Andorra vs Portugal: full comparison (taxes, residency, daily life)
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The short answer
Between Andorra and Portugal, the clearest gap is taxation: Andorran IGI is 4.5 % against 23 % VAT in Portugal, and corporate income tax is 10 % against 29.5 %. The advantage only holds if your Andorran residency is genuine; housing costs and the job market matter just as much.
The comparison at a glance
| Criterion | Andorra | Portugal |
|---|---|---|
| Consumption tax (standard rate) | IGI: 4.5 %verified on 09/10/2026 | VAT: 23 %verified on 09/10/2026 |
| Corporate income tax | 10 %verified on 09/10/2026 | 29.5 %verified on 09/10/2026 |
| Personal income tax | Single rate of 10 %verified on 09/10/2026 after an exempt minimum of 24,000 €verified on 09/10/2026 | Top marginal rate: 53 %verified on 09/10/2026 |
| Social contributions | CASS, total 22 %verified on 09/10/2026 | Depends on the national scheme |
| Tax residency | Presence of more than 183 daysverified on 09/10/2026 | Depends on national law |
The Portuguese rates are national statutory rates (2026 edition, including the local share for income and companies). They do not take account of special regimes or social contributions.
Why compare Andorra and Portugal
Portugal was for a long time the destination of French retirees seeking sunshine and tax advantages. Since the end of the original regime, comparing it with Andorra is relevant again.
Andorra attracts people first through its taxation: a single-rate income tax, a low corporate income tax and a consumption tax far below most European countries. But it is not just a matter of rates: settling there requires genuine residency, housing in a narrow market and adapting to life in the mountains.
Taxation in figures
On consumption. For €1,000 of purchases before tax, the tax is €45 in Andorra (general IGI) against €230 in Portugal (VAT at the standard rate).
On companies. For €100,000 of profit, corporate income tax is €10,000 in Andorra against €29,500 in Portugal at the combined statutory rate.
On income. Andorra applies a single rate after an exempt minimum, with a capped allowance: the effective tax is therefore much lower than the top rate in Portugal. Simulate your own case below.
How Portugal taxes its residents
Portugal taxes its residents on their worldwide income, with a progressive scale and special rates on certain types of income. The non-habitual resident regime, which attracted many French retirees, has been closed to new arrivals since 2024 and replaced by a more restricted scheme. The residency rules are based on presence and the availability of a home.
What you need to become a resident in Andorra
Moving your residence to Andorra is not a simple relocation: you need a residence permit suited to your profile and a genuine presence, of at least 183 daysverified on 09/10/2026 a year to be a tax resident. For residency without gainful activity, the minimum investment is 1,000,000 €verified on 09/10/2026. See the overview of the statuses and the passive residency cost simulator.
Who should choose Portugal, and who should choose Andorra
Choosing Portugal suits those who want sunshine, the ocean, a moderate cost of living and a well-established expatriate community.
Choosing Andorra suits those who prefer a single, predictable tax rate, mountains close to France and an environment without wealth taxation.
The pitfall to avoid
Simulate the gap for your situation
Enter your figures: the comparison tool calculates your Andorran tax and the gap with Portugal on consumption and on a company's profits.
Andorra / Portugal difference
€5,550
Estimated annual saving in Andorra (negative: more expensive)
- Tax and contributions in Andorra on income
- €6,700
- Consumption tax: IGI 4.5% versus VAT 23%
- €5,550
- Corporate income tax: 10% versus 29.5%
- €0
Statutory rates, excluding special regimes. Actual social contributions and cost of living are not modelled: have your case validated.
What if you are French?
A French person who settles in Andorra remains subject to French connecting rules: a single criterion is enough to remain tax-domiciled in France. Test your situation with the tax domicile tool and read the treaty between France and Andorra.
Work out your own case
Free simulators, built on the official values of this page.
Frequently asked questions
Is Andorra taxed less than Portugal?
On paper, yes: the general IGI is 4.5 % against 23 % VAT in Portugal, and corporate income tax is 10 % against 29.5 %. The advantage depends on your genuine residency.
What is the top rate of income tax in Portugal?
The top marginal rate in Portugal is 53 %, local shares included and excluding social contributions. Andorra applies a single rate of 10 % after an exempt minimum.
Does the non-habitual resident regime still exist?
It was closed to new arrivals in 2024 and replaced by a more targeted scheme. Check the current conditions before deciding.
Which country is simpler for a French retiree?
It depends on the pension (private or public), housing and health. See our pages on retirement in Andorra.
Do you have to leave Portugal to benefit from Andorra?
Yes: to benefit from Andorran taxation, you must become an Andorran resident in fact, with a presence of more than 183 days a year and a genuine home, and take the financial year out of your former tax residence.
How can you simulate the gap between Andorra and Portugal?
Use the comparison tool on this page: it calculates Andorran tax and the gap on consumption and profits, based on your own figures.
Going further
Official sources
This information is general and is not personalised legal, tax or financial advice. It is verified as of the date shown and may change.