New tax system

New Tax System for Corporate reorganisation in Andorra

Law on the tax scheme applicable to corporate reorganisation transactions and introducing amendments to the Corporation Tax and Personal Income Tax Laws, among others.

TAX Department
New tax system

In November 2017 the tax system for corporate reorganisation transactions was passed, which, for the first time ever, permits merger, spin-off, security exchange, non-monetary contributions of activity branches or other assets and asset return transactions to be carried out in Andorra at no tax cost, provided they comply with the provisions of the above-referred Law.

These transactions are important to energise our economy and we are aware that many of our clients and other interested parties were waiting for this moment to arrive in order to reorganise their assets, businesses or companies. For this reason, Crowe Horwath Alfa Capital has considered it appropriate to attach to this newsletter a summary of the above Law, with its main changes and effects, and about how to proceed in order to carry them out.

The new Law includes relevant modifications related to Andorran taxes (to adapt them to an international tax setting), including Corporation Tax, Personal Income Tax, Capital Gains Tax on immovable asset transfers or the Tax System Regulations Law. The document includes the principal changes and modifications in these taxes.