On December 17, 2015 was issued the edict which was issued in the Official Gazette of the Principality of Andorra (hereinafter BOPA No. 88) the Agreement between the Principality of Andorra and the Kingdom of Spain avoidance of double taxation with respect to taxes on income and prevent tax evasion . This, however, enter into force on 26 February 2016.
The entry into force of the double taxation agreement (hereinafter CDI) between the governments of Andorra and Spain added to the current CDI France , from the first of January 2016 and signed with Luxembourg. The importance of the agreement is crucial in the international recognition of the Andorran tax system , where Spain is the main economic partner of the Principality of Andorra, along with France. In addition, however, it is also important to provide a legal guarantee that the investments of the different states of economic and fiscal costs of removing the non-signing of the Convention meant.
One aspect that is analyzed tax Andorra in relation to which there are other small states and other European countries such as Ireland, the Netherlands and Switzerland. The conclusion is that from the point of view of fiscal jurisdiction Andorra "is of the best, if not the best in Europe."
Favoring investment that facilitates the Convention is undoubtedly a great tool for boosting economic growth in Andorraand shows the clear commitment of Andorra to commit to transparency and economic openness to diversify its economy . The CDI is key to encouraging investment, as it provides legal security and reduce tax payments.
For new foreign investment is required to submit a project investment , the Andorran government will analyze and assess their suitability. If you meet all the requirements, n'autoritzarà investment within six weeks.
The Agreement between Andorra and Spainsubstantially follows the model established by the OECD and, therefore, most of the world CDI. The most current is included in the Protocol, a document which states that understand the specific collect appropriate limitation, interpretation and application of certain provisions of the Convention and benefits. You have to understand the provisions of the Convention in accordance with the movement of intense change in the concept of international taxation, as recently present highlights and, therefore, its provisions must be understood as a consequence of this environment, very demanding, but it has the virtue of providing from the outset better fit the new concept of international taxation. So, Andorra is positioned as an agent of first order,
The model Andorran tax brings in foreign investment, among other things, allows new foreign capital investment initiatives and projects of international character as a result of the existence of CDI Spain and Andorra , which is an extremely positive element in the tax planning an international businessman, professional investor or saver.
However, prudence requires good planning and accurate and appropriate interpretation of the rules of the CDI and the rules of each state in each specific case. Thus, a tax planning adequate should get tax efficient structures to the new reality in order to ensure the safety and profitability of transactions.