These "moves" generate a lot of controversy at a social and political level. Some poland telegram argue that everyone is free to decide where to live and others believe that those who earn more money should contribute more.
In our country, you pay more or less taxes depending on the wealth of each person. Personal income tax is a progressive tax that works in sections; that is, it increases as income grows.
First tranche up to 12,450 euros in which 19% is paid.
Second tranche up to 20,200 euros with a rate of 24%
Third tranche up to 35,200 euros with 30%.
Fourth tranche up to 60,000 euros with 37%
Fifth tranche up to 300,000 euros with 45%
Sixth tranche starting at 300,000 euros at 47%.
That is to say, a person in Spain can pay up to 47% of their income, while in Andorra the maximum to be taxed is 10% . So, if you have a high income, considering living in Andorra is not something unreasonable. In the end, each person, individually, seeks to earn as much as possible and reduce expenses as much as possible. If you are one of those who is thinking of changing address, it is best to put yourself in the hands of experts who can advise you so that you do not make any mistakes, for example at they help you with all the procedures from creating a company to opening a bank account in Andorra, you can count on them.
Who can pay taxes in Andorra?
If a person wants to link his or her income to the Andorran tax system, it is sufficient to make an effective transfer of residence. That is, rent or buy a home. In addition, it is necessary for the person to reside in Andorra for more than 183 days. Taxes can also be paid there if the core of the economic activities is located in the country. Therefore, it is not necessary to obtain nationality, only residency .
There are two types of residency:
Active: for all those whose main objective is to work in the territory, either as an employee of a pre-existing company or business or by creating a new company or business. In this case, you must remain for a minimum of 6 months.
Passive: for those who do not have the ultimate goal of working in Andorra, and simply want to live there. This would be the case for athletes, investors, scientists, artists, professionals with international projection, or retirees.
Spaniards who move to the Principality of Andorra usually create a company, which they can do as residents, thus obtaining residency and being able to pay taxes there. It is important to comply with the 183 days required by Andorran law, since failure to do so could result in a crime being committed.
Furthermore, not only must the number of days of residence in Andorra be met, but also the location of the base of the taxpayer's activities or economic interests must be taken into account . The General Directorate of Taxes has indicated that in order to determine where the main centre of economic interests is located, not only the income obtained by the taxpayer can be taken into account, but also the situation of his assets or expenses. Therefore, if you move to Andorra but your assets or businesses are still in Spain, the Treasury understands that you are a Spanish resident.
But in the case of influencers, streamers or YouTubers, it can be difficult to determine where exactly the profit or business is made , since views can be generated anywhere in the world.
One of the things that can happen is that a person is considered a tax resident in Spain and Andorra, and this is where the tie-breaker clause contained in the double taxation agreement signed between the two countries comes into play. This agreement establishes that, when a natural person is considered a resident in both countries, his or her situation will be resolved based on a series of variables:
Depending on the State where you have a permanent residence available to you. If you have a residence in both States, depending on where your centre of vital interests is, that is, the place where you have the closest personal and economic ties.