In France, interest and dividends received by an individual are subject in 2026 to the flat-rate withholding tax (PFU) of 31.4%. In Andorra, a person with tax residence in the Principality pays a maximum of 10% personal income tax (IRPF) on savings income, after an exemption of 3,000 euros per year. You do have to genuinely live there: opening an account in Andorra while remaining tax resident in France changes nothing about French taxation. Here is how to invest your money in Andorra depending on your situation, and what each option entails.
Key points
- Three banking groups are licensed by the Andorran Financial Authority (AFA): Andbank, Creand and MoraBanc.
- Deposits are guaranteed up to 100,000 euros per depositor and per institution, and deposited securities benefit from separate protection of the same amount.
- A saver domiciled in Andorra is exempt on the first 3,000 euros of savings income each year, then taxed at a maximum of 10%.
- Neither wealth nor inheritance is taxed locally.
- A saver domiciled in mainland France remains subject to the flat tax (PFU) of 31.4% in 2026, must declare the account, and their banking data is automatically transmitted to the French tax authorities.
The Principality's banking system: where and how to invest your money
Investing your money in Andorra means first entrusting it to a financial centre specialising in private banking and wealth advisory. The Principality has the euro as its official currency under the monetary agreement concluded with the European Union in 2011, and its banks apply OECD transparency standards. Contrary to a widespread belief, an account opened locally is neither anonymous nor opaque: it is a European bank account, with an offering geared more towards investment than towards day-to-day banking.
Three banking groups licensed by the AFA: Andbank, Creand and MoraBanc
The banking sector today comprises three groups, all licensed and supervised by the Andorran Financial Authority (AFA): Andbank, Creand (formerly Crèdit Andorrà) and MoraBanc. The "five Andorran banks" still cited by many websites belong to the past: Vall Banc was integrated into Creand, and MoraBanc absorbed BancSabadell d'Andorra following its acquisition at the end of 2021. These three institutions cover both everyday services and private banking, and each has investment and insurance subsidiaries in several countries. Their entry conditions, however, differ appreciably, in particular the minimum amounts required to entrust a mandate.
The investments offered: deposits, securities accounts, discretionary management and life insurance
Andorran banks offer the same product families as a major European private bank, with two notable differences: the absence of regulated savings products and the prominence given to multi-currency accounts. There is no equivalent of the French Livret A: the rate on a term deposit or an interest-bearing account is set freely by each institution. Beyond deposits, the range of services covers:
- the securities account, for holding shares, bonds and funds across every asset class;
- advisory or discretionary management, in which your adviser applies an investment policy defined with you;
- the funds of the investment companies attached to the banking groups;
- the life insurance and retirement savings contracts of their insurance subsidiaries.
Accounts may be held in several currencies, an advantage for assets exposed to the dollar or the Swiss franc.
Deposit guarantee: 100,000 euros per depositor and per institution
Deposits are protected by the Andorran deposit guarantee fund (Fons Andorrà de Garantia de Dipòsits, FAGADI) up to 100,000 euros per depositor and per institution, pursuant to Llei 20/2018 of 13 September 2018. Deposited securities fall under a separate scheme, the SAGI (Sistema Andorrà de Garantia d'Inversions), within the same limit of 100,000 euros. For a joint account, each ceiling applies to each holder separately. Beyond these amounts, the security of your money rests on the soundness of the institution, supervised by the AFA under prudential rules aligned with those of the European Union.
Residing in France or in Andorra: what determines the taxation of your investments
Where your account is held does not determine how your investments are taxed: your country of residence does. The France-Andorra tax treaty, signed on 2 April 2013 and in force since 1 July 2015, allocates taxing rights between the two countries on that basis. A French national living in mainland France who invests on the other side of the Pyrenees remains taxable in France on all income, wherever it is received. Conversely, someone who has moved their home and the centre of their economic interests to the Principality is subject to IRPF on savings income. Two situations, two regimes:
| Criterion | You reside in France, with an account in Andorra | You reside in Andorra |
|---|---|---|
| Country taxing interest and dividends | France | Andorra |
| Rate in 2026 | Flat tax of 31.4%, or progressive scale by election | 10% maximum after the first 3 000 € exempt |
| Capital gains on securities | Flat tax of 31.4% | Exempt subject to shareholding and holding-period conditions |
| Wealth | IFI on net real estate above 1.3 M€ | No wealth tax; IFI may still be due on property held in mainland France |
| Reporting obligations | Income tax return and account reporting (form 3916) | IRPF return in Andorra |
Where are your investments taxed?
It all depends on your residence
The location of the account does not change the country of taxation. 2026 rates.
How are the investments of a saver domiciled in Andorra taxed?
A person living locally declares their financial income in the savings base of the IRPF, separate from the general base covering salaries, pensions and business income. This compartment follows simple rules, set out in Llei 5/2014 of 24 April 2014 on the IRPF.
Savings income: 3,000 euros exempt, then 10%
Interest, dividends and taxable capital gains make up the savings base. The first 3,000 euros are exempt each year (article 37 of Llei 5/2014), after which the balance is taxed at a single rate of 10%. Unlike salaries, this income benefits neither from the personal allowance of 24,000 euros, which applies only to the general base, nor from the 50% reduction reserved for that base. Two categories, however, fall outside the IRPF: dividends paid by local companies subject to corporate income tax, and those from collective investment undertakings governed by Andorran law. For foreign-source income, the withholding tax suffered abroad is deductible from the IRPF, up to the portion of the IRPF attributable to that same income.
Capital gains on securities: exempt up to a 25% holding
The gain realised on the sale of shares, bonds or fund units falls in principle within the savings base. It is nonetheless exempt in the great majority of wealth situations: it is enough that the seller, alone or together with close relatives and related companies, has not held more than 25% of the capital or voting rights of the company during the twelve months preceding the sale (articles 5 and 24 of Llei 5/2014). Above 25%, the exemption still applies if the securities have been held for at least ten years, except where at least half of the company's assets consists of locally situated real estate. For a diversified portfolio of listed securities, capital gains are therefore not taxed.
Wealth and inheritance: no local taxation
Andorra taxes neither wealth nor inheritance. The value of a portfolio is never taxed as such, and its transfer to heirs triggers no local levy. Note, however, that the country where the heirs live may apply its own rules.
| Income or asset | France (2026) | Andorra (2026) |
|---|---|---|
| Interest | PFU of 31.4% | 10%, after 3,000 € exempt across all savings income |
| Dividends from foreign companies | PFU of 31.4% | 10%, foreign withholding tax deductible |
| Dividends from Andorran companies | PFU of 31.4% | Exempt |
| Capital gains on securities (holding up to 25%) | PFU of 31.4% | Exempt |
| Portfolio value | Not taxed (the IFI covers real estate only) | Not taxed |
| Inheritance in direct line | Duties up to 45% | No duties |
By way of illustration, take a portfolio of 1,000,000 euros invested in bonds and foreign shares, yielding 3% per year: 15,000 euros of interest and 15,000 euros of dividends, i.e. 30,000 euros of income. For clarity, foreign withholding taxes, deductible in both countries, are set aside.
- Saver subject to the PFU: 30,000 × 31.4% = 9,420 euros of PFU.
- Saver subject to the IRPF: (30,000 − 3,000) × 10% = 2,700 euros of IRPF.
The difference reaches 6,720 euros per year, an effective rate of 9% against 31.4%. If this portfolio also produces a capital gain of 50,000 euros on resale, that gain costs 15,700 euros under the PFU and remains exempt in the Principality, as long as the holding in each company does not exceed 25%.
Portfolio of 1,000,000 €, yield of 3%
30,000 € of income: PFU or IRPF
Capital gain of 50,000 € on resale: 15,700 € under the PFU, exempt in Andorra as long as each holding does not exceed 25%.
Illustrative example, foreign withholding taxes set aside.
Indicative calculation based on 2026 rates. Foreign withholding taxes, capital gains and fees are not taken into account.
Investing money in Andorra without living there: what a bank account opened from France entails
Nothing prevents a saver resident in France from opening an account there and investing through it. This choice does not change their tax treatment or their reporting obligations, however: it actually adds a few, which the tax authorities now monitor without difficulty.
Opening an account without living there: possible, subject to review
All three banking groups accept foreign clients, provided a complete file is submitted: proof of identity, proof of address, proof of the source of funds and, often, a presentation of the investment plan. Anti money laundering requirements, supervised by the Financial Intelligence Unit (Unitat d'Intel·ligència Financera, UIFAND), make the source of capital decisive. A visit in person is generally required, and minimum entry amounts are significantly higher for high net worth clients. The steps are set out one by one in our guide to opening an account in Andorra.
French taxation: the 31.4% flat tax applies to income from the account
Interest, dividends and capital gains from the account are taxable on the same terms as if they had been received in Paris: a flat tax of 31.4% in 2026, that is 12.8% in income tax and 18.6% in social levies, or the progressive scale by global election. One major practical difference: the foreign institution withholds neither the 12.8% advance payment nor the social levies. The account holder must pay them personally before the 15th of the month following each receipt, using form 2778 for interest and form 2778-DIV for dividends (articles 125 D and 117 quater of the French General Tax Code, CGI). The income is then reported in the annual tax return (form 2047).
Reporting the account: form 3916 and automatic exchange of information
Any account held outside France must be reported each year with the income tax return, on form 3916, even if it has been inactive (article 1649 A of the CGI). Failure to do so carries a fine of 1,500 euros per account and per year, in addition to back taxes and penalties if income went unreported. The chance of going unnoticed is nil: the jurisdiction has applied the OECD Common Reporting Standard (CRS) since Law 19/2016 of 30 November 2016. Since 2018, local institutions have reported the balance and income of their foreign clients' accounts every year, and that data reaches the DGFiP.
Warning
An account opened in Andorra must be declared every year on form 3916, even if it has not been used. Failing to do so costs a 1,500 euro fine per account and per year.
Banking secrecy: an outdated argument
Contrary to a persistent belief, Andorra is no longer an opaque jurisdiction: account secrecy can no longer be invoked against foreign tax authorities, account data circulates automatically and a double taxation treaty links the country to Paris. An account opened there serves to diversify a portfolio, to gain access to private banking and to hold assets in several currencies, not to shield income from the tax authorities. One final point: article 25 of that same treaty allows Paris to tax its nationals who settle there as if the treaty did not exist, but this clause can only apply if domestic law provides for it, which is not the case to date.
Real estate and holding companies: two other ways to invest your capital
A securities account is not the only point of entry. Property and holding companies meet other objectives, under rules that have become considerably stricter since 2024.
Real estate: prior authorisation and a specific tax
The purchase of a property by a person who does not live in the country is subject to prior administrative authorisation. Llei 5/2025 of 6 March 2025 on sustainable growth and the right to housing, known as the omnibus law, further limits such acquisitions, like those of people settled for less than three years, to one single-family house or two apartments. To this is added the tax on foreign real estate investment created by Llei 3/2024 of 1 February 2024: since Llei 2/2026, in force on 13 February 2026, it reaches 6% for a first property and 10% beyond that, on top of transfer duties. A quick resale finally triggers a capital gains surcharge. The market and its rules are set out in detail in our guide to investing in property there.
Holding company: profits taxed at 10% at most and a substance requirement
A local holding company may hold securities, shareholdings or buildings, with taxation of profits capped at 10% and dividends exempt from IRPF for a partner who is himself domiciled in the country. This framework requires genuine substance: premises, resources and effective local management. For a partner domiciled in France, the benefit is limited: article 123 bis of the CGI allows the profits of a structure subject to a privileged tax regime in which he holds at least 10% to be taxed in his hands.
Changing your domicile: the conditions to be met in order to fall under IRPF
The regime described above presupposes genuine domicile in the country, which involves two distinct steps: obtaining a residence permit, then transferring your domicile for IRPF purposes.
Active or passive residence: presence, payment to the AFA and investment
A residence permit is obtained either by carrying on an activity in the country, or without gainful activity: this is known as passive residence. Since Llei 2/2026 of 22 January 2026, this second route requires an investment of at least 1 million euros in the local economy (400,000 euros if it is allocated to the public housing fund), a non-refundable payment of 50,000 euros to the AFA, increased by 12,000 euros per dependant, and 90 days of presence per year. The residence permit is not sufficient in itself: for IRPF purposes, you must stay more than 183 days a year in the country or have the centre of your economic interests there, two criteria set out in detail in our guide devoted to establishing domicile in Andorra.
Leaving France: effective domicile and exit tax
On the departure side, the tax authorities examine the household, the main place of stay, the activity and the centre of economic interests (article 4 B of the CGI). A company director holding substantial shareholdings may also be subject to the exit tax (article 167 bis of the CGI). This is the stage at which our Engage teams step in: residence permit application, coordination with the tax advisers remaining in France and the timetable for the change of domicile.
Changing your domicile
From the residence permit to IRPF: four steps
Steps summarised from the article.
The four costly mistakes
First mistake: believing you are domiciled in Andorra because you hold a residence permit, while your household and most of your time remain in France. The tax authorities then reclassify the departure, with back taxes and penalties as a result.
Second mistake: overlooking form 3916 or the instalment due on income from an account held abroad. These are precisely the omissions that the automatic exchange of information brings to light.
Third mistake: confusing the headline rate with the actual tax burden. The 10 % applies after the 3 000 euro exemption, so the effective taxation remains below that rate.
Final mistake: underestimating the entry amounts required and the fees charged, which can absorb part of the savings achieved.
FAQ
Can you invest your money in Andorra without living there?
Yes. A saver domiciled in France can open an account subject to review of the file, but the income remains subject to the French flat tax of 31.4 % in 2026 and the account must be declared each year on form 3916. There is no regulated savings scheme in Andorra: the return on deposits is set freely by each institution.
Is Andorra still a tax haven?
No. Account confidentiality can no longer be invoked against foreign tax authorities, and institutions have automatically transmitted data on their foreign clients under the OECD CRS standard since 2018.
How much does a saver subject to Andorran IRPF pay on financial income?
The first 3 000 euros of savings income are exempt each year, then the balance is taxed at 10 % under IRPF. Capital gains on securities are exempt as long as the holding in the company does not exceed 25 %.
Is my money protected if the institution fails?
Yes, within certain limits. Deposits are guaranteed up to 100 000 euros per depositor and per institution, and securities held in custody benefit from separate protection of the same amount.
