Relocating your company or business from France to Andorra

Leaving France for tax purposes: Article 4 B

It all starts with a French question: will you remain domiciled in France for tax purposes? Article 4 B of the French General Tax Code answers it with three criteria.

These criteria are alternatives: just one is enough for you to remain domiciled in France. They only give way if the tax treaty regards you as a resident of Andorra. And the treaty requires more than 183 days in Andorra, or that your main economic interests or your main activity be there; an Andorran residence permit is not enough on its own. A successful departure therefore means genuinely moving your home, your work and your interests, and being able to prove it. See our guides to leaving France for tax purposes and to tax residency in Andorra.

Relocating your company without leaving: why it does not work

Registering a company in Andorra while continuing to live and work in France does not take the business out of the scope of French tax. Three rules apply cumulatively:

• you remain domiciled in France for tax purposes, and therefore taxable on your worldwide income, if your home, your main activity or the centre of your economic interests remain there (Article 4 B);
• the company managed from France can be taxed there, by virtue of its place of effective management or of a permanent establishment (tax treaty, art. 4 and 5);
• the sums it receives for services that you provide from France can be taxed in your name, in particular if you control it (Article 155 A).

On the Andorran side, a company with foreign capital must also carry on a genuine activity within 18 months, and it gives you no right of residence. The criteria applied by the courts, and the evidence to gather, are detailed in our guide to basing your company in Andorra.

Exit tax: are you affected if you leave with your company?

The exit tax (Article 167 bis of the French General Tax Code) taxes, at the time of departure, unrealised capital gains on certain securities. According to the tax authorities, it concerns people who have been tax resident in France for at least 6 of the 10 years preceding departure and who hold securities with a total value of at least €800,000 or representing at least 50% of the profits of a company. It is declared on form No. 2074-ETD, in the year following departure, with the income tax return.

For departures since 2019, the deferred tax can be cancelled after two or five years depending on the case, if the securities have not been sold in the meantime. The scheme is, however, the subject of debate during the examination of the Finance Bill for 2027: check the rules in force on the actual date of your departure. Thresholds, deferral and form: see the details of the exit tax.

Keep, close or transfer your SARL or SAS?

Three options are open to you, whether your company is an SARL, an EURL, an SAS or an SASU: keep it, sell or liquidate it, or transfer its registered office. Each has its own tax consequences.

Whichever option you choose, its tax, social security and legal effects depend on the form of the company, its reserves, its assets and your timetable: study it with a tax lawyer before departure. For a company that mainly holds shareholdings, see also our guide to the holding company in Andorra.

Setting up the Andorran structure and obtaining residency

Apart from qualified professions, the route provided for by law is to set up an Andorran company and apply for self-employed residency (Llei 9/2012, art. 38 ter):

• reservation of the residence authorisation, then 6 months to provide proof of the foreign investment authorisation and of a company in which you hold more than 34%;
• a director’s position with effective management;
• payment of €50,000 to the AFA when the application is submitted, non-refundable except if the initial authorisation is refused;
• a registered business licence, active within 3 months of the application;
• for renewal: at least 183 days a year in Andorra and a real activity.

These authorisations are limited by an annual quota: Decree 75/2026 provides for 200 residence and work permits for self-employment in 2026. If at least 85% of your services are used outside Andorra, the status of professional with international reach is another route. See the steps for setting up an Andorran company.

Social security: from the URSSAF to the CASS

By moving to Andorra to work there, you will in principle change social security system. The France⁠–⁠Andorra agreement of 12 December 2000, in force since 1 June 2003, attaches every worker, employed or self-employed, to the scheme of the State where they carry on their activity, or to the schemes of both States if they work in both (art. 4). The Andorran scheme is compulsory for employees and the self-employed alike, and the director of your company contributes to it as a self-employed worker: see CASS contributions in Andorra.

• Posting: a self-employed person who carries out a temporary service in Andorra on their own account can remain affiliated in France for one year, renewable once, with forms SE 130-01, issued by the Urssaf, and SE 130-08, issued by the health insurance fund;
• Retirement: each country pays a pension for the periods completed under its legislation; it also calculates a pro rata pension by aggregating the periods in both countries and pays the higher amount, whatever the retiree’s country of residence;
• Supplementary pensions for the self-employed: the supplementary old-age insurance schemes for French self-employed workers are excluded from the agreement (art. 3);
• Unemployment: the agreement does not coordinate unemployment insurance.

Your French clients: invoicing, VAT and IGI

Nothing prevents your Andorran company from working for French clients. Invoicing follows a few rules:

• business clients: a service supplied to a business established in France is not treated as supplied in Andorra for IGI purposes (Llei 11/2012, art. 43); you invoice without IGI or VAT, and the French client pays the VAT under the reverse charge;
• private clients: French VAT is due on electronic services and on other services that the client actually uses in France (CGI, art. 259 C and 259 D); it is declared through the non-Union One-Stop Shop. For goods, import VAT applies;
• existing contracts: an amendment or a new contract must designate the Andorran company as the service provider, with its Andorran contact details.

Caution is needed above all in the way you work. If you continue to see your clients in an office in France, or if a partner or an employee habitually concludes contracts there in the company’s name, the company may have a permanent establishment in France, whose profits are taxable there (treaty, art. 5 and 7). For invoicing itself, see how to invoice between France and Andorra; for a remote activity, our guide to e-commerce and online businesses.

Article 155 A: the risk for services provided in France

If you continue to provide services to French clients, the sums received by your Andorran company can be taxed in your name: Article 155 A of the French General Tax Code provides for this for services provided by a person domiciled in France, or provided in France by a person domiciled elsewhere, where that person controls the company, where the company does not predominantly carry on another industrial or commercial activity, or where it benefits from a privileged tax regime. The company is then jointly and severally liable for the tax. Organise the service, and the place where you perform it, accordingly.

Relocating your company to Andorra: a typical timetable

This timetable is indicative: it sets out the steps and the known legal time limits in sequence, with no guaranteed duration.

1. 1

   Assess your situation

   With a tax lawyer: tax domicile, exit tax, what happens to the French company, social security, timetable for any sale.

2. 2

   Prepare the move

   Housing in Andorra, children’s schooling, health cover until affiliation to the CASS.

3. 3

   Start the Andorran procedures

   Reservation of the company name, application for the foreign investment authorisation (two months, extendable by one month), reservation of the residence authorisation and payment of €50,000 to the AFA when the application is submitted.

4. 4

   Incorporate the company

   Open the account “in formation”, have the articles of association drafted, sign the notarial deed; the register decides within 15 days of receiving the deed.

5. 5

   Open the business and register with the CASS

   Business licence card, NRT, affiliation to the CASS: the director’s contributions start 30 days after the company is registered.

6. 6

   Genuinely leave

   Moving your household, transfer of contracts, change of address with banks and government bodies.

7. 7

   Settle matters on the French side

   Income tax return for the year of departure, form 2074-ETD if the exit tax applies, informing your clients and your social security bodies.

8. 8

   Stay the course

   At least 183 days a year in Andorra, accounts and returns up to date, decisions taken on site.

Your days in Andorra

Count your days in Andorra over the year, against the 90-day and 183-day thresholds.

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Checklist before you leave

• I know which criterion of Article 4 B currently links me to France, and how to break that link.
• I have had it checked whether the exit tax applies, and whether a deferral is possible for Andorra.
• I have chosen what happens to my French company after a tax simulation.
• My foreign investment application and my business plan are consistent.
• I have budgeted for the capital, the official fees and the non-refundable €50,000.
• My arrangements leave neither an office nor anyone in France who would conclude contracts for the company.
• My French business clients know that they account for the VAT under the reverse charge.
• I keep a record of my days of presence and I retain my supporting documents.
• I know who will handle the bookkeeping and the returns for IGI, IS and CASS in Andorra.

Costly mistakes