Andorra Residency 2026: Passive Residence and Property Rules

Andorra's passive residency programme allows non-working individuals to live in the principality by making a significant investment and meeting certain criteria. Recent reports say Law 2/2026 raised the main investment threshold to €1 million from €600,000 under earlier rules, but sources differ, so check the Government of Andorra before relying on any figure.

Nestled in the Pyrenees mountains between France and Spain Andorra has long attracted high-net-worth individuals with its unique combination of a high quality of life low taxes and spectacular natural scenery. It offers a secure and discreet environment that appeals to those seeking a European base without the complexities of EU membership. This guide provides a comprehensive overview of Andorra's passive residency programme for 2026 detailing the new property and investment rules tax benefits and the application process. For a broader view on finding a new home country explore our Moving Abroad guides.

Recent changes to Andorran law have significantly increased the investment threshold reflecting the principality's goal of attracting substantial investors while managing its growth sustainably. Understanding these new regulations is crucial for anyone considering this attractive residency option.

Why Andorra Appeals to HNW Investors

Andorra's allure for affluent individuals and their families is multifaceted. It extends far beyond the simple headline benefit of low taxation. The principality has carefully cultivated an environment that prioritises safety financial stability and an exceptional standard of living.

The most prominent advantage is its favourable tax regime. Andorra boasts one of the lowest personal income tax rates in Europe with a top rate of just 10%. It also has no wealth tax and no inheritance or gift tax for spouses and direct descendants. This makes it a compelling alternative to other high-tax jurisdictions in Europe and a leading choice among the world's best low tax countries for HNW individuals. The tax system is simple and transparent which helps in planning your pre-immigration tax strategy.

Andorra is not a member of the European Union but it exists in a customs union with the EU for manufactured goods. This unique status provides residents with easy access to neighbouring France and Spain while maintaining political and fiscal independence. For residents this means freedom of movement into Spain or France is straightforward though it is important to note Andorra is not part of the Schengen Area. Residents require a multiple-entry Schengen visa if their nationality requires one for travel within the zone.

Quality of life is another major draw. The country has one of the highest life expectancies in the world a testament to its excellent healthcare system low crime rates and pristine environment. With over 90% of its territory being undeveloped natural terrain residents enjoy unparalleled access to outdoor activities like skiing hiking and mountain biking. The capital Andorra la Vella is a bustling commercial centre with luxury shopping and fine dining yet it remains clean safe and manageable.

Andorra's Passive Residency Programme 2026

The primary route for investors to move to Andorra is the 'residència sense activitat lucrativa' or residence without lucrative activity. This is commonly known as passive residency. It is designed for individuals who do not intend to work for an Andorran company and can demonstrate sufficient financial means to support themselves.

The core requirements for passive residency are clear and have become more stringent over time. An applicant must:

• Meet a minimum stay requirement. Residents must spend at least 90 days per year in Andorra. This is a relatively low physical presence requirement compared to many other European residency schemes and allows for significant flexibility. You can see how this compares with our guide to golden visa stay requirements.
• Prove sufficient financial means. You must demonstrate that you have the income or wealth to support yourself and any dependants. The commonly cited benchmark for this is proof of an income equivalent to 300% of the Andorran minimum wage. Applicants should always verify the current official figure with the Andorran immigration authorities.
• Hold private health insurance. Applicants must secure a comprehensive private health insurance policy that provides coverage in Andorra. This is a non-negotiable requirement of the application.
• Provide a clean criminal record. You must submit police certificates from your country of origin and any country where you have resided for the last five years. These must be apostilled.
• Make a qualifying investment and deposit. This is the most significant part of the application and has been subject to recent changes which are detailed below.

This programme does not permit the holder to be employed by an Andorran company or to actively run a business in the principality. It is strictly for those who can live off passive income investments or pensions.

The New €1 Million Investment Threshold: Law 2/2026

Recent reports say Law 2/2026 introduced significant changes to the foreign investment and residency framework. The most notable change was the increase in the minimum investment required for passive residency. The threshold which previously stood at €600,000 has been raised to €1 million according to those reports. Sources differ on the details, including the lower amount that applies to investment in the Andorran Housing Fund and the size of the deposit, so check govern.ad before relying on any figure.

This €1 million investment must be made in one or more qualifying asset classes. It is a substantial increase that positions Andorra as a premium residency destination competing with jurisdictions like Monaco. You can read a direct comparison in our guide to Monaco residency for HNW individuals.

In addition to the main investment applicants are also required to lodge a non-interest-bearing deposit with the Andorran Financial Authority (AFA). This deposit is held as a guarantee and is refundable when you relinquish your residency assuming all obligations have been met. The exact amount of this deposit can vary and has been subject to change. Reports from different advisory sources often provide conflicting figures. Therefore it is imperative that applicants do not rely on third-party information and instead confirm the current deposit amount directly with the Government of Andorra or the AFA before making any commitments.

The law also introduced an alternative investment route with a lower financial threshold. This involves making a significant investment into the Andorran Housing Fund (Fons de l'Habitatge). The government's aim with this option is to channel foreign capital towards solving the country's housing shortages. The specific amount required for this route has not been included here as it is crucial to obtain the latest figure from an official source.

Qualifying Investments for Passive Residency

Under the reported €1 million rule passive residency applicants have several options for channelling their investment into the Andorran economy. The investment can be made in a single asset or spread across a combination of the following qualifying categories:

• Real Estate: The most popular choice for investors is buying property in Andorra. The investment can be in a single property or multiple properties as long as the total value meets the €1 million threshold. This is a tangible asset that can be used as a personal residence and potentially generate rental income.
• Shares in Andorran Companies: Applicants can invest in the share capital of a resident Andorran company. This can be an existing business or a new company established by the investor though passive residency status prohibits the investor from holding an active management role or receiving a salary.
• Andorran Government Bonds: Investing in debt instruments issued by the Principality of Andorra is another secure and straightforward option. This demonstrates a direct contribution to the nation's finances.
• Andorran Financial Products: The investment can be placed in financial instruments managed by Andorran entities such as investment funds recognised by the AFA. Keeping the funds in a simple deposit within an Andorran bank account also qualifies.

It is vital to understand that this investment must be maintained for the entire duration of the residency permit. If the qualifying asset is sold the resident must reinvest the funds into another qualifying asset within a specified timeframe to avoid losing their residency status. This makes the initial choice of investment a critical part of a long-term plan B citizenship strategy.

Andorra Passive Residency vs Other Options

When considering a move to Europe for tax efficiency and quality of life high-net-worth individuals have several premium options. Andorra Monaco and Switzerland are often compared. The table below outlines the key differences in their non-working residency programmes.

Andorra's programme offers a middle ground. Its investment requirement is now substantial but it provides a clear path to residency based on a tangible asset like property. Its tax system is not a 'zero-tax' one like Monaco but its 10% rate is extremely competitive and its system is OECD-compliant. The 90-day stay requirement is also less onerous than Switzerland's making it ideal for those who need global mobility. For more details on Swiss rules see our guide on lump-sum taxation in Switzerland.

Want help comparing your options? Get matched with a specialist from one of our partner advisory firms.

Buying Property in Andorra as a Foreigner

For most passive residency applicants buying property in Andorra is the preferred way to meet the €1 million investment requirement. The process is transparent and well-regulated but involves several key steps that foreign buyers must navigate.

Before any non-resident can purchase property they must first obtain an authorisation for foreign investment (Autorització d'inversió estrangera) from the government. This is a standard procedure and is typically granted without issue provided the applicant has a clean record and the funds are of legitimate origin. A local legal advisor or 'gestoria' is essential for managing this paperwork.

The Andorran property market offers a range of options from modern apartments in the central parishes of Andorra la Vella and Escaldes-Engordany to traditional 'bordas' and ski chalets in the mountain parishes of La Massana Ordino or Canillo. Prices vary significantly depending on location size and quality.

When you find a property you will typically sign a commitment to purchase agreement (Contracte de Promesa de Compra-Venda) and pay a deposit usually around 10% of the purchase price. The final deed (Escriptura Pública de Compravenda) is signed before a public notary at which point the remaining balance and associated transaction costs are paid.

Buyers must budget for transaction costs on top of the property price. These include a property transfer tax notary fees and registration fees. The exact percentages can change and should be confirmed by your legal representative. Understanding the best way to structure your purchase is key perhaps using a specialised holding company for your foreign property which can have tax and inheritance benefits.

The Tax System in Andorra

Andorra transitioned from a tax-free haven to a low-tax country in the last decade introducing a modern competitive tax framework that complies with international standards. This transparency has enhanced its reputation as a stable and reliable financial centre.

Personal Income Tax (Impost sobre la Renda de les Persones Físiques or IRPF) is levied on the worldwide income of tax residents. The structure is progressive and highly favourable:

• The top rate of personal income tax is 10%. Check the lower bands and allowances with the Andorran tax authorities.

Andorra's system is residency-based meaning you must understand the distinction between tax residency and legal residency to plan effectively.

Crucially for high-net-worth individuals Andorra does not levy a wealth tax. Furthermore there is no gift tax or inheritance tax between parents and children or between spouses. This makes Andorra an extremely efficient jurisdiction for inter-generational wealth transfer. While it is not a pure territorial tax country its combination of a low headline rate significant exemptions and no wealth or inheritance tax makes its overall tax burden one of the lowest in Western Europe.

Corporate tax is also set at a maximum of 10% creating a pro-business environment that further supports the principality's economic stability.

For the wider context, read our full what is a golden visa? every active programme compared (2026).

How to Apply for Andorran Passive Residency: Step-by-Step

The application process for Andorran passive residency is meticulous and requires careful document preparation. Using a reputable local advisory firm or 'gestoria' is highly recommended to ensure a smooth process.

1. Initial Consultation and Preparation The first step is to engage with an advisor to confirm your eligibility and decide on your qualifying investment. You will begin gathering the necessary personal documents which will all require official translation into Catalan and an Apostille stamp.

2. Open an Andorran Bank Account You must open a personal bank account in Andorra. This is a prerequisite for making the investment and lodging the AFA deposit. Andorran banks perform thorough due diligence and will require detailed information on your source of wealth.

3. Obtain Government Authorisation for Foreign Investment If your chosen investment is property you must first apply for and receive government permission to buy it as a foreigner. Your legal advisor will handle this submission.

4. Prepare the Residency Application Dossier Your advisor will help you compile the complete application file. Key documents typically include: valid passport and birth certificate criminal record certificates from your country of birth nationality and all countries of residence marriage certificate if applicable proof of private health insurance for Andorra and proof of address.

5. Submit the Application and Attend an Interview The application must be submitted in person to the Andorran immigration service (Servei d'Immigració) in Andorra. You will attend a brief interview as part of this process.

6. Undergo a Medical Examination All applicants are required to complete a medical examination with a designated doctor in Andorra. This is a standard part of the immigration process to confirm you are in good health.

7. Make the Investment and AFA Deposit Once your application receives preliminary approval you will have a set timeframe to finalise your €1 million investment and make the required non-interest-bearing deposit to the Andorran Financial Authority (AFA).

8. Receive Your Residency Permit After the immigration department receives confirmation of your investment and deposit from the AFA your residency permit (residence card) will be issued. The initial permit is typically valid for one year and is subsequently renewed for longer periods provided you continue to meet all the conditions.

Frequently asked questions

How long does the Andorran residency process take?

The entire process from initial consultation to receiving your residency card typically takes between three to six months. The timeline can be affected by how quickly you can gather the required documents open a bank account and the processing times at the Andorran immigration department. It is wise to start well in advance of your intended move.

Can my family be included in the application?

Yes the main applicant for passive residency can include their spouse or civil partner and dependent children. You will need to provide additional documentation like marriage and birth certificates for each family member and prove you have sufficient financial means to support them with the amount per dependant set by the authorities, so check the current figure.

Is Andorra in the Schengen Area?

No Andorra is not part of the EU or the Schengen Area. While it has open borders with France and Spain residents who are non-EU nationals may need a multiple-entry Schengen visa for travel within the wider Schengen zone depending on their passport. The residency card grants free movement into Spain and France.

What is the minimum stay requirement for Andorran residency?

To maintain passive residency status you must physically reside in Andorra for a minimum of 90 days per calendar year. This is less than the time many other countries giving residents a great deal of travel flexibility while still enjoying the benefits of Andorran residency.

Can I work in Andorra with passive residency?

No the 'residence without lucrative activity' permit expressly prohibits you from being employed by an Andorran company or holding a salaried executive position. Your income must come from passive sources such as investments pensions or business activities conducted entirely outside of Andorra. Other permit types exist for those wishing to work or run a business locally.

Does Andorran residency lead to citizenship?

Yes it is possible but the path is very long. An individual can apply for Andorran citizenship after 20 years of continuous residency. This can be reduced to 10 years if the applicant has graduated from an Andorran school. Andorra does not recognise dual citizenship so you would be required to renounce your previous nationality.

What are the main benefits of living in Andorra?

The key benefits are a very low tax environment with a 10% top income tax rate and no wealth or inheritance tax. It also offers an extremely high quality of life excellent healthcare low crime rates political stability and stunning natural landscapes. Its location provides easy access to both Spain and France.

Is knowledge of Catalan required for residency?

While Catalan is the official language and some basic knowledge is encouraged upon renewal there is no strict language test for the initial passive residency application. However basic knowledge of Catalan French or Spanish is highly beneficial for daily life. The government provides free Catalan language courses to all residents.

Are there other types of residency in Andorra?

Yes besides passive residency there is also 'active residency' for those who want to work for an Andorran company or establish and actively manage their own business in the principality. There are also specific permits for individuals recognised for their scientific cultural or sporting achievements. Each has a different set of requirements and obligations.

What happens to my investment if I give up residency?

Your main qualifying investment such as property or shares remains your personal asset and you can sell it according to market rules. Your non-interest-bearing deposit held with the Andorran Financial Authority (AFA) is fully refundable once you formally cancel your residency and prove that you have no outstanding debts or obligations within Andorra.

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Sources

• Government of Andorra (Govern d'Andorra): govern.ad
• Andorran Financial Authority (AFA): afa.ad