Taxation of sportspersons in Andorra

Over the last decade Andorra has become one of the main destinations for elite sportspersons in Europe.

What factors make Andorra such an attractive destination for this group of residents? The answer lies in an ideal combination of elements including: quality of life, geographical location, and an attractive tax framework that is competitively and internationally recognised.

In addition, Andorra's mountainous geography favours training at high altitude, which has numerous advantages for sporting performance.

Obtaining a residence permit

There are specific requirements for obtaining a residence permit in Andorra for professional sportspersons. There is a special type of passive residence for scientists, artists and internationally renowned sportspersons. This type of residence requires the following main requirements from the sportsperson, among others:

• proof of having obtained international recognition in the world of sport;
• reside permanently and effectively in Andorra for at least 90 days a year;
• make a non-remunerated deposit of 47,500 euros for the main holder of the residence and a deposit of 9,500 euros for each dependent residence of the main holder (spouse and children);
• take out private health insurance;
• have a dwelling at one's disposal;
• accredit the income generated by the sporting activity during the year prior to the application for the residence permit.

Taxation of elite sportspersons

Professional sportspersons residing in Andorra are subject to the principle of worldwide income. Consequently, income from employment and self-employment generated worldwide, as well as income from intangible assets, is subject to personal income tax, with a maximum tax rate of 10% in Andorra.

It is important to note that most of the income of elite athletes is generated in jurisdictions where sporting competitions or events take place. Andorra currently has a growing network of Double Taxation Avoidance Agreements (DTAs). Andorra also offers its tax residents a series of tax advantages that facilitate proper planning, taking advantage of local and international opportunities. This makes Andorra an option for a country of residence with significant long-term advantages in terms of financial planning and preparation for retirement.

In summary, Andorra represents an attractive residence destination both from an economic point of view and in terms of sports training. In addition, it offers a safe and private environment for the personal lives of elite international sportsperson.

This information is provided for informational purposes only and does not constitute any recommendation or legal advice. It is based on the regulations in force at the time of writing.

At Carlota Pastora Advocats we will be happy to answer your questions about the taxation of sportspersons in Andorra and everything involved in the correct planning of an expatriation process.