Information as of 11 November 2026.
Before you set up an Andorran company, decide whether you’ll stay based abroad or move to Andorra to run the business. If you’re moving, the company and the residence permit follow separate procedures. Start planning both at the same time so the incorporation fits the immigration deadlines.
Ownership and share capital
A non-resident can own 100% of an Andorran company without a local shareholder, subject to prior foreign investment approval. If you are buying a small stake in an existing company, there is a narrow exception. Approval is generally unnecessary if your resulting stake is 10% or less of the share capital or voting rights and total foreign ownership of the capital is below 25%. The investment still has to be declared.
For a typical owner-managed business, a limited liability company (SL) is the usual starting point. It requires €3,000 in share capital and can have a single shareholder, in which case it is an SLU. A public limited company (SA) requires €60,000. Andorra’s standard corporate income tax rate is 10%.
From reserving a name to opening for business
1. Get an identification number and reserve the company name. A non-resident individual needs an Andorran administrative identification number (NIA). When you apply to reserve the name, you’ll also describe what the company will do. That description should match the activities you later put in the articles of association and the business licence application. The name reservation is valid for six months, so keep an eye on that date while the other steps are underway.
2. Apply for foreign investment approval. Explain who will own and ultimately control the company, what it will do in Andorra and where the investment funds will come from. A clear description of how the business will operate helps the ministry assess the application. Gather your source-of-funds documents before you file, especially if you need to obtain them from abroad.
3. Pay in the capital and sign the incorporation deed. For a cash contribution, arrange an account for the company in formation with an Andorran bank and obtain a certificate confirming the payment. Sign the deed before an Andorran notary within the period stated in your approval. If the approval specifies no deadline, you have six months from the date of approval. The notary sends the deed to the Companies Register, and the company comes into legal existence on registration.
4. Apply for the business licence. For a commercial activity, start with the parish authority (comú) where the business will operate. If you need premises, check that they can be licensed for your activity before signing a lease. Some activities also require sector-specific approvals.
How long approval takes
The ministry has two months to decide on a foreign investment application and can extend that by up to one month. If it requests more documents, the decision clock pauses and you have ten working days to respond. The law treats the application as refused if the ministry misses its decision deadline or you miss the deadline to supply the requested documents. Allow time for banking, the notary and licensing when planning your opening date.
If you want to live and work in Andorra
If you plan to apply for residence and work as a self-employed person (residència i treball per compte propi) through your company, apply for a reservation under the permit quota before starting the foreign investment application. You then have six months from filing the reservation request to submit the required evidence, including the investment approval and proof of incorporation. Once you file the permit application, you also have up to three months to show that the company has a registered business operating in Andorra.
You must hold more than 34% of the company, sit on its governing body and actively direct and control the business. The route generally requires a €50,000 payment when you file the initial permit application. The payment is refunded if that application is refused and becomes non-refundable once the permit is granted. Some qualifying projects are exempt.
What to plan for after incorporation
Put the annual accounts and tax returns on the calendar from the outset, even if you expect a slow start. For a company whose financial year ends on 31 December, the filing deadline for annual accounts and the corporate income tax return is generally 31 July. Keep the company’s beneficial ownership information up to date as well.
A company with foreign direct investment must begin genuine economic activity within 18 months of incorporation. Be prepared to show that the business is registered to trade and meets the financial benchmarks for its activity. These draw on the turnover, spending, investment or asset figures in your original application. The authorities can also open dissolution proceedings against an inactive company with no employees if it has missed at least two of the required filings over two consecutive financial years.
Free guide: setting up a company in Andorra 2026. Structures, permits and first steps. Get the free guide.
RANKRE helps with foreign investment approval, incorporation, business licensing and domiciliation. If you are setting up the company as part of a move to Andorra, we can help you plan the company and residence applications together.
This article is general information, not legal or tax advice. Rules change; check current official sources.
