airports.
However, the Andorra–France border has no PABLO terminals, so validation requires a manual customs stamp or later validation at a designated point.

Is there a minimum amount?

In most EU countries — including Spain — there is no longer a minimum spend to apply for Tax Free.

Particularly beneficial for:

• Electronics
• Premium fashion
• Jewellery and watches
• Technical or professional equipment

For complex goods like vehicles:

• The VAT refund principle remains
• But the process involves customs transit and specific agents
• Import must be properly declared in the destination country

A case-by-case assessment is recommended.

Why Tax Free is especially advantageous for Andorra residents

The regime applies to all residents outside the EU, including:

• Andorran nationals (except those residing in the EU)
• Andorra tax residents
• Swiss residents
• UK residents post-Brexit
• Travellers from the US, Latin America, Russia, Asia

Advantages specific to Andorra residents:

• Immediate proximity to Spain and France
• High frequency of cross-border purchases
• Fast digital refunds
• Significant savings on high-value goods
• Automatic recognition as a non-EU country

In practice, Andorra is one of the territories that benefits the most from the European Tax Free system. It is important to remember that, despite several agreements signed with its neighbouring countries — including the Association Agreement with the European Union, currently under negotiation — Andorra is not part of the EU, nor does it intend to join in the medium or long term. This position allows the Principality to maintain its non-EU status, which is essential for the application of the Tax Free regime.

➤ If you are considering relocating, the article Living and working in Andorra: what you need to know before moving may help.

⚠️Important warning: for private use only

Tax Free is exclusively for purchases intended for personal use.

Not allowed for:

• Business purchases
• Professional use
• Resale

In those cases, applicable rules include:

• VAT place-of-supply rules
• EU intra-community VAT
• Reverse charge
• Accounting and tax obligations

Abuse has already been sanctioned severely.

A structural advantage for Andorra residents

Tax Free ensures proper taxation of consumption while encouraging economic activity. For residents in Andorra, it is a daily advantage: it allows them to optimise purchases, reduce the cost of high-value goods and take advantage of a fast and simple digital system—especially when buying products that, due to the country’s size, cannot easily be found in the Principality.

Andorra stands out not only for its taxation of income and companies; it also offers a privileged ecosystem for smart and efficient consumption.

If you are unsure whether you qualify or how to proceed, you may book a personalised meeting or contact us via the form.

Last updated: November 2025