Moving from Taiwan to Andorra: Residency, Taxation, and Structuring in 2026
Comprehensive Guide for Taiwanese Nationals — Immigration, Taxation, Holding Companies, and Succession
Status as of 2026: The 2026 passive residency quotas have been partially exhausted. The investment threshold has increased to €1 million since January 2026 (up from €600,000 in 2024). An application submitted today may still be approved if a decree is issued—but every month of waiting reduces the window of opportunity. Taiwanese nationals enjoy visa-free access for stays of less than 90 days, but residency requires separate procedures that should be initiated as soon as possible.
Among those settling in Andorra, Taiwanese nationals form a distinct group: tech entrepreneurs, heads of family-owned businesses, and high-net-worth investors whose assets are spread across Taiwan, Hong Kong, and Europe. What do they have in common? High tax rates in Taiwan (up to 40% on income), heavy inheritance taxes, and the absence of a tax treaty between Andorra and Taiwan—a unique situation that warrants special attention when structuring the application. This guide details the requirements for obtaining Andorran residency, the tax considerations specific to Taiwanese nationals, and the wealth management strategy tailored to this profile.
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I. Why Taiwanese nationals are looking to Andorra
Under Taiwan’s tax system, residents are subject to a progressive income tax with a marginal rate of 40% on income exceeding TWD 4.72 million per year (approximately €140,000). Dividends from Taiwanese companies are included in taxable income, with an 8.5% deduction capped at TWD 80,000. For estates, Taiwan applies a progressive tax rate of up to 20%—with an exemption of TWD 500,000 per heir, which is largely insufficient for significant estates. There is no wealth tax (Taiwan abolished the net worth tax in 2000), nor is there a withholding tax on dividends paid to Andorran companies in a non-treaty context.
This last point is key to understanding the tax structure that needs to be established: Andorra and Taiwan have not signed a double taxation treaty. In the absence of such a treaty, transactions between a Taiwanese company and an Andorran holding company are subject to the domestic tax rules of each country—without the mechanisms for eliminating double taxation found, for example, in the 2022 Franco-Andorran treaty or the Andorran-Spanish treaty. This requires particularly careful structuring to avoid any tax friction on dividend payments.
The cumulative tax differential
For a Taiwanese entrepreneur earning €500,000 in annual income, the difference between residency in Taiwan and residency in Andorra speaks for itself: in Taiwan, the income tax rate on this level of income exceeds 40% in the top bracket, amounting to potentially €150,000 to €180,000 in taxes depending on the composition of the income. In Andorra, personal income tax is capped at 10% on the portion exceeding €40,000—with a full exemption on the first €24,000 and an intermediate rate of 5% between €24,000 and €40,000. On this same income, the Andorran tax burden caps out at approximately €46,000. The annual savings exceed €100,000, without even factoring in the benefits regarding capital gains and inheritance.
| Tax criterion | Taiwan | ★ Andorra |
|---|---|---|
| Individual Income Tax | Progressive up to 40% | 0% (€0–24,000) · 5% (€24,000–40,000) · 10% above that |
| Corporate tax | Standard 20% | 10 % |
| Dividends received by the holding company | Included in income (up to 40%) | 0% (partner who is a tax resident of Andorra) |
| Wealth tax | 0% (abolished in 2000) | 0 % |
| Inheritance tax | 0 to 20% (gradual) | 0% direct line |
| Gift tax | 0 to 20% (gradual) | 0 % |
| Capital gains on securities (pure holding company) | Taiwanese IS 20% | 0% (Section 38 — pure holding company) |
| VAT / Indirect Taxation | 5% (Taiwanese VAT) | 4.5% (IGI) |
| Bilateral Tax Treaty | None with Andorra | None with Taiwan — to be addressed structurally |
| Minimum attendance required | Taiwanese residence | 3 months per year (passive residence) |
Taiwanese tax data based on the 2025 tax schedule. Andorran data updated in May 2026. Structuring without a treaty requires a case-by-case analysis.
II. Obtaining Andorran Residency: Options Available to Taiwanese Nationals
Taiwanese nationals are eligible for the same residency statuses as all non-Andorran nationals. The distinction between administrative residency and tax residency is fundamental: obtaining authorization to reside in Andorra is not sufficient to become a tax resident. Both statuses must be established independently and cumulatively.
Passive housing — the recommended standard
Passive residency is intended for individuals who do not engage in professional activities within Andorra. It is the natural choice for investors, retirees, executives of foreign companies, and families with significant assets. It requires a minimum presence of three months per year in Andorra—the lowest residency requirement in Europe for a comparable tax residency status.
The 2026 requirements for passive housing:
- Investment of €1,000,000 in Andorra (threshold raised as of January 2026)
- A non-refundable deposit of €50,000 with the AFA (Andorran Financial Authority), plus €12,000 per dependent
- Proof of sufficient income to support oneself without working in Andorra
- Private health insurance purchased through an Andorran broker
- No criminal record in any of the countries where the applicant has resided over the past five years
- Medical examination in Andorra
The €1 million investment must be made within six months of obtaining a residence permit. Acceptable forms of investment include contributing securities to an Andorran holding company, purchasing real estate, taking out a life insurance policy with an Andorran bank, or investing in financial products issued by Andorran institutions. For Taiwanese nationals whose assets consist primarily of corporate securities, contributing to an Andorran holding company is generally the most effective solution—it simultaneously satisfies the investment requirement and serves as the central tax vehicle for the arrangement.
The residency with an international focus — an alternative for working executives
This status is intended for individuals who manage or own at least 15% of one or more companies established outside Andorra. For a Taiwanese national who retains operational control of a group in Taiwan, Hong Kong, or Singapore, this is a particularly suitable option. The residency requirement is the same as that for passive residency (three months per year), but this status allows for the pursuit of professional activities from Andorra in connection with companies held abroad. The investment threshold remains comparable to that of passive residency.
Active residence — best avoided in most cases
Active residency requires the pursuit of a genuine business activity within Andorran territory, including business premises, a government-approved business plan, and a minimum presence of six months per year. In 2026, the Andorran government significantly tightened the criteria for approving business plans, without codifying these criteria into law. The risk of rejection is real and results in the loss of the quota used. For Taiwanese high-net-worth individuals, this status is rarely suitable.
The pressure of quotas — the 2026 deadline
Andorra’s residency system operates on a quota basis established by government decree, with no predictable schedule. The 2025 quotas were exhausted as early as November 2025. The 2026 active residency quotas are already exhausted. A decree issued in March 2026 opened approximately 170 passive residency slots, which were quickly filled. There is no clarity regarding the next decree. For a Taiwanese national with a serious plan, preparing the application in advance of the next decree’s publication is the only reliable strategy—a complete application can be submitted within hours of publication, whereas one prepared in a rush may miss the window.
III. Becoming an Andorran tax resident: what this means in practice
Administrative residency (the residence permit) and Andorran tax residency are two distinct concepts governed by two different sets of laws. Administrative residency falls under immigration law. Tax residency falls under the Personal Income Tax Act (IRPF).
The two alternative criteria for Andorran tax residency
First criterion: residing in Andorra for at least six months per year. Andorran law takes a flexible approach to “sporadic absences”: weekends spent outside Andorra and short-term vacations are generally not counted. This criterion is distinct from that of administrative residence (three months for passive residents)—a passive administrative resident who spends only three months in Andorra without having established a holding company there must demonstrate that their center of economic interests is in Andorra by other means.
Second criterion: having the center of one’s economic interests in Andorra. This criterion can be met by establishing an Andorran holding company into which the Taiwanese national transfers the majority of their assets. Consequently, on a personal level, their main assets consist of shares in an Andorran company—and their center of economic interests shifts to the Principality. This criterion is particularly relevant for individuals whose physical presence in Andorra remains limited during the first year.
The recommendation is to meet both criteria at the same time—this strengthens the tax position.
The Lack of a Taiwan-Andorra Tax Treaty: Practical Implications
In the absence of a bilateral treaty, conflicts of tax residency between Taiwan and Andorra must be resolved under the domestic law of each state—without a treaty-based arbitrator. Andorran tax residency criteria apply on the Andorran side: permanent residence, center of vital interests, habitual residence, and then nationality. On the Taiwanese side, the concept of “household registration” (戶籍) plays a crucial role: a Taiwanese national registered in the Taiwanese household registry may be considered a tax resident of Taiwan regardless of their physical presence on the island.
To ensure a smooth exit from Taiwanese tax residency, two conditions must be met. First, removal from the household registry (遷出戶籍), an administrative procedure handled by the Taiwanese municipal office. Second, establishing a documented primary residence in Andorra—whether owned or rented—with proof of presence. A Taiwanese tax advisor specializing in expatriation must be involved to ensure a smooth exit from the Taiwanese system, in parallel with Engage’s work on the Andorran side.
The primary residence and the second home
A Taiwanese national who retains real estate in Taipei or Kaohsiung for personal use faces a risk: the Taiwanese authorities could consider this property to be a permanent residence, thereby maintaining the tax residency status. The solution involves transferring this property to a corporate entity, renting it out to third parties, or selling it—so as to no longer have a personal residence in Taiwan.
IV. Wealth Planning for a Taiwanese National in Andorra
The Andorran holding company is the cornerstone of the structure for virtually all significant wealth management profiles. It serves several purposes simultaneously: fulfilling the investment requirement for passive residency, consolidating the center of economic interests in Andorra, optimizing dividend flows, and preparing for inheritance without estate taxes.
The asset holding company vs. the pure holding company under Article 38
Two types of holding company structures coexist under Andorran law. The general holding company may hold any type of asset—equity interests in companies, real estate, financial assets—and is subject to a 10% corporate income tax on its profits. The “pure” holding company under Article 38 limits its activities to holding equity interests in companies (no direct ownership of real estate, no proprietary financial assets). In return, it benefits from a total exemption on dividends received from subsidiaries and on capital gains from the sale of equity interests—provided that the subsidiary is subject to a tax rate of at least 5% in its country of origin, or that there is a tax treaty between that country and Andorra.
For a Taiwanese national whose subsidiaries are subject to Taiwan’s 20% corporate income tax, the 5% minimum tax requirement is easily met. The Article 38 pure holding company structure is therefore available, and it eliminates any Andorran taxation on dividends repatriated from Taiwan. In the absence of a tax treaty, the withholding tax on Taiwanese dividends paid to an Andorran company is governed by Taiwanese domestic law—it amounts to 21% for non-resident companies (versus 5% under the Franco-Andorran treaty). This point is critical: the use of an intermediary structure in a country linked to both Taiwan and Andorra can reduce this tax burden, but this requires a thorough case-by-case analysis.
Foreign Investment Authorization (FIA)
Any foreign national wishing to establish an Andorran company and hold more than 10% of the capital must first obtain a Foreign Investment Authorization (FIA) from the Andorran government. This authorization is required for the initial incorporation of the company and for any subsequent capital increases. Without it, subscribing to shares is legally impossible. The processing time is approximately four to six weeks. The exception: a national who already holds an Andorran residence permit is exempt from the AIE for non-real estate investments. This is another reason to prioritize the residence application process—it simplifies all subsequent steps.
For real estate, the AIE remains mandatory even for residents, regardless of how long they have lived in the country. An important practical detail: in Andorra, real estate investment authorization is never made a condition precedent in preliminary sales agreements—the seller would not accept it. The AIE must therefore be obtained before signing the preliminary agreement, not after.
Banking openness — a critical step
The three Andorran banks (Creand, Andbank, MoraBanc) apply rigorous due diligence procedures to funds originating in Asia. A Taiwanese national must prepare a thoroughly documented source-of-funds file: professional history, five-year income statements for Taiwanese companies, bank statements, Taiwanese tax returns, and explanations for each significant source of funds. The account opening process can take four to eight weeks—and determines the rest of the arrangement. Opening an Andorran bank account as soon as possible is imperative.
Wealth transfer — Andorra's structural advantage
Andorra does not levy any inheritance or gift taxes. This is a significant structural advantage for Taiwanese families with substantial assets who are accustomed to inheritance taxes of up to 20%. The recommended strategy involves transferring the bare ownership of the shares in the Andorran holding company to the children, while the parents retain the usufruct. The parents receive the dividends and retain control of the structure during their lifetime. Upon death, the children become full owners without any inheritance tax liability in Andorra. However, it is important to analyze the inheritance tax laws applicable in the heirs’ country of residence at the time of death—if they reside in a country that taxes inheritances on foreign assets received, particular caution is required.
What strategy should you choose based on your profile?
Taiwanese tech entrepreneur
Holding, Section 38A profitable Taiwanese company with significant dividend income. The Article 38 holding company eliminates Andorran corporate income tax on remittances. Personal income tax remains capped at 10%. The main challenge is managing Taiwanese withholding tax in the absence of a tax treaty.
Multi-jurisdictional family business
Residency with an international focusSubsidiaries in Taiwan, Hong Kong, Singapore, or Europe. The international tax residency allows the group to be managed from Andorra (3 months per year) through a central holding company. Andorra becomes the tax hub for the international group.
Private investor
Passive houseFinancial portfolio, minority stakes, real estate. A passive residency of 3 months per year is sufficient. An Andorran life insurance policy can serve as the required €1 million investment while also managing your financial assets.
Traditional family with children
Breakup of a holding companyAndorran international education, inheritance-free transfers, and gifts of bare ownership to children. A split Andorran holding company is the most effective vehicle for this scenario.
Wei-Ling, 47 — founder of a Taiwanese SaaS company
Wei-Ling ran a B2B SaaS group from Taipei with subsidiaries in Singapore and Europe. In 2025, her dividend income exceeded €600,000, triggering an effective tax rate of 38% in Taiwan. Her local advisor recommended that she look into Andorra. Following an audit conducted by Engage, the chosen structure was that of an Andorran residence with an international focus, combined with the creation of a pure Article 38 holding company into which she transferred her equity interests in the group. Her removal from the Taiwanese household registry and the establishment of a permanent residence in Andorra secured her tax exit. Ten months after the process began, Wei-Ling is an Andorran resident. Her effective tax rate has dropped to 11%. “What I found hard to believe was that the requirement to be present for three months a year was real—I thought there would be hidden conditions. There aren’t any.”
The 7 Steps to Relocating from Taiwan to Andorra
Preliminary Assessment of the Situation in Taiwan
Analyze the composition of the client’s assets (companies, real estate, financial assets), existing structures, and matrimonial property regime, and identify constraints specific to Taiwanese residency status—particularly the household registration (戶籍) and holdings in listed or controlled companies. Calculate the tax implications of ceasing Taiwanese residency. This step requires collaboration between Engage for the Andorran aspect and a Taiwanese tax specialist with expertise in expatriation.
Choosing Andorran residency status
Choose between passive residency (3 months/year, €1 million, no business activity in Andorra), residency with international scope (3 months/year, €1 million, business activity related to foreign companies owned), or active residency (6 months/year, approved business plan). For most Taiwanese nationals, passive residency or residency with international scope is the obvious choice.
Preliminary preparation of the residency application
Gather the required documents before the next quota decree is published: passport, criminal records from each country of residence over the past five years, proof of income, and proof of accommodation in Andorra. Engage will prepare the complete application package to submit it within hours of publication—this is the only way to ensure you don’t miss the window.
Application for a Foreign Investment Authorization (FIA) and Bank Account Opening
Initiate the AIE process in parallel with the residency application to avoid a domino effect of delays. At the same time, open the Andorran bank account—the due diligence on the Taiwanese funds is a lengthy process: allow four to eight weeks and prepare a comprehensive source-of-funds documentation package (five years of financial statements, Taiwanese tax returns, and transaction history).
Incorporation of the Andorran holding company and contribution of securities
Establish the Andorran company (SLU or SL), appoint the governing bodies, and contribute the shares of the Taiwanese companies or the designated financial assets. The contribution must be valued by a certified public accountant—the value determined establishes the basis for the mandatory investment and influences any potential tax issues upon exit on the Taiwanese side. The incorporation process takes two to four months.
Removal from the Taiwanese Household Registration System and Securing Tax Exemption
Complete the household registration removal (遷出戶籍) process at the relevant local government office in Taiwan. Coordinate with the Taiwanese tax advisor to ensure that the tax departure date is documented and that all pending Taiwanese tax filings are properly settled. Simultaneously establish permanent residence in Andorra—lease or deed of purchase, primary bank account, primary care physician, and registration with local services.
Submitting the residency application and obtaining the NIA
Submission to the Andorran Immigration Service. Issuance of the NIA (Administrative Identification Number), followed by the tax ID number. Renewal occurs two years after the initial issuance—and requires demonstrating an inflow of approximately €50,000 per year into an Andorran account. It is essential to ensure this inflow from the very first year. Total processing time: 8 to 14 months, depending on the complexity of the case.
Indicative reverse schedule
Mistakes to Avoid at All Costs
Mistake #1 — Confusing administrative residence with tax residence
Obtaining Andorran passive residency is not sufficient to renounce Taiwanese tax residency. The requirements for Andorran tax residency (six months of presence or center of economic interests) must be met separately. A Taiwanese national who spends only three months in Andorra without having established a holding company there must demonstrate their Andorran center of economic interests by other means.
Mistake #2 — Failing to deregister from the Taiwanese household registry
The household registration (戶籍) serves as an indicator of presumed tax residency in Taiwan. Failure to deregister may result in dual tax residency—even if all Andorran requirements are met. Coordination between the Taiwanese tax specialist and the Andorran team on this matter is critical.
Mistake #3 — Underestimating Taiwan’s withholding tax on dividends
In the absence of a tax treaty between Taiwan and Andorra, Taiwanese withholding tax on dividends paid to a non-resident foreign company can reach 21%. This tax burden must be factored into the profitability analysis of the arrangement. The use of an intermediary structure in a country that has a tax treaty with Taiwan can reduce this rate, but requires a specific analysis.
Mistake #4 — Waiting until you're "ready" before taking the first steps
Andorran residency quotas fill up without warning. An application prepared six months in advance can be submitted within hours of a decree being published. An application submitted after the decree is published is almost always too late. Preparing the application in advance is the only reliable strategy.
Mistake #5 — Opening an Andorran bank account too late
Due diligence on funds originating from Taiwan is particularly rigorous. Andorran banks require five years of tax and banking records, detailed documentation for each significant transaction, and may follow up with additional questions. It is advisable to begin this process at least six months before you need it.
Mistake #6 — Setting up an Andorran holding company with no real substance
An Andorran holding company must demonstrate genuine business activity and investments to avoid being classified as a “mailbox company.” Active Andorran bank accounts with financial transactions, locally maintained accounting records, and documented general meetings—substance is a requirement, not a mere formality.
Taiwanese nationals present a structurally favorable expatriation profile for Andorra: high tax rates in their home country, assets consisting mainly of corporate securities that can be transferred to a holding company, no inheritance tax upon arrival, and flexibility regarding physical presence thanks to the three-month minimum residency requirement. The main challenge—the absence of a bilateral tax treaty—requires rigorous structuring, but it is manageable with the right partners. Engage has expertise in these matters and possesses the network of local correspondents (in Taiwan, Asia, and Europe) necessary to coordinate all aspects of the process.
Your move from Taiwan to Andorra starts with an assessment
Existing structure, Taiwanese assets, family composition, succession goals: every situation is unique. Our experts analyze your situation and recommend the most appropriate strategy—from preparing your residency application to optimizing your group’s tax situation.
Schedule an appointment with an expertFAQ — Moving from Taiwan to Andorra
Can a Taiwanese national obtain Andorran residency?
Yes. Taiwanese nationals are eligible for the same residency statuses as all non-Andorran nationals: passive residency, residency for international professionals, and active residency. The requirements are the same—a €1 million investment for passive residency, a €50,000 AFA deposit, private health insurance, and a clean criminal record. There is no specific visa for Taiwanese nationals, nor are there any particular restrictions based on nationality.
Is the lack of a tax treaty between Taiwan and Andorra a deal-breaker?
No, but it requires a more rigorous structure. The absence of a treaty means that Taiwanese withholding tax on dividends paid to an Andorran holding company is governed by Taiwanese domestic law (up to 21%). This tax burden must be calculated and factored into the structure. Solutions exist—inserting an intermediate structure in a country with a treaty with Taiwan, or optimizing the nature of the cash flows (share premium rather than dividends, depending on the situation). The complexity is manageable, but it underscores the need for specialized advice.
What happens if I keep a property in Taiwan?
Real estate held for personal use in Taiwan may be considered by the Taiwanese authorities as a permanent residence, potentially maintaining a link to Taiwanese tax residency. The recommended solution is to transfer this property to a corporate entity (thereby avoiding personal ownership of a residence in Taiwan), lease it to third parties, or sell it. Property held through a corporation is not a “primary residence” for tax residency purposes.
How much time do you need to spend in Andorra to maintain residency?
For passive residency and residency with international ties: three months per year (minimum of 90 days). Presence must be documented—airline tickets, Andorran bank statements, local bills—to be admissible in the event of an audit. For active residency: a minimum of six months per year. These thresholds are considered administrative minimums for the renewal of the residence card, regardless of tax residency criteria (six months or center of economic interests).
Can I transfer my shares in Taiwanese companies to my Andorran holding company?
Yes. The contribution of shares in Taiwanese companies to an Andorran holding company is the primary strategy recommended for Taiwanese nationals. The contribution must be valued by a certified public accountant. The tax implications of the contribution on the Taiwanese side (potential taxation of capital gains on the sale) must be analyzed with a Taiwanese tax specialist. An Andorran Foreign Investment Authorization (AIE) is required before the holding company can subscribe to its shares, unless the client is already an Andorran resident.
What happens to my children if I transfer my estate from Andorra?
Andorra does not impose any inheritance or gift taxes on direct descendants. The transfer of shares in the Andorran holding company to heirs who are Andorran residents is tax-neutral. If your children reside in another country (France, Taiwan, the United States), that country’s inheritance tax laws may apply to assets received from Andorra—depending on the applicable law in the heir’s country of residence. Donating bare ownership during your lifetime (while retaining the right of usufruct) is the most effective way to mitigate this risk.
