New passive residents who wish to move to Andorra must pay a large cost to do so. This new law was recently approved by the Andorran government. Initially, the proposal was for 800.000 euros, but finally it was set at 600.000 EUR.
If you want to know more about this increase for new passive residents of Andorra, read on. We will explain what the initial proposal was and why it was not accepted.
Previously, the amount to be paid by new passive residents in Andorra was 400,000 euros. This was not as high as in other countries on the European continent. However, the head of government proposed to increase this amount to 800,000 euros. Which is rather high for someone who is coming new to a country where he does not have a fixed source of employment.
The reason why the head of government made this decision is that they want to decrease the number of new residents in the country. Since, in the last few years, many people have come to Andorra to ask for a passive residence permit.
The 800,000 euros will be put on deposit or can be invested in products, such as real estate or companies. However, the government will impose certain limitations for investments in real estate.
Something important to highlight is that those immigrants who come to the country under contracts with companies will not have to pay this tax. They are totally exempted from it. On the other hand, for people who wish to come to Andorra as self-employed, the tax has also increased. This goes from 15,000 to 50,000 euros.
At this point you may think that it is no longer so feasible to go to Andorra as a passive resident. However, it is still one of the European countries with the lowest taxes and many opportunities to grow.
As mentioned above, the initial proposal to be paid by new passive residents in Andorra was €800,000. However, the Andorran parliament did not approve this proposal. Therefore, thanks to this decision, it was decided that it should be 600,000 EUR.
One of the considerations taken into account to decrease the value of this amount was to make a staggered increase. This is so that new residents would not be completely deterred from the idea of coming to Andorra.
On the other hand, if you decide to make an investment in the housing area selected by the Government, you only have to pay 400,000 euros. In other words, you will be able to get a reduction of up to 200,000 euros in tax. This can be a great opportunity for you, if you do not have the full amount of 600.000 EUR.