Law 5/2014, Of 24 April, The Tax On Income Of Individuals

Original Language Title: Llei 5/2014, del 24 d’abril, de l’impost sobre la renda de les persones físiques

Read the untranslated law here: https://www.bopa.ad/bopa/026030/Pagines/8627A.aspx

Law 5/2014, of 24 April, the tax on income of individuals since the General Council in its session of the 24th of April 2014 has approved the following: law 5/2014, of 24 April, the tax on income of individuals and exhibition. Proof of income tax of individuals The new tax aims to complete the configuration of the Andorran fiscal framework in the area of taxation on income, once implemented the tax levied on business income, both individuals and companies, as well as the incomes of non-tax residents.

Although the tax system of the Principality of Andorra there are certain types of income tax levied figures obtained by physical persons-residents, such as the tax on income of economic activities or the tax on the capital gains on the transfer of real estate, it is absolutely necessary, to complete the task of providing the country a modern fiscal framework and comparable with that of other countries of the , to establish a global tribute that comprised the entirety of the incomes obtained by individuals residing in the Principality of Andorra.

The creation of a tax on income of individuals who understand under your fingertips all the income obtained by the Andorran tax residents is a result of the need to make the constitutional mandate under which all people have to contribute to the public expense, according to their economic capacity, in the framework of a fair tax system , based on the principles of Government and equitable distribution of tax burdens.

At the same time, this law constitutes a basic pillar of the process of economic opening of the Principality, insofar as it involves the creation of a tax on the income of natural persons is on par to the existing in other countries of its environment, the European Union and the OECD.

This tax allows the Principality have a tax system understanding of the full spectrum of income and tax payers which, either by their origin or residence, are under the fiscal sovereignty of the Principality of Andorra. The existence of this fiscal framework will allow the Principality placed in an optimal way for the signing of international agreements, in order to avoid double taxation; These are instruments that constitute an essential tool for attracting foreign investment in our country and to internationalize the Andorran company.

The purpose of approval that must serve as a basis for signing the agreements would not be possible without the existence of a law such as this, which creates a tax and, at the same time, allows us to establish a fiscal framework in the field of direct taxation, on a par with those of the most advanced countries in the world.

II. Guiding principles and structure of the tax As it has already been advanced, an income tax of individuals that aspire to be comparable with those of the most advanced countries of the world must be a tax with a global reach, comprehensive of all of the income that you can get the required tax law, regardless of their type and their source.

First, the definition of the subjective scope of the tax is based on the concept of "fiscal", as a determinant of the condition of forced consistently with the tax stipulated in the tax laws of most of the tax systems of most developed countries in the world. Secondly, the objective of the tax includes all the income that the tax must obtain both the generated in the Andorran territory as they are foreign source. Therefore, set up a tax burden on the "world income" of the tax obligation, including, therefore, the total amount of income you have obtained, in line with the model followed for the most part by the surrounding countries, the European Union and the OECD.

The tax has been conceived with an essential objective: ensure simplicity and clarity in its configuration, and avoid the creation of institutions or complex shapes that can introduce uncertainty of taxable and tax administration at the time to interpret it and apply it.

This dedication to simplicity is embodied in the way the mechanisms that reduce the loads of taxable, with regard to the management and to the fulfilment of their obligations arising from the application of the tax. In this sense, will minimize the situations in which the required tax is obliged to submit the payment of the tax, he moved this obligation the water absorbent and placed at the service of the latter, in relation to income from work, the tools that the Ministry in charge of Finance has to calculate the deductions and the Caixa Andorrana de Seguretat Social offers to pay them in front of the Ministry responsible for finance.

The income tax is progressive, in order to adapt to the constitutional mandate that people contribute to public burdens according to the contributory capacity. Although the tax rate is fixed, the progressive character mentioned is achieved through two mechanisms: first, the introduction of a reduction on the tax base on the concept of minimum staff that lets out a total of 24,000 euros (which increases to 40,000 in some cases) and other additional reductions to compensate for the family of the tax obligation; Secondly, a bonus for the income that is integrated within the general income. Therefore, the progressiveness is achieved with regard to the effective rate of taxation that is for the tax required.


The law contains a number of measures that are intended to be sensitive to the personal and family situation of taxable having given by its members of the family unit (taking into account the possible existence of situations of disability), or who have to deal with the acquisition of the property where you placed your residence, reducing the level of taxation in line with their situation. However the existence of a minimum staff of 24,000 euros for all taxable, it has been thought advisable to supplement this benefit with others that specifically requires the coverage of family situations that may lead to charges for the compulsory tax law; Thus, it is anticipated the increase of the aforementioned reduction of 24,000 euros up to 40,000 when the tax obligation has the spouse or the partner in charge, or the application of reductions related to the existence of descendants or ancestors that part of the tax, increasing the amount required if a situation of disability.

As already pointed out, this law has as one of the main objectives to create a tax comparable with those existing in other countries of the developed world. However, in order to achieve this purpose, the law is highly sensitive to the social and economic reality of the Principality of Andorra, and tries to reflect the particularities of our country, as well as to ensure the establishment of an attractive tax framework to encourage foreign investment and internationalization of the national company.

In the surroundings of the family-owned company, are the law certain measures aimed at ensuring tax neutrality for entrepreneurs who decide to organize its activity through the creation of a company; in particular, the aforementioned exemption of dividends from companies of Andorra. In the same way, in the transmission of shares in companies with a significant level of participation, the tax must be able to enjoy the exemption of capital gains when you owned the shares for a period of at least ten years. At the same time are considered exempt earnings and capital losses arising from the transfer of real estate located abroad where the tax must have held the property for a minimum period of ten years.

Finally, the Tax Law establishes a reduction of 3,000 euros per year for the income of the savings, in order to encourage small savers.

III. Fundamental aspects of the law on the structure of the tax is based on the separation of the two main sections: on the one hand, the general income, which includes income from work, the income from the realisation of economic activities and the income of real estate capital; and, on the other hand, the income of the savings, a concept which includes investment income and gains and capital losses.

Certain types of income are out of the burden for this tax, although technically you can try income included in the scope of the tax:-first of all, certain incomes they enjoy exemption and, therefore, not subject to the burden arising from the application of the tax, either for reasons of fiscal policy (for example, the exemption of certain grants or awards), in consideration of the purpose of compensatory income in question (certain compensation or payments derived from the obligation of food , compensation for dismissal or the termination of the worker), either for technical reasons (for example, the exemption of dividends of the Andorran background, which is justified by the need to avoid economic double taxation). At the same time, that would have been considered exempt some benefits met by public entities in application of social policies in force (pensions of widowhood, orphanhood, pensions, pensions for invalidity).

-Secondly, the tax on income of individuals let out of your field goal capital gains that are subject to the tax on capital gains on the transfer of real estate, which are recorded in accordance with the law regulating this tax.

-Finally, this tax is not levied the income to be obtained by the taxable as a result of the acquisition of property or rights to profit, either because of death or inters, or derive from their status as beneficiaries of life insurance when they are the decision makers.

The determination of the tax has as its point of departure the full amount of each of the types of incomes, which greatly reduces the expenses tax deductible; If necessary, we can integrate the net income in accordance with the said classification, and gives rise to the general tax base and saving.

The rules to quantify yields derived from the realization of economic activities are essentially matching existing ones under the force of the law which governs the income tax of the economic activities. For systematic reasons, it has been considered appropriate to transfer the regulation contained in the law on the tax on the income from economic activities to the articles of this law, although its content is material with minimal changes. The quantification of the gains and losses of capital is made, in general, for the difference between the values of transmission and acquisition.

On the basis of general taxation and savings, the scheme of payment of the tax is completed around the following concepts:-the basis of payment is obtained by applying the existing reductions to the law, when appropriate, on the basis of taxation. These reductions are essential, as are advanced, accommodate the tax burden for this tax at the personal and family situation of the tax obligation. Likewise, it establishes a reduction to encourage savings through the subscription of social instruments.

-The share of taxation is to add the amounts resulting from the application of the tax rate on the basis of general savings and settlement.

-The settlement fee is the result of a reduction in the share of taxation on the tax deductions and bonus provisions of the law.

• in this respect, the law includes deductions for jobs and for existing investments, in the context of the old income tax of economic activities.


• Enter a deduction to avoid international double taxation to mitigate the potential effect of the double taxation arising from the burden of the income tax, which forced the world may have been subjected to tax in another jurisdiction.

• the only bonus provisions of this law is applicable in relation to the payment of tax that comes from the base of general taxation, within a quantitative limit. This bonus operates as a factor which introduces progressiveness in the tax, and reduces the level of effective taxation for income that layered under a certain amount.

• Finally, the differential fee is the amount that the tax obligation has paid or has the right to receive, once deducted the payments on account of the amount of the settlement fee.

The law provides for a detailed regulation of the regime applicable to payments on account of tax, without prejudice to regulatory development need of formal aspects and procedures relating to this obligation.

Finally, included within the articles of the law provisions relating to the management and settlement of the tax scheme of infractions and sanctions, as a result of breaches of the obligations arising from this Act, and a provision relating to the court competent to determine disputes arising from the tax.

At the same time it has created a transitional regime, which aims to facilitate the adaptation to the Andorran tax system of those taxable with the residence permit without lucrative activity on the date of application of this law.

Formally the law is divided into 63 articles, 3 additional provisions transitional provisions, repeal a 4 and 5 final provisions.

Chapter i. nature and scope of application Article 1 nature and scope of application of the tax the tax on income of individuals is a tribute of a personal nature and that record, according to the principles of generality and of equitable distribution of tax burdens, income obtained by natural persons according to their amount and their personal and family circumstances.

Article 2 the object of the tax is the object of the tax is made up of the income tax, understood as the totality of forced their income and gains and losses of capital, irrespective of the place where they have been produced and wherever the residence of the payer.

Article 3 scope of spatial application 1. The tax on income of individuals applies to the whole territory of the Principality of Andorra.

2. The provisions of this Law shall be understood without prejudice to the provisions of treaties and international agreements that have become part of the internal legal system.

Chapter II. Subject to the income tax section one. The fact and the income exempt from Article 4 Done 1 generator. Constitutes the fact generator for the production of income, whatever its source or origin, for part of the tax obligation, irrespective of the place where it occurred and irrespective of the residence of the payer.

2. Make up the income tax: a work income forced).

b) income from the realisation of economic activities.

c) The income of the capital real estate.

d) investment income.

e) earnings and losses of capital.

3. For the purposes of determining the basis of taxation and settlement and in the calculation of the tax, income is classified in general income and savings income, in the following terms: a) form the general income income from work, the income from the realisation of economic activities and the income of real estate capital.

b) form the savings income investment income and gains and capital losses.

4. Are not subject to this tax the following income: a) The gains and capital losses arising from the transfer of goods that are subject to the tax on capital gains on the transfer of real estate.

b) acquisitions of property and rights to inheritance, legacy or any other hereditary title, as well as the acquisitions of goods and rights to donation or any other legal business, free, inters and the perception of amounts for the beneficiaries of life insurance contracts, when the policyholder is a person other than the beneficiary.

Article 5 Income exempt from income tax are exempt from the following: a) compensation as a result of civil liability for personal injury, in the amount legally or judicially recognized. The same treatment is applicable to the compensation paid by the Government of Andorra for personal injury as a result of the functioning of public services.

b) annuities for foods perceived parent or other folks forced to pay them in accordance with the civil legislation of application or in compliance with a court order or in execution of a regulatory agreement legally approved or by protocol·litzat.

c) The perceived economic benefits in accordance with the rules governing social and community health services of the Principality of Andorra.

d) The compensation for dismissal or dismissal of a worker, in the amount established with mandatory under the regulations.

e) public scholarships and grants awarded by private entities, perceived by formal studies, both in the Principality of Andorra as well as abroad, with the conditions to be determined by the regulations.

f) the benefits recognized in the tax required by public bodies or entities that the overriding as a consequence of absolute permanent disability or invalidity.

g) perceived benefits in widowhood pensions met by public entities in application of the legislation in force in the Principality of Andorra.

h) perceived benefits as pensions of orphanhood, met by public entities in application of the legislation in force in the Principality of Andorra.

and the literary, artistic or scientific relevant Awards), with the conditions to be determined by the regulations.

j) dividends and other income derived from the participation in equity, to which reference is made in paragraph 1 of article 22, when they are satisfied by entities tax residents in Andorra or Andorran law collective investment undertakings provided that they are subject to the tax on Andorran companies.


k) earnings and losses of capital obtained as a result of the transmission or the redemption of the shares or participations in any organism of collective investment regulated in the regulations applicable to these organisms as well as the profits and losses of capital obtained as a result of the transfer of securities representing participation in the own funds of institutions When the transmitent, individually or in conjunction with related entities according to the provisions of the law on the tax on companies or with other people linked by kinship ties, including the spouse and the couple in the case of stable partnerships, as defined in the regulations of the stable partnerships, by consanguinity or adoption in downline , ascending or collateral to the third degree inclusive, has not had a greater than 25 percent in the capital, the equity, the results or the voting rights of the entity in the preceding twelve months at the time of the transmission.

However the established in the previous paragraph, also are exempt earnings and capital losses obtained as a result of the transmission of these values when there is a participation, computed in the terms indicated, more than 25 percent in the capital, the equity, the results or the voting rights of the entity in the preceding twelve months at the time of the transmission When the tax obligation has possessed the property of the object values of transmission, at least, during the ten years prior to the transfer.

the) capital gains that are evidenced in the lucrative transmissions for the death of the tax obligation.

m) earnings and losses of capital that is put in the transmission of real estate located outside the territory of Andorra, when the tax obligation has held ownership of these assets subject to transfer, at least, during the ten years prior to the transfer.

n) yields derived from public debt issued by the Principality of Andorra.

Article 6 Presumption of The transfers of property and rights in its various forms will boast paid for its normal value market, except in reverse.

Second section. The taxable taxable Article 7 1. Are taxable the tax individuals who have tax residence in Andorran territory.

2. net income corresponding to the civil societies, inheritance jacents, communities of goods and all entities or autonomous assets regulated in the regulations of the Tax Ordinance, is allocated to its members, heirs, commoners or unitholders in accordance with the regulations or agreements applicable in each case or in equal parts in the absence of these Covenants. These net incomes are included in the basis of taxation of the income tax when these partners, heirs, commoners or participants are taxable to that tax.

The net income that are integrated into the base of taxation are the result of a reduction in the full income obtained by these entities with deductible expenses related to obtaining of these incomes.

These net incomes will qualify according to their nature.

Article 8 Residence tax and tax address 1. Are considered to be "tax-resident in the territory of Andorra" individuals in which will give any of the following circumstances: a) remain more than 183 days during the calendar year, in the territory of Andorra. To determine this period sporadic absences will be calculated in Andorran territory, except that the required certified tax your tax residence in another country.

b) That get in Andorran territory the main kernel or the base of their activities or their economic interests directly or indirectly.

2. Is presumed, except in the contrary, the tax must have tax residence in Andorran territory when, in accordance with the criteria of the previous section, is tax resident in the territory of Andorra the spouse not legally separated, and minor children of age.

3. Are not considered "tax residents in Andorran territory" workers daily move in the Principality from Spain or France and who have been hired by companies tax residents in Andorran territory or permanent establishments of foreign companies in Andorran territory.

4. The Andorran nationals, as well as the spouse not legally separated, and minor children of legal age, having the usual residence abroad by their status as members of diplomatic missions or representations in international organizations are considered to be "tax-resident in the territory of Andorra".

5. The tax domicile of the taxable tax residents in Andorran territory is derived from applying the rules to this effect which are foreseen in the regulations of the tax law.

Article 9 Individualisation of income 1. It is considered income obtained by the tax liable on the basis of their origin or their source, without prejudice, where applicable, of the marital.

2. For the purposes of the provisions of the previous section, the following rules apply: a) The income of the work attributed to the person who caused the right to their perception, with the exception of the pensions and other benefits which attach to the person in favour of whom are recognised.

b) capital income and gains and capital losses, attributed to the person who is the holder in accordance with the precepts of the civil law applicable, of property or rights or income generators of profits and losses.

In the event that payments of income and capital gains and capital losses made to more than one person, these members proportionally in equal parts, but all of them share that corresponds a different ratio.

c) the incomes of economic activities are considered to be obtained by the person who develop the activity by the Organization on their own human and material production factors or any of these factors.

Chapter III. Determination of the income recorded by this tax Article 10 determination of the basis of taxation and the basis of payment 1. The basis of taxation is made up to the amount of personal income tax in the tax period obliged.

2. The basis of taxation is determined, in the terms established by this law, as follows: a) the incomes will qualify and quantified according to their origin.


b) net income is obtained by the difference between the income and deductible costs calculable. The gains and losses of capital will determine, in general, for the difference between the values of transmission and acquisition.

c) integrate and make up for the different income according to its origin and its classification as a general income or savings income, such as they are defined in article 4.

The result of these operations determine the basis of general taxation and savings.

3. The basis of payment is the result of practice, at the base of taxation, the reductions provided for in the second section of chapter V.

Chapter IV. Determination of the basis of taxation Section first. Methods of determination Article 11 methods of determination of the basis of taxation 1. The quantification of the components of the basis of taxation is made, in general, by the direct method of determining.

2. The basis of taxation of the income of economic activities is carried out in accordance with the provisions of article 15, using the direct method of determining the objective determination system and, moreover, the method of determining indirectly.

3. indirect estimation method is applied in accordance with the provisions of the regulations of the tax law.

Second section. Determination of income from work Article 12 full Income from work 1. Have the qualification of labour income all compensation or utilities, whatever their denomination or monetary in nature, or in kind, which may arise, directly or indirectly, of the personal work or the employment relationship and do not have the character of income from economic activities. In particular, they have this consideration: a) wages and salaries.

b) involuntary unemployment ordinary financial benefits.

c) caps in concept of expenses of representation.

d) the DSA and travel expenses, when they are subject to the contribution obligation in accordance with the regulations of the Caixa Andorrana de Seguretat Social.

e) the stock options granted in the framework of an employment relationship.

f) The advance warning, the compensation, as well as any other compensation for dismissal or the termination of the employee.

g) The income received in merit of the exercise of public office and employment.

2. In any case, they are considered income from work: a) the grants.

b) compensatory pensions received by spouses and the annuities for food.

c) The pensions and other similar benefits, public or private, derived from a previous job, when they are received by the same worker.

d) benefits received by beneficiaries of pension plans, when they are received by the participant in the plan.

e) benefits received by beneficiaries of insurance contracts pension commitments instrumentin groups, derived from a previous job, when they are received by the same worker.

f) The income from the delivery of courses, conferences, colloquia, seminars and other similar, except when considered to be income from economic activities.

g) perceived benefits in application of the rules of social and community health services. For these purposes, are not considered income benefits received in repayments satisfied by the Andorran Social security as well as for insurance companies, in order to cover medical expenses, medical, hospital, the internally, as well as the costs of travel and accommodation provided in the law of the Caixa Andorrana de Seguridad Social , as well as its regulations.

h.) the remuneration derived from the elaboration of scientific, artistic or literary works when it gives the right to its exploitation.

Article 13 Net Income of 1. The net income of the work are the result of a reduction in the full income from work in the amount of deductible expenses.

2. deductible expenses Are exclusively the following: a) The Andorran Social security contributions in the part corresponding to the worker.

b) for other expenses, a 3 per cent of the entire income from work, excluded the concepts listed in the letters b), c), d), (e)), f) and g) of paragraph 1 of article 12 and in the letters b), c), d), e) and g) of paragraph 2 of article 12, up to a maximum of € 2,500.

The third section. Determining the incomes of economic activities Article 14 full Incomes of economic activities 1. Are considered to be "full incomes of economic activities" which, proceeding from personal work and capital together, or only one of these factors, imply the Organization on their own human and material production factors or any of these factors of production, in order to intervene in the production or distribution of goods or the provision of services.

2. The tax required to perform the activity of real estate can opt for taxation in accordance with the stipulated in articles 20 and 21, as the income of real estate capital.

This option is exercised in the Declaration that has been presented to this tax and binds the tax during the period in which the tax forced exercise and the two following tax periods.

3. Administrators and members of the governing bodies of companies or other entities apply the provisions of this third section to determine the income corresponding to the remuneration received by these concepts.

4. The income will boast obtained by those who perform in the conventional manner, personal and direct the Organization of the means of production and human resources devoted to the activity. It is considered that these requirements meet the owners of the economic activities, except in reverse.

Article 15 NET Incomes of economic activities 1. In the direct method of determining net income of economic activities are calculated according to the provisions of article 16.

2. In the system of the tax base is calculated objectively applying the rules laid down in article 17.

3. In any case, are valued in accordance with their normal value market goods or services which are taxable give or lend to third parties not linked free of charge or intended use or personal use.

Likewise, when there is a consideration and is notoriously less than the normal value in the market of goods and services, will take this value as a criterion of assessment.

Article 16


Direct determination of revenue from economic activities 1. The determination of the income from economic activities in the form of direct estimation is done in accordance with the rules of the income tax, without prejudice to special rules laid down in this law.

2. Regarding the deduction of costs, will take into account the following rules: a) are tax deductible write-offs in relation to property and rights for the economic activity carried out in accordance with article 10 of the law on the tax on companies. They cannot be subject to deduction of the tax base the depreciation, value corrections or provisions which may be made on the assets or rights that are considered not intended for economic activity.

b) are not tax deductible contributions of taxation that, if necessary, the tax must have been paid to the communal tax on income from tenants and to the communal tax of moment of commercial activities, business and professional.

c) when it is duly accredited, with the appropriate employment contract and the membership corresponding to Social Security, that the spouse or children of the compulsory tax law routinely and continuity in the economic activities developed by this forced, is deducted for the determination of the remuneration stipulated with each of them, as long as they are not superior to those of the market corresponding to their professional qualifications and work accomplished.

d) When the spouse or children of the tax required to perform transfers of assets or rights, accredited by the corresponding contracts, they serve the purpose of the economic activity in question, it follows, for determining the income of the owner of the activity, the consideration stipulated, provided that does not exceed the market value. The burden of proof of this market value corresponds to the employer or professional, and the deduction is denied if it is not possible to prove it.

e) are not tax deductible contributions from the employer or professional to pension plans or social instruments that fulfil a similar role when he is the beneficiary.

Article 17 objective Determination of revenue from economic activities 1. Are taxable the turnover of which in the preceding tax year does not exceed 300,000 euros can be foster the objective determination of the performance of economic activities.

For cases of taxable to develop professional activities, the turnover to be host to the objective determination is 150,000 euros.

In the event that the preceding year has started an activity, for the calculation of these limits the turnover will rise in the year.

2. The option of hosting the objective determination is voluntary. In the case of exercising it, this system will be mandatory for all economic activities that make the tax required. The required tax law you wish to host this system must notify the Ministry responsible for Finance before the end of the previous year which have to take effect, in the terms to be determined by the regulations. Once you have opted for this system, it should be kept during a minimum period of three years. To get out of it by means of a communication to the Ministry waives there needs to be in charge of finances before the end of the previous year which is to take effect. In the case of start of activity, the option to benefit from this system must be made during the month following the date of commencement of activity.

3. The determination of the income from economic activities is done by the sum of the net performance of the activity and the balance, positive or negative, of the extraordinary results obtained for the transmission of fixed assets used in the activity.

4. The performance of the activity is calculated by the difference between the revenues that come from the same activity, calculated in accordance with the rules established by the income tax, and the percentages estimatius of the expenses listed below, depending on the type of economic activity that takes place, applied to the amount of income from the activity. The figure does not include the income from the transfer of fixed assets used in the activity, which is additional to the result of the performance of the activity.

5. The percentages of applicable expenses are as follows: a) in the case of activities that are strictly commercial, deductible expenses is quantified in 80 percent of the income figure.

b) in the case of remuneration to administrators or members of the governing bodies, the deductible expenses is quantified in the 3 per cent of the amount of the remuneration.

c) in other activities the deductible expenses is quantified in the 40 percent of the income figure.

For this purpose, are "strictly commercial activities" that consisting of the delivery of goods without these assets have been the subject of previous transformation on the part of transmitent.

6. In the event that the tax must develop diverse activities, the calculation is done by activity activity and are integrated into a single payment by each tax liable.

7. Are included in the basis of taxation of this regime the acquisitions of assets or rights related to the activity purchased in profit.

8. For regulation will develop the specific obligations of information and presentation of the statements relating to this article.

Article 18 rights and Goods intended for an economic activity 1. Are considered "goods and rights intended for an economic activity" are the following: a) The real estate in which the taxpayer carries out its activity.

b) assets intended for economic and socio-cultural services of personnel at the service of the activity. Not considered to be "designed" the goods for leisure and recreation or, in general, private use of the owner of the economic activity.

c) any other property element that is necessary for the performance of the economic activity. In any case do not have this active consideration of participation in equity or equity of an entity and the transfer of capital to third parties.

d) in the case of heritage elements that serve only partially to the object of the economic activity, the effect is understood as limited to the part of these heritage items that really is used in the activity in question.


2. The affectation or tax of goods and rights to economic activity that will follow as part of the heritage of the positive or negative income tax does not generate required to tax effects.

Except in the case that the tax will produce by reason of termination of the activity, if the transmission to third parties occurs before three years have passed, it is considered that the tax of goods or rights generated income of economic activities positive or negative tax effects.

Section four. Determination of capital income capital income definition Article 19 1. For the purposes of this tax, have the status of "income of the capital" the totality of the utilities or benefits, whatever their name or nature, money or in kind, coming, directly or indirectly, of assets, goods or rights, the ownership of which corresponds to the required tax and that are not intended for economic activities, as these activities are defined in article 14 , performed by the tax obligation.

However, the income from the transfer of the ownership of the assets, even when there is a Pact to reserve domain, are taxed as capital gains or losses, except that by this Act is term as capital income.

2. In any case, have this consideration: a) The income from real estate.

b) investment income and, in general, of the remaining assets or rights holder of the tax obligation.

Article 20 staid real estate capital Income are considered "full income from the ownership of real estate" all that derived from the lease or the Constitution or the transfer of rights or powers of use or enjoyment on these assets, whatever their name or nature and without prejudice to the provisions in article 14.

Deductible Expenses article 21 1. The net income of real estate capital are the result of a reduction in the full income in the amount of the deductible expenses.

2. deductible expenses can be quantified, an option of any of the following criteria forced, following tax: a) deductible expenses can be quantified in accordance with rules for determining the net income in the scheme of direct determination established in article 16.

b) deductible expenses can be quantified in the 40 percent of the amount of the full income, in accordance with the requirements and conditions laid down in article 17.

In the event that the tax must choose determine your tax basis following the method of the letter b), above, must notify the Ministry responsible for Finance before the end of the year prior to the beginning of the tax period in which it is to take effect, in the terms to be determined by the regulations. This option links to the tax obligation for a period of at least three years.

Article 22 Income investment entities are considered "full income from the furniture capital" as follows: 1. The dividends and other income from the participation in the equity of companies. In particular, the term "dividends", in the sense of this precept, includes the income of actions, the actions or the good of enjoyment, the stakes, the parts of the founder or other rights, except those of credit, which allow them to participate in the utilities of an entity to the status of partner, shareholder, partner or participant. Have the same consideration of distributions results from any collective investment organism of Andorran law regulated in the regulations applicable to these bodies.

2. The income from the transfer to third parties of own capital. Have this consideration the interests and any other form of remuneration agreed as remuneration for this transfer, as well as the incomes deriving from the transfer, the refund, the redemption, the redemption or the conversion of any kind of active representative of the collection and the use of foreign capital.

3. Income from operations of capitalization and of contracts of life insurance or disability that is not considered to be income of the work in accordance with the provisions of article 12.

In particular, apply to these income the following rules: a) when you receive a deferred capital, income is determined by the difference between the capital and the amount of the premiums. When the capital received is a consequence of the exercise of the right of redemption, the investment performance is determined by the difference between the amount received as a result of the rescue and the part of the premiums corresponding to the capital received.

b) when you receive immediate annuities, it is considered "investment income" the result of applying in each of the years received the following percentages: 40 percent, when the recipient has less than 40 years.

35 percent, when the recipient has between 40 and 49 years.

28 percent, when the recipient has between 50 and 59 years.

24 percent, when the recipient has between 60 and 65 years old.

20 percent, when the recipient has between 66 and 69 years.

8 percent, when the recipient has more than 70 years.

These percentages are determined at the time of the establishment of the income and remain constant during his term.

c) when you receive immediate temporary income, is considered "investment income" the result of applying in each of the years received the following percentages: 12 percent, when the income tax has a duration less than or equal to 5 years.

16 percent, when the income tax has a duration of more than 5 years and less than or equal to 10 years.

20 percent, when the income tax has a duration of more than 10 years and less than or equal to 15 years.

25 percent, when the income tax has a duration of more than 15 years.

d) when it receives a deferred annuity or temporary, whether income, investment income is calculated by applying, on receipt of the annuity, the corresponding percentages according to the letters b) and c) above. These amounts are increased in the profitability obtained until the time of Constitution of the income.


For this purpose, the profitability obtained until the time of Constitution of the income is determined as the difference between the actuarial financial value of income that was established and the amount of the premiums. This amount is included in income of the capital of the required tax and is integrated in a linear fashion over a period of ten years. However, if this is a temporary income of duration of less than 10 years, the period of integration will coincide with the duration of the rent.

4. The income obtained from the provision of technical assistance, the lease or leasing personal property, businesses or mines that are not considered to be revenue from economic activities.

At the same time, will receive this consideration yields from amounts, of any kind, paid by the following concepts as long as they do not receive the consideration of performance of the work or of economic activities: to) any concession or authorization of use or assignment or license of rights on patents, designs, models and industrial drawings, trademarks, domain names and other distinctive signs of the company, as well as other industrial property rights.

b) any concession or authorization of use or assignment or license of rights on plans, formulas or secret procedures, of rights to information concerning industrial, commercial or scientific experience, including the techniques and methods of business, marketing or the concession of use of industrial, commercial or scientific equipment.

c) Any concession or authorization of use or transfer or license of copyright on literary, artistic or scientific works, including audiovisual productions and programs, applications and computer systems, as well as the neighbouring rights to copyright made by people other than the author.

d) payments for the use of image rights.

Article 23 Income investment NET 1. The net income of the investment are the result of a reduction in the full income in the amount of the deductible expenses.

2. Are deductible expenses the expenses of administration and custody, the commissions of intermediaries, as well as other expenses of a similar nature necessary for the obtaining of such income.

3. To determine the net income as defined in paragraph 4 of article 22, it will be deducted from the full income the expenses required to obtain these net income and, if appropriate, the amount of the damage suffered by the goods or rights of obtaining revenue.

Fifth section. Determination of profits and losses of capital Article 24 Concept 1. For the purposes of this tax, they are considered "gains and losses of capital" the variations in the value of the assets of the tax required to be set out on the occasion of any alteration in the composition, except for the application of this law shall be considered to be income.

2. It is estimated that there is no alteration in the composition of the heritage in the following cases: a) in the case of Division of the common thing.

b) In real transmissions and in the constitutions and assignment of rights made by the spouses to the marital community, as well as the purposes either of the spouses to the other within the framework of the amendment of the conjugal community.

c) On the dissolution of the Association of profits, on the termination of the marital economic regime of participation or the termination of the marital economic regime of separation of property, when legal or taxation ruling will produce awards due to different from the alimony.

d) in the dissolution of communities of property.

In any case, the goods and the rights to which apply the previous letters retain the original acquisition value, without which the circumstance that it describes it implies a modification of the value for tax purposes.

3. At the same time, it is considered that there is no capital gain or loss in the following cases: a) On the reduction of capital. When the reduction of capital, whatever its purpose, gives rise to the depreciation of securities or shares, are considered to be the redeemed shares acquired in the first place, and the acquisition value is distributed proportionally among the rest of homogeneous values remain in the assets of the taxpayer. When the reduction of capital does not affect in the same way all values or the shares owned by the taxpayer, is understood to have referred to the acquired in the first place. However, when the reduction of capital is to the return of contributions, the amount of this repayment reduced accordingly the value of acquisition of values affected, until its cancellation. The excess that may be is considered a dividend. This regime is applicable to the return of the issue premium as well as the other contributions made by the partners, regardless of its purpose.

b) In lucrative transmissions inters of any type of property or rights, provided they are made in favor of persons who are linked to transmitent by links of kinship, including the spouse and the couple in the case of stable partnerships, as defined in the regulations of the stable partnerships, by consanguinity or adoption in downline , ascending or collateral to the third degree inclusive.

In any case, goods or rights subject to the aforementioned transmission retained the original acquisition value, without which the circumstance that it describes it implies a modification of the value for tax purposes.

c) in non-cash contributions of any kind of property or rights in favor of societies in which all shareholders and individuals that provide the goods or rights mentioned have between them a kinship by blood or adoption in downline, ascending and/or collateral up to third grade, or are spouses, or are people who integrate the stable partnerships , as defined in the regulations of the stable partnerships.

In any case, the interests of society irrespective of the contribution received by the person who made the contribution retained, to tax effects, the value of the original acquisition of the goods or rights contributed.

4. Are not considered "capital loss" as follows: a) not justified.

b) which derived from consumption.

c) which derived from transfer profits or liberalitats.

d) which derived from losses in the game.


e) those resulting from the transfer of assets, when the transmitter returns to acquire them within the year following the date of the transmission. The losses will be integrated when the subsequent transmission of the property element.

f) those resulting from stock transmissions or shares admitted to trading on any of the official side markets values defined in the Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004, relative to the markets in financial instruments, when the taxpayer has acquired homogeneous values within the two months prior or subsequent to these transmissions. The losses will be integrated when the subsequent transmission of the property element.

g) those resulting from stock transmissions or entries not admitted to trading on any of the official side of securities markets defined in the Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004, relative to the markets in financial instruments, when the taxpayer has acquired homogeneous values a year earlier or later in the transmissions. The losses will be integrated when the subsequent transmission of the property element.

Article 25 Calculation 1. The amount of the profits or losses of capital is: a) in the case of transmission charges or lucrative, the difference between the values of acquisition and transmission of heritage.

b) In all other cases, the real value of the assets or their parts, if necessary.

If you have carried out works to improve the heritage transmitted, unlike the transmission value corresponding to each one of its components.

2. In the transmissions of values of the participation in the own funds of institutions, when they exist, are considered homogeneous values the tax obligation has passed on the values that have been acquired in the first place. For the purposes of determining the value of the acquisition, the tax must be considered the individual cost of homogeneous values acquired or their weighted average cost. The application of both methods in the determination of the value of acquisition of a transmission of values means that you have to use the method of calculation of the cost of acquisition chosen, at least, until the transmission of all homogeneous values.

Article 26 Transfer charges 1. In the transmission charges form part of the value of acquisition: a) the actual amount paid on the acquisition.

b) the amount of the investments or improvements made on the good object of transmission.

c) expenses and taxes inherent to the acquisition satisfied by the acquirer, excluding interest and indirect taxes which have been tax deductible.

2. In the case of real property, the value of the acquisition to which the preceding paragraph refers is updated by multiplying it by the coefficients of update that are established in the law of the general budget, and determined in function of the years in which the property has been in the property of the tax obligation.

3. The value of the item, the subject of the transmission is the actual amount paid, provided that normal value is not lower than that of the market, in which case the latter prevaldria. The value of the transmission is deducted the expenses and taxes to which reference is made to the letter c) of paragraph 1, if they have been satisfied by the acquirer.

Article 27 Transmission to profit When the acquisition or transmission have been carried out for profit, apply the rules set out in paragraph 1 of article 26, considering as the real value of the elements transmitted its normal value market.

The sixth section. Special rules of assessment Article 28 Evaluation of operations the appraisal of operations between the taxable subject to this tax, and other individuals or entities is carried out by the normal market value, in the terms provided in the law on the tax on companies.

Article 29 Income in kind 1. They are considered as income in kind the use, consumption, or obtaining, for individuals, goods, rights or services free of charge or for a price lower than the normal market, although I don't suppose a real expense for those who give.

2. Not considered labour income in kind: a) deliveries to employees of products at low prices that are carried out in dining rooms or economats.

b) the premiums or fees paid to insurers under insurance contract of work-related accident or worker's civil liability.

c) The provision of the service of education for educational centres allowed the children of their employees.

Section seven. Integration and compensation of income Article 30 integration and compensation of income 1. For the calculation of the tax base, the positive or negative amount in the income of the tax must integrate and offset between them according to the stipulated in this article.

2. In accordance with the classification of the provisions in article 4, the tax base is divided into two parts: a) general tax Base.

b) based on taxation of savings.

Article 31 general tax Base 1. The basis of taxation is the result of integrating and compensate for each other, in each tax period, the income from work, the income from the realisation of economic activities and the income of real estate capital.

2. If after the integration and previous compensation is a negative amount, you can offset the positive amount of general taxation base resulting in the ten following tax periods.

Article 32 the basis for taxation of savings 1. The basis of taxation of savings is the result of integrating and compensate for each other, in each tax period, investment income and gains and capital losses.

2. If after the integration and previous compensation is a negative amount, you can offset the positive amount of the basis of taxation of savings resulting in the ten following tax periods.

V. determination of the basis of payment Section first. Basis of general savings and settlement Article 33 payment basis general 1. The basis of the general settlement is the result of a reduction in the positive balance of the general taxation base in the amount of the reductions provided for in articles 35, 38 and 39.

2. The reductions mentioned in the previous section are applied in the following terms: a) Firstly, apply the reductions in personal and family the article 35.


b) in the event that, once applied personal reductions and family, the basis of taxation has positive balance, apply the discounts for purchase of housing and for contributions to systems of social prevention and compensatory pensions contained in articles 38 and 39.

3. The amount of the basis of the general settlement cannot be negative as a result of the application of the reductions indicated in the previous sections.

Article 34 payment basis of saving 1. The basis for settlement of the savings is determined by the reduction of the positive balance of the basis of taxation of savings in the amount of the reduction provided for in article 37.

2. The amount of the basis for settlement of the savings cannot be negative as a result of the application of the reduction indicated in the previous section.

Second section. 35 Article reductions reductions in personal and family 1. Reduction to minimum exempt staff Are taxable can reduce the general tax base, in concept of reducing to minimum exempt staff, in an amount of € 24,000.

This amount is increased to 40,000 euros when the spouse does not separate from the tax liable or his stable partner, as defined in the regulations of the stable partnerships, who lives with the required non-tax register any type of income that is to be included in the base of general taxation.

When the spouse does not separate or the partner of the tax income that is required to obtain integrated within their general tax base and the amount of this tax base won't allow it to apply in full the 24,000 euros corresponding to the reduction provided for in the first paragraph of this section 1, the remaining amount of the reduction may be applied, if applicable, for the same tax obligation without the joint amount of reduction applicable to both spouses or partners may exceed the amount of 40,000 euros.

2. Reduction for dependent family members Are taxable can reduce the base of general taxation in the following amounts: a) 750 euros for each descendant to be under 25 years of age at the date of accrual of the tax and that they live together with the required annual income tax and not dependent on time or over 12,000 euros.

b) 750 euros for each ascending 65 years whichever is greater than the date of accrual of the tax and that they live together with the required annual income tax and not dependent on time or over 12,000 euros.

The reductions provided for in the letters a) and b) is increased by application of a coefficient of 1.5 on the amount for each descending and ascending with disabilities who lives with the required tax law or depend on.

For the purposes of this tax, are considered "persons with disabilities" which are subject to the scope of application of the law on guarantees of the rights of persons with disabilities.

3. When two or more taxable have the right to the application of the reductions provided for in paragraph (2) in respect of the same ancestors or descendants, the amount of the reductions is prorrateja between them in equal parts. However, when the tax is deemed to have made a different degree of the ascendant or descendant, only have the right to the nearest degree reduction.

Article 36 standards for the application of the personal and family minimum 1. When the tax period is lower than the calendar year, the minimum staff prorrateja by the number of days of the period of tax in respect of the calendar year.

2. for the application of the least familiar personal and family circumstances are taken into account at the time of incurrence of the tax.

However, in the event of death of a descendant that gives the right to the application of the least familiar, its amount is prorrateja by the number of days during which meet the requirements for your application.

Article 37 Reduction to exempt from the income of the savings the basis of taxation of savings is reduced in an amount of € 3,000 exempt to obtain income from savings.

Article 38 Reduction to investment in residence 1. The taxable base can reduce the tax in an amount equivalent to 25 per cent of the amounts paid in the tax period for the acquisition of the property that constitutes or constitute his residence, including the expenses caused by the acquisition by the purchaser and, in the case of third-party financing, depreciation, interest and other costs associated with the loan.

The maximum amount of the reduction is 1,000 euros per year.

2. When the transmission of a residence has generated a capital gain that you have enjoyed the exemption for reinvestment in the tax on capital gains on the transfer of real estate, the basis of the reduction for the acquisition of the new housing will be reduced accordingly in the amount of the capital gain to which it applies the exemption for reinvestment. In this case, you can practice reducing for the acquisition of new housing while the inverted quantities in the same housing does not exceed the exempt capital gain for reinvestment.

3. Is included in the concept of the housing estate which is the usual and permanent housing, parking, storerooms and the annexes to the latter if accessories are purchased together.

4. Because housing is their usual residence, the tax obligation must be registered in the register of the parish corresponding to the place of location of the property within the period of twelve months from the date of acquisition of the property.

In the event of failure to comply with this requirement, the tax must have to enter the amount of the reduction applied, together with the late payment penalty, in the tax period in which the non-compliance occurs.

Article 39 discounts for contributions to social instruments and compensatory pensions 1. The contributions and contributions to pension plans and other instruments of social skills to the legislation of the Principality of Andorra, both made by the same companies forced to tax in favour of their employees can be an element of reducing the tax fee. The maximum amount deductible may not exceed the lesser of the following amounts: a) the 30 to 100 of the sum of the net income of the work and of the economic activities.

b) 5,000 euros a year.


2. compensatory pensions satisfied in favour of the spouse and the food shows satisfied both in accordance with the civil legislation of application or in compliance with a court order or in execution of a regulatory agreement legally approved or by protocol·litzat.

Chapter VI. Tax period, accrual and imputation of income Article 40 tax Period 1. The tax period coincides with the calendar year.

2. The tax period is lower than in the calendar year if the death of the tax required on a day other than December 31. In this case, the tax period ends on the date of death.

Article 41 Accrual of the tax the tax is payable on the last day of the tax period.

Article 42 imputation of income 1. Income and expenses determine the income that must be included in the basis of taxation is allocated to the tax period that corresponds, in general, in accordance with the following criteria: a) labour and capital income is allocated to the tax period in which they are required, or his collection if this payment is above.

b) incomes of economic activities is allocated in accordance with the regulations of the general accounting plan.

c) earnings and losses of capital is allocated to the tax period in which takes place the asset impairment.

2. Without prejudice to the provisions of the previous point, in cases that are below the income is allocated to the appropriate tax period in accordance with the following special criteria: a) When it has not satisfied the whole or part of an income to meet pending judicial resolution to your perception or its amount, the amounts are not satisfied when the Court ruling is firm.

b) When justified by circumstances not attributable to the compulsory work yields tax and are perceived in different tax periods for which they were payable, the period in which they have registered.

c) in the case of operations in instalments or with deferred price, the tax must be charged as income made corresponding charges.

Considered or in operations with deferred price when its price is received, totally or partially, by means of successive payments or a single payment, provided that the period elapsed between the delivery and the expiration of the last or only one term is more than a year.

In case of the endorsement, the discount or the anticipated payment of the deferred amounts, is understood to have obtained, at that time, the pending charge.

The provisions of this section applies, irrespective of the way in which, in their case, they have counted the income and expenses in the income affected.

3. When the required change of fiscal residence condition for miss this tax or will produce his death, all the pending income imputation are integrated in the base of taxation for the last tax period in which they have to declare to this tax.

Chapter VII. The tax debt section one. The share of taxation Article 43 tax rate The tax rate of the tax is 10 percent.

Article 44 share of taxation The tax fee is the sum of the amounts resulting from application of the tax rate on positive settlement balances of the general, and the savings, respectively.

The share of taxation cannot be negative and, at least, is a left-luggage office from scratch.

Second section. Article 45 settlement fee payment Fee 1. The settlement is the result of reducing the share of taxation in the following amounts: a) in the first place, in the amount of the allowance provided for in article 46.

b) in the event that, after applying the previous bonus, subtract a positive balance of tax fee, this fee is reduced by the amount resulting from applying the tax deductions provided for in articles 47, 48 and 49.

2. The payment of liquidation cannot be negative as a result of the application of the subsidy and deductions and, at least, is a left-luggage office from scratch.

Article 46 bonus for obtaining income from work, economic activities or the real estate capital the tax income forced labour who have gained, income from conducting economic activities or real estate capital income is deducted from the share of taxation a bonus of 50 percent of the amount resulting from applying the tax rate of the tax on the amount of the basis of taxation of the tax obligation , reduced in the amount of 24,000 euros corresponding to the reduction provided for in the first paragraph of section 1 of article 35 to what may be entitled.

This bonus may not exceed the amount of 800 euros.

Article 47 tax deductions to eliminate internal double taxation 1. The share of taxation will be reduced accordingly to the amount of the tax fees met by the tax obligation to the communal tax on income from tenants and to the communal tax on the moment of commercial activities, business and professional income, corresponding to their economic activities or income in the real estate capital that have been integrated into the tax base of this tax.

2. the assets and liabilities of these deductions that have not been implemented for lack of payment can be deducted from the share of taxation of the three subsequent exercises.

Article 48 Deduction by eliminating international double taxation 1. When in the basis of taxation of the required capital gains or income tax integrated obtained and recorded abroad, is deducted from the payment of tax the least of the two following amounts: a) the cash amount paid abroad by reason of a similar tax in this tax or the tax on the income of non-resident tax that you have to be subject to the imposition of tax on these earnings or income required.

b) the amount of the tax that would have been paid in the Principality of Andorra to the above-mentioned income if they had obtained in Andorran territory. For the purposes of the calculation of this amount, the tax base corresponding to the foreign income is determined in accordance with the rules of this tax, and are solely attributable to this basis of taxation expenses specifically connected with the generation of income mentioned.

2. the amount of the tax paid abroad is included in income in accordance with the provisions of the preceding paragraph and, likewise, is part of the basis of taxation, although is not fully deductible.


3. When the required income tax on the tax period has obtained several overseas, the deduction will be calculated jointly for all.

4. The amounts not deducted for lack of payment of taxation can be deduced in the three tax periods that subsequently have been completed. For this purpose, the tax obligation to prove the origin and the amount of the deduction that intend to carry out by the display of appropriate documentary, regardless of the period in which originated the right to deduction.

5. Without prejudice to the established in the previous sections, when in previous tax periods tax rents NET has obtained the required negative through a permanent establishment abroad that have been integrated in the basis of taxation of the entity, the deduction only applies later in respect of income obtained for the permanent establishment mentioned from the moment in which it exceeds the amount of these negative incomes.

Article 49 Deduction for creation of jobs and investments Are taxable to perform economic activities can diminish the share of taxation the following amounts: a) the result of multiplying the amount of 3,000 euros per person increase means annual fixed template that has the required tax law. For this purpose, only calculated the labour contracts signed in Andorra and subject to labour legislation in Andorra. To determine the average increase of staff, it is estimated the average staff prorratejant the number of people by the days of the year that are contracted in employment relationship for the required tax and compares to the average staff of the previous year, determined in the same way. This increase means of staff must be kept in the year subsequent to the closing of the financial year. If you do not fulfill this increase means template, the tax must have to enter the amount of the deduction applied together with the late payment penalty.

b) The result of applying the 5 per cent to the value of the new investments made in Andorra of fixed assets to the affected business activity. These assets must be keep for a minimum of five years from the time they purchase. In case you do the maintenance of the investment for the minimum period of five years, the tax must have to enter the amount of the deduction applied together with the late payment penalty.

c) deductions provided for in this section are not applied for insufficient fee can be deducted from the share of taxation of the three subsequent exercises.

Chapter VIII. Payments on account Article 50 Required to make payments on account 1. Payments on account are considered tax debt in accordance with the provisions of the law on the bases of tax legislation, and may consist of tax withholdings, payments on account and debit payments.

2. Entities and legal persons residing in the Principality of Andorra that satisfy or obtained by revenue recorded by this tax are required to practice and revenue retention account, by way of payment on account of the tax on income of individuals corresponding to the recipient, and to pay the amount to the Ministry in charge of finance, when you meet the following types of income : in labor Income).

b) Investment Income.

3. Are subject to the same obligations individuals residing in the Principality of Andorra who carry out economic activities, with respect to the income they satisfy or obtained by it in the exercise of these activities, and the natural or legal persons tax non-residents who operate in the Principality of Andorra through a permanent establishment or without, when paid employment income recorded by this tax.

4. The Ministry in charge of finance or the Department that this necessary will determine the percentage to apply the concept of the deductions and payments on account on the incomes of the work subject to the obligation to quote to the Caixa Andorrana de Seguretat Social, in the terms and conditions to be determined by the regulations.

The regulations will determine the procedure that the tax obligation or the obligation to practice the retention will have to follow in order to provide to the Ministry in charge of finance circumstances decisive for the calculation of the percentage to be applied by way of withholding or paying on account, as well as any changes in these circumstances. The entrance to the Ministry in charge of the finances of the deductions and payments on account on income from work, is done through the Caixa Andorrana de Seguretat Social, in the terms and conditions to be determined by the regulations.

5. The calculation of the withholding tax and the revenue on account of the income of the different work of the mentioned in the previous section is determined by the payer of the income, under the conditions established by the regulations.

In these cases, the payer must report the taxable income subject to withholding or payment on account of the circumstances in which the second paragraph of the previous section, as well as its modifications, in the terms established by the regulations.

6. The calculation of the withholding tax and payments on account on investment income is determined by the payer of the income, under the conditions established by the regulations.

7. The taxable economic activities to exercise should be made in the month of September an instalment payment of the liquidation corresponding to the tax period which is in progress the first of September.

8. In no case are not forced to practice the retention or payment on account of the diplomatic missions or consular offices of foreign States in Andorra.

9. Entities and legal persons residing in the Principality of Andorra tax or non-resident that operate in the Principality of Andorra through a permanent establishment, and which are dipositàries of foreign securities or are responsible for the management of payment of the income derived from these values, have the obligation to make the withholding income derived from these values, in the terms and conditions to be determined by the regulations.

Article 51 amount of payments on account 1. The retention and income on account of the income of the work is determined in the following terms:


in the account and income) on the income from work is determined based on the net income of the work, calculated in accordance with article 13, taking into account the personal and family minimum of article 35, the reductions provided for in articles 38 and 39, the bonus of the article 46 and applying the appropriate tax rate in accordance with article 43. The percentage of revenue and retention on account is calculated in accordance with the regulations is available.

b) When, at any time during the tax period, will modify any circumstance relevant to the determination of the retention or payment on account, will proceed to the regularisation of the retention percentage or revenue account in accordance with the regulations is available.

c) in the event that the Ministry in charge of finances does not have information relating to the personal and family circumstances to be able to calculate the retention rate and revenue to account in accordance with that established in the letter a) of this section, this will be determined by taking into account only the staid returns received by the tax obligation.

2. As an exception to what is stipulated in the previous section, we apply a fixed retention rate of 10 percent on the following performance of the work: a) the full amount of the income from the delivery of courses, conferences, colloquia, seminars and other similar, except when considered to be income from economic activities.

b) the full amount paid to the tax obligation by way of notice, the excess of the financial compensation in relation to the amount established with mandatory, as well as any other compensation for dismissal or the termination of the employee determined according to the regulations.

c) the full amount of the income from work in the event that the Ministry in charge of finance did not have the personal and economic circumstances of the tax required to be able to determine the type of withholding and payment on account in accordance with the criteria laid down in paragraph 1.

3. In the event that the tax must receive, in concept of work, yields a variable remuneration as well as any other kind of premium, the amount of which is not fixed, the basis for determining the type of withholding and payment on account will include, at a minimum, these remuneration corresponding to the period preceding the tax, except that the tax can demonstrate objectively required a different amount According to the terms and conditions established by the regulations.

In the event that the required tax law has not set a variable remuneration in the year immediately prior to the tax period in progress, retention and revenue on account type will be determined on the basis of an estimate made by the payer of the income.

4. The retention and access to account on investment income are determined by applying a percentage fixed retention of 10 per cent on the amount of income wholly satisfied.

However, the tax must be applied for to the person or entity that rents minori the basis on which applies the retention percentage in the amount of the reduction provided for in article 37.

If you exercise this option, the forced to withhold determines the amount of the tax has been practicing by applying the percentage of withholding tax on income satisfied to the extent that this income exceeds the amount of the reduction resulting from applying article 37.

Regulations should regulate the procedure for the communication of the option to the entity or entities payable, with the aim of ensuring that the corresponding reduction is subject to application in the amount legally, without that there will be duplication.

5. When you have to make a withholding or a deposit to account on investment income in accordance with that set forth in paragraph 9 of article 50, the amount of the retention is reduced accordingly by means of the application of the deduction provided for in article 48, which entitled the required tax in relation to the foreign tax which has been subdued this income.

6. You don't have to practice the retention or payment on account in respect of income that are exempt by virtue of the provisions of article 5, in the terms that will fix the regulations.

7. The subject required to retain and practice income account must submit a statement to the Ministry in charge of finance, in the place, the way and the deadlines established by the regulations, of the amounts retained or the payments on account made, or negative declaration when appropriate. However, there is no obligation to declare the income they are exempt in accordance with article 5.

8. The amount of the instalment payment that must be made are taxable to exercise economic activity was calculated by applying the percentage of 50 percent over the immediately preceding tax period settlement fee.

However, the tax must be determined the amount of the instalment payment by applying a percentage of 5 per cent on net income from economic activities obtained in the preceding exercise. The exercise of this option will be done in time to present the corresponding claim in the instalment payment and not linked to future tax periods.

In case the previous period has a duration of less than twelve months, the instalment payment is done taking into account the proportional part of the settlement of previous periods to complete a period of twelve months.

The obligation to make payments by installments must submit a statement to the Ministry in charge of finance, in the place, the way and the deadlines established by the regulations, of the amounts paid by way of instalments.

Article 52 Deduction of payments on account and differential fee the amount of the withholding tax, the revenue account and the instalments will be deducted from the settlement fee to get the differential fee. When, to effect payments on account, the differential fee is negative, the Ministry responsible for finance must return the excess in accordance with what is established in article 58.

Chapter IX. Management and liquidation Article 53 tax Record


1. The taxable the tax on income of individuals must have a tax registration number (hereinafter, NRT), which should be requested in case you don't already possess as a taxable the tax on income of economic activities or indirect taxes. This number is unique for all State taxes. The request must be formalized by means of the standard form set by the Government.

2. The Ministry responsible for finance must carry a tax register in which to register individuals and entities without legal personality which are taxable to that tax.

3. The regulations will develop the forms, the terms and the documents required for the NRT, as well as the procedures for the management of the tax.

Article 54 obligation to cooperation with the owners of the register of Commerce and industry, the holders of the Liberal Professions and the owners of the register of associations must submit to the Ministry responsible for finance, for the telematic, information in relation to individuals and entities, the Constitution, the establishment, modification or termination related to the changes that occur in these records , as specified by the regulations.

The same obligation lies the notaries with regard to the Scriptures and other documents that will be authorised the creation, modification, transformation or extinction of all kinds of entities.

Article 55 Declarations 1. Are taxable must submit and sign a statement to this tax in the place and manner to be determined by the regulations between April 1 and September 30 of the year following the end of the tax period.

2. However, they are not required to submit the Declaration are taxable only obtain income from some or all of the following sources: a) Income from work.

b) Investment Income.

c) Income exempt under article 5.

3. Are required in any event to preview and subscribe to the declaration provided for in paragraph 1 are taxable income who have investment income received from employment or who have not been subjected to the obligation to make payments to your account in accordance with the provisions of article 50.

Article 56 Payment of income tax debt and 1. Are taxable, at the time of its Declaration, must determine the appropriate debt and enter it on the site and the form to be determined by the regulations.

2. The payment of the tax debt can be made through the delivery of assets of cultural heritage of the Principality of Andorra in the manner provided in the regulations of the cultural heritage of Andorra.

Article 57 Settlement tentative by the Ministry in charge of finance may turn the temporary settlement appropriate in accordance with the provisions of the regulations of the tax law, without prejudice to subsequent checks that may make the organs of this Ministry.

Article 58 ex officio refund 1. When, in accordance with article 52, the differential fee resulting from the self-assessment is negative, the Ministry in charge of finance, if necessary, must practice the temporary settlement within three months calculated from the moment at which the Declaration has been presented.

2. When the differential fee resulting from the payment or, if applicable, of the temporary settlement is negative, the Ministry responsible for finance must return to craft this fee, without prejudice to the practice of further settlements, final or provisional, which prosecuted.

3. If the tentative settlement has not been practiced within the period provided for in paragraph 1, the Ministry responsible for finance must return to craft the negative differential fee resulting from the payment, notwithstanding the practice of temporary or permanent settlements further that might be coming from.

4. If it takes place within the provisions of paragraph 1 without ever ordered the payment of a refund due to causes attributable to the Ministry in charge of finance, you should apply to the outstanding amount of the refund is the legal interest stipulated in the regulations of the tax law, from the day after the end of the period mentioned and up to the date of your payment , without the need for the tax claim forced it.

5. Regulations will determine the procedure and the method of payment for the completion of the return of trade referred to in this article.

Chapter x. infractions and sanctions Article 59 Offences Regulation infringements tax matter relating to the content of this law shall be governed, in that which is not established by this law, by the regime of infractions and sanctions established in the regulations of the tax law.

Article 60 types of infringements 1. Are considered incomplete without information on infringements in The simple: importance of settlement).

b) failure to comply with the requirements of information and/or documentation.

2. Are considered to be offences of defrauding: a) the non-presentation of the payment, when the presentation is compulsory in accordance with the provisions of this law.

b incomplete information on The importance of) with liquidation.

c) false information.

Article 61 Sanctions 1. The simple offences are sanctioned with a fixed fine of between 150 euros and 3,000 euros.

2. The offences of defrauding are sanctioned by a fine proportional to between 50% and 150% of the let down.

3. The above penalties are set following the graduation criteria set out in the regulations of the tax law.

Article 62 Notifications of infringements 1. Prior to the imposition of a penalty, must be notified to the person concerned the proposed resolution with indication of the facts charged, the precept infringed and the amount of the fine. The person concerned has a term of thirteen working days to raise everything they consider appropriate for their defense.

2. After the deadline of allegations, the competent body will issue the corresponding resolution, against which you can turn on the terms established in the regulations of the tax law.


3. In any case, and because the administrative act is in suspense, with the filing of the appeal must provide a sufficient guarantee, either a deposit or guarantee or a mortgage from a bank in Andorra that guarantees the total amount of the tax debt.

Chapter XI. Order of jurisdiction Article 63 jurisdiction The administrative jurisdiction, with the prior exhaustion of administrative remedies in tax matters, it is the only competent to determine disputes of fact and law that arise between the Ministry in charge of finance and are taxable in relation to any of the matters referred to in this law.

First additional provision. Cost of acquisition of securities representing participation in the own funds of institutions for the purpose of computing the capital gains and capital losses arising from the transfer of securities representing participation in the own funds of entities residing in the Principality of Andorra acquired before the entry into force of this law, is taken as the value of the acquisition of the participation transmitted the most of the two following theoretical value: the corresponding accounting in the closing date of the last tax period that ends before January 1, 2013 or the value of acquisition certified reliable form.

The theoretical accounting value is the result of the annual accounts deposited in the register of societies and formulated in accordance with the accounting regulations and commercial law in force in the Principality of Andorra.

Second additional provision. Cost of acquisition of the real property Are taxable incomes obtained from economic activities and are owners of real estate affected in their economic activity and have been acquired before the entry into force of this law, be considered as the value of the goods, for the purposes of applying the provisions of this law, the higher of the following two: the market value of these goods to 2014 According to a report of assessment is issued by an independent expert or its cost of acquisition certified reliable form.

The value of the property is obtained by subtracting the cost of acquisition or market value of the amounts mentioned in the previous paragraph, the linear depreciation that corresponds to the years between the commissioning of the element and the date of application of this law.

In relation to these elements, corresponds to the taxpayer the burden to prove reliably date of commissioning of the market price of the property element, as well as the depreciation and the corrections made axes for bookkeeping purposes prior to the effective date of application of this law; the lack of proof of these aspects determines the impossibility to amortize these items after the effective application of the law.

Third additional provision. Instalment payment corresponding to the first tax period of application of this law to determine the instalment payment that must be made in the first tax period in which this law is applicable, takes the payment fee or, if applicable, the net income corresponding to the tax on income of economic activities of the tax obligation in relation to the last year prior to the application of this law.

First transitional provision. Negative tax bases in the tax on the income from economic activities 1. The taxable that, at the beginning of the first fiscal year in which this Act is applicable, have negative tax bases to compensation, in accordance with the provisions of article 17 of law 96/2010 of 29 December, on the tax on the income from economic activities, can make up for them in the term and with the conditions laid down in this law for the bases of general taxation negative.

2. To determine the compensation of the negative tax bases referred to in the previous paragraph, it is considered that these rules were generated in the tax period in which were the subject of payment by the required tax of the tax on income of economic activities.

Second transitional provision. Outstanding deductions of the tax on the income from economic activities 1. The taxable that, at the beginning of the first fiscal year in which this Act is applicable, have outstanding deductions of application, in accordance with the established in articles 23 and 24 of the law 96/2010, of 29 December, of the tax on the income from economic activities, can be deducted from the share of taxation of the income tax of the three subsequent exercises 2. To determine the period of application of the deductions mentioned in the previous paragraph, it is considered that these deductions were generated in the tax period in which were the subject of payment by the required tax of the tax on income of economic activities.

Third transitional provision. Special scheme for residents without lucrative activity 1. The taxable who have obtained a residence permit without lucrative activity before the entry into force of this law, in accordance with the criteria established by the relevant regulations, they can receive the special regime established in this transitional provision.

2. The persons mentioned in the previous section, you opt for the application of the special scheme foreseen in this transitional provision, will not be subject to the tax on income of individuals during the time period in which this regime is applicable. In affections of the residence and domicile tax, will be considered the provisions of article 8.

3. However, the people from the special regime foreseen in this transitional provision must meet an annual amount of € 30,000 special encumbrance by residents without lucrative activity.

4. This transitional regime shall apply from the first tax period in which this law is applicable to the tax period that ends before January 1, 2018.

However, the people from this special scheme will be able to give up on its application to pay for the tax on the income of natural persons, by means of his resignation in the special scheme.

This resignation will take effect from the tax period following the one in which to communicate. The regulations will determine the terms and conditions under which it will make the communication of this waiver.


5. The procedures and forms related to the management and liquidation of the special tax corresponding to this special scheme will be determined by the regulations.

6. People from the special regime foreseen in this transitional provision shall not be entitled to the application of agreements to avoid double taxation which have signed the Principality of Andorra.

Fourth transitional provision. The first year of application of the tax for the first year of application of this law the term to apply to the regime established in articles 17 and 21, as well as the special regime established in the third transitional provision, it will be three months from the date of application of this law, in the terms and conditions to be determined by the regulations.

Repealing only. Income tax of the economic activities with effect from 1 January 2015, is repealed the law 96/2010 of 29 December, on the tax on the income from economic activities, as well as the provisions related to this tax contained in the Decree of 13 June 2012 by which approves the regulations of the income tax and the tax on the income from economic activities.

First final provision. Modification of the law on the income tax of non-tax residents 1. It introduces a new chapter sixth law 94/2010, of 29 December, which is worded as follows: "Article 36 bis.

The special regime of the frontier workers and seasonal workers 1. Non-tax resident workers hired by companies established or resident in the Principality of Andorra, which refers to article 12, when they are subject in their entirety to the regime of the Caixa Andorrana de Seguretat Social of the Principality of Andorra be payable in accordance with the General rules of the law of the tax on the income of natural persons.

2. For the purposes of determining the tax corresponding to the income from work received in relation to its activity as a frontier worker and/or seasonal workers and who are subject to this tax, they may choose to apply the following rules: a) for the purposes of determining the base of taxation, can diminish the full amount received on the following concepts:-The deductions provided for in the second paragraph of article 13 of the law on the tax on the income of natural persons.

-The reduction provided for in the first paragraph of section 1 of article 35 of the law on the tax on the income of natural persons.

When the period of duration of the work developed by frontier worker or time-keeper is less than a year, this reduction will prorrateja depending on the period of duration of the work in the course of the tax period.

b) for the purpose of determining the share of taxation, they can apply the allowance provided for in article 46 of the law on the tax on the income of natural persons.

3. The option of applying the rules set out in the previous section is exercised by filing with the Ministry in charge of the finances of a communication under the terms established by the regulations.

4. The determination of the amount and the procedure for the payment of the withholding tax and payments on account relating to the income covered in this article are made in accordance with the provisions for the incomes of the work on the provisions of the law on the tax on income of individuals. "

2. Modifies the letter a) of article 15 of the law on the tax on the income of non-resident tax, which is written as follows: "in the case of non-tax resident natural persons:-The compensation as a result of civil liability for personal injury, in the amount legally or judicially recognized. The same treatment is applicable to the compensation paid by the Government of Andorra for personal injury as a result of the functioning of public services.

-The compensation for dismissal or dismissal of a worker, in the amount established with mandatory under the regulations.

-Public scholarships and grants awarded by private entities, perceived by formal studies, both in the Principality of Andorra as well as abroad, with the conditions to be determined by the regulations.

-Literary, artistic or scientific awards relevant, with the conditions to be determined by the regulations.

-Capital gains that are set out due to a lucrative transmission mortis causa. "

3. Modifies the article 4 of the law of personal income tax of non-tax residents, which is worded as follows: "are taxable in this tax natural persons and legal persons non-tax resident in the Principality of Andorra who obtain income, which in accordance with this law, are considered to be generated in this area.

For these purposes, are considered to be tax-resident in the Principality of Andorra, the legal persons defined in article 7 of the law on the tax on companies and individuals defined in article 8 of the law on the tax on income of individuals. "

Second final provision. Exemption of the prizes of the game on the income tax of non-tax residents modifies the letter e) of article 15 of the law 94/2010 of 29 December, on the tax on income of non-resident tax, which is written in the following way: "the coming of the game as they are subject to the established in the regulations applicable to the game."

Third final provision. Update of the general budget law amounts, you can modify the amount of the reductions, allowances and deductions established by this law.

The fourth final provision. Enabling regulations 1. It entrusts to the Government the drafting of provisions and regulations necessary for the development and implementation of this law within a period of three months from its entry into force.

2. The Declaration of this tax and those of their payments on account are set by regulation, which should be set up, in addition to the form, the site and the deadlines for submitting them, the cases and conditions of your presentation by telematic means.

3. Is delegated to the Ministry in charge of finance management and collection of the tax is regulated by this law.


4. The taxable can make enquiries relating exclusively to the interpretation of the articles of the law. Should be answered, in a maximum period of six months, by the Ministry responsible for finance with binding. The Government has to establish the regulations the terms and the scope in which they can carry out these consultations.

Fifth final provision. Entry into force this law enters into force the day after being published in the official bulletin of the Principality of Andorra and is applicable to the exercises that will start from January 1, 2015.

Casa de la Vall, 24 April 2014 Vicenç Mateu Zamora Syndic General Us the co-princes the sancionem and promulguem and let's get the publication in the official bulletin of the Principality of Andorra.

Joan Enric Vives Sicília François Hollande Bishop of Urgell, President of the French Republic Co-prince of Andorra Co-prince of Andorra