Andorra or Romania: full comparison (taxes, residency, daily life)
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The short answer
Between Andorra and Romania, the clearest gap is taxation: Andorran IGI is 4.5 % against 21 % VAT in Romania, and corporate tax is 10 % against 16 %. The advantage only holds if your Andorran residency is genuine; the cost of housing and the job market matter just as much.
The comparison at a glance
| Criterion | Andorra | Romania |
|---|---|---|
| Consumption tax (standard rate) | IGI: 4.5 %verified on 09/10/2026 | VAT: 21 %verified on 09/10/2026 |
| Corporate tax | 10 %verified on 09/10/2026 | 16 %verified on 09/10/2026 |
| Income tax | Single rate of 10 %verified on 09/10/2026 after a tax-free minimum of 24,000 €verified on 09/10/2026 | Top marginal rate: 10 %verified on 09/10/2026 |
| Social contributions | CASS, total 22 %verified on 09/10/2026 | Under the national scheme |
| Tax residence | Presence of more than 183 daysverified on 09/10/2026 | Under national law |
The rates for Romania are national statutory rates (2026 edition, including the local share for income and corporate tax). They do not take account of special regimes or social contributions.
Why compare Andorra and Romania
Romania is a large European Union market with moderate taxation, compared with Andorra for entrepreneurs.
Andorra is attractive first of all for its taxation: a single-rate income tax, a low corporate tax and a consumption tax far below most European countries. But it is not just about the rates: settling there requires genuine residency, housing in a tight market and adapting to mountain life.
Taxation in figures
On consumption. For €1,000 of purchases before tax, the tax is €45 in Andorra (general IGI) against €210 in Romania (VAT at the standard rate).
On companies. For €100,000 of profit, corporate tax is €10,000 in Andorra against €16,000 in Romania at the combined statutory rate.
On income. Andorra applies a single rate after a tax-free minimum, with a capped allowance: the effective tax is therefore well below the top rate in Romania. Simulate your own case below.
How Romania taxes its residents
Romania applies a low single-rate income tax, high social contributions and simplified regimes for small businesses. The consumption tax was raised recently.
What it takes 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 statuses and the passive residency cost simulator.
Who should choose Romania, who should choose Andorra
Choosing Romania suits those who are looking for a large market, a low cost of living and simplified regimes for small businesses.
Choosing Andorra suits those who want a low consumption tax and a setting close to France.
The pitfall to avoid
Simulate the gap for your situation
Enter your figures: the comparison tool calculates your Andorran tax and the gap with Romania on consumption and on a company's profits.
Andorra / Romania difference
€4,950
Estimated annual saving in Andorra (negative: more expensive)
- Tax and contributions in Andorra on income
- €6,700
- Consumption tax: IGI 4.5% versus VAT 21%
- €4,950
- Corporate income tax: 10% versus 16%
- €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 tax-residency connection rules: a single criterion is enough to remain tax-domiciled in France. Test your situation with the tax domicile tool and read the France–Andorra treaty.
Work out your own case
Free simulators, built on the official values of this page.
Frequently asked questions
Is Andorra taxed less than Romania?
On paper, yes: general IGI is 4.5 % against 21 % VAT in Romania, and corporate tax is 10 % against 16 %. The advantage depends on your genuine residency.
What is the top rate of income tax in Romania?
The top marginal rate in Romania is 10 %, local shares included and excluding social contributions. Andorra applies a single rate of 10 % after a tax-free minimum.
Does Romania have low taxes?
Its income tax is on a par with Andorra's, but its contributions weigh heavily.
Which country is better for a small company?
Both have favourable rules; the clientele and proximity matter more.
Do you have to leave Romania 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 real home, and have the year taken out of your former tax residence.
How can I simulate the gap between Andorra and Romania?
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.