Passive residence in Andorra under the 2026 rules

Residence in Andorra is regulated by the Qualified Law on Immigration (Law 9/2012) and managed by the Immigration Service of the Government of Andorra. Passive residence is designed for people who will live on their own means and not work in the country. Holders must have their principal and effective residence in Andorra for at least 90 days a year, hold health insurance covering Andorra, have no criminal record and show resources sufficient to support themselves and their dependants. The authorisation is renewable, provided the investment and the presence requirement are maintained.

The rules were tightened twice in quick succession as Andorra tried to cool housing demand. The 2025 omnibus law for sustainable growth and the right to housing (Law 5/2025) raised the investment from EUR 400,000 to EUR 600,000. Law 2/2026, approved by the General Council on 22 January 2026, then amended Article 96 of the Immigration Law. Applicants must now commit to invest at least EUR 1,000,000 in Andorran assets within six months of filing (extendable for force majeure): real estate, shares in Andorran companies, Andorran public debt, Andorran life insurance, non-remunerated deposits at the AFA, or Andorran financial instruments and collective funds, the last of which may be held for no more than 36 months before being redeployed. Each property counted must involve more than EUR 800,000. The threshold falls to EUR 400,000 when invested permanently in the national Housing Fund. On top of the investment, EUR 50,000 for the holder and EUR 12,000 for each dependant are paid through the Andorran Financial Authority (AFA) to the State and are no longer refundable.

Andorra's tax system is a key reason families relocate. Under the personal income tax law (Law 5/2014), a person is tax resident if present more than 183 days in a calendar year or if the main base of activities or economic interests is in Andorra. The first EUR 24,000 of general income is exempt, income up to EUR 40,000 bears an effective 5%, and the rate above that is 10%. There is no wealth tax and no inheritance or gift tax, and Andorra has double tax treaties with Spain, France and Portugal, among others. A passive resident spending only 90 days a year must check that tax residence has genuinely ended in the former home country. Non-resident foreign purchasers of property also face the foreign real-estate investment tax, now 6% on a first home and 10% on further units.

Spouses or partners, children and other dependants may join the main applicant, each attracting the EUR 12,000 payment. Those who wish to work choose active residence instead: self-employed residence requires owning more than 34% of an Andorran company, sitting on its board and paying EUR 50,000 to the State, waived for qualifying high-technology digital projects, and implies living in Andorra most of the year. Citizenship is distant. Naturalisation generally requires 20 years of effective residence; a 2026 amendment allows non-consecutive periods to count, and applicants must show Catalan and knowledge of Andorran institutions and renounce their previous nationality, since Andorra does not generally permit dual nationality.