Introduction
Andorra passive residency: the government has decided to maintain the required minimum contribution for this type of permit at €800,000, a decision that affects investors, families, and professionals considering moving to Andorra. In this article, we explain what the measure means, how it differs from the initial proposal by Concòrdia, and how it can influence your relocation plans, taxes, and real estate decisions.
What has the government approved and why does it matter
The government’s measure sets the minimum investment for obtaining passive residency in Andorra at €800,000. This amount refers to the required investment—whether in assets, projects, or property—that accompanies the permit application. The decision is part of the debate regarding the role of foreign capital in the real estate market and the local economy.
It is important to distinguish Andorra passive residency from other types of residency (employment as an employee or self-employed). Passive residency is designed for individuals who establish their fiscal residence in Andorra without engaging in employment activity within the country.
Differences with Concòrdia’s proposal
Concòrdia proposed stricter requirements: a minimum investment of one million euros for passive residents and an explicit prohibition of investing in real estate to meet the requirement. The government rejected this exclusion and chose to retain the possibility of investing in properties, setting the minimum contribution at €800,000.
In parallel, for residence and work permits for self-employment, Concòrdia proposed a minimum investment of €250,000 with €50,000 as a grant; the government suggests lowering that amount to €30,000 as a grant to facilitate business creation and economic activity.
Impact for those wishing to move to Andorra
If you are considering applying for Andorra passive residency, this decision directly affects your financial planning and the type of investment you need to demonstrate. Maintaining the figure at €800,000 allows you to:
- Continue using real estate investment as a valid pathway for passive residency.
- Design mixed investment strategies (financial assets + real estate).
- Avoid immediate legal changes that could restrict the real estate market to non-residents.
However, the amount remains high, and many families will opt to supplement the investment with other asset types to justify the contribution.
Taxation and fiscal advantages
Andorra passive residency offers a competitive tax environment: reduced income taxes, absence of certain taxes present in other countries, and a stable fiscal system. For those considering relocating, it is essential to evaluate the relationship between the required contribution and the fiscal benefits in the medium and long term.
If you wish to delve into tax aspects before making decisions, consult our guide on taxes in Andorra or the page on residency in Andorra for specific steps.
What types of investments are accepted?
With the current regulation—which maintains the minimum investment at €800,000—several modalities are accepted to demonstrate the contribution:
- Purchase of real estate in Andorra (homes, commercial premises, etc.).
- Investments in local companies or projects.
- Financial assets or funds registered in the country.
The flexibility to accept real estate facilitates access for those seeking to live in Andorra combining residency and housing. If you need advice on organizing your move, review moving to Andorra.
Practical steps for passive residency aspirants
If you plan to apply for Andorra passive residency, follow these general steps—additional documentation may be required for each case:
- Analyze and document the investment that will form the basis of your application (real estate, project, or assets).
- Hire specialized legal and tax advice to structure the operation and optimize taxes.
- Prepare personal documentation and demonstrate economic and social ties in Andorra.
- Initiate the administrative process and meet the stay and presence requirements mandated by law.
At Andorraway, we offer practical support for relocation and administrative procedures. Explore our services on living in Andorra and contact us through our contact page for a personalized assessment.
Stay requirements and other conditions
Andorra passive residency requires complying with certain residence periods and demonstrating that the economic and personal interests are centered in the country. Additionally, it may be necessary to prove insurance coverage and fulfill administrative obligations such as registration and opening local bank accounts.
Advantages and risks to consider
Among the benefits of Andorra passive residency are:
- Significant tax advantages compared to many European countries.
- High quality of life and services (healthcare, education, safety).
- Access to a stable real estate market and the local business fabric.
However, there are also risks and costs:
- The need to mobilize a substantial capital (€800,000), which may involve financing and transaction costs.
- Administrative and permanence requirements must be met to maintain residence.
- Possible future regulatory changes that could alter conditions for new applicants.
Frequently Asked Questions
Can I meet the investment with real estate?
Yes. Unlike the proposal that aimed to ban real estate investment, the current regulation allows the €800,000 contribution to be demonstrated, among other ways, through the purchase of property in Andorra.
Does Andorra passive residency require residing in the country all year?
Not necessarily all year, but there are presence and fiscal ties requirements that mandate clarifying Andorra as your primary residence and main economic center.
How does it affect self-employment work permits?
The government has proposed reductions in the amounts required as grants, seeking to facilitate the creation of local companies and projects. Check the related services section for practical steps if planning to work or start a business in Andorra.
Conclusion and recommendations
The decision to keep the minimum contribution for Andorra passive residency at €800,000 provides certainty for those considering changing their fiscal residence to the country, but requires planning in advance the investment structure. Our advice for those considering this step:
- Perform a personalized financial and tax study before investing.
- Evaluate combinations of assets that justify the contribution without concentrating all capital in a single asset type.
- Seek professional support for moving logistics and integration into services (healthcare, education): healthcare system, education in Andorra.
If you need advice for processing Andorra passive residency or organizing your relocation and investment optimization, at Andorraway we accompany you throughout the process. Contact us at https://andorraway.com/en/contact/ for a personalized consultation.
Andorra passive residency: with the contribution set at €800,000, the door remains open for investors and families seeking a competitive fiscal residence without renouncing real estate or local project investments.