Your company owns the car and you are moving to Andorra. The question is not which car to buy, you already have it. It is how to move it cleanly from one company to another. Here is how the operation works, in what order, with which documents, and on what conditions it holds.
The situation
This is a common case among new Andorran residents: the vehicle belongs to a company in France, Spain or the United Kingdom, often partly written down, and the owner moves their activity or their residence to Andorra. The car has to follow.
This is not a purchase. It is a sale between two separate legal entities, followed by an export and a registration in another country. Three operations, in that order, each with its own formalities.
Andorra is a third territory, even without customs duty
This is the point most people get wrong. The European Union and Andorra are bound by a customs union covering chapters 25 to 97 of the tariff, which includes motor vehicles. In practice, no customs duty is payable.
However, customs formalities are maintained in full, and Andorra remains a third territory for consumption tax. The vehicle therefore does leave the tax territory of the Union, with an export declaration, even though no duty is collected. For a vehicle leaving the United Kingdom, the same logic applies under UK export rules.
The four steps
1. The sale between the two companies
The existing company sells the vehicle to the Andorran company. It is a sale between two legal entities, with an invoice and a transfer document. Two requirements frame this step: the price must match the market value of the vehicle, and the disposal produces a taxable result in the country of the selling company, which your accountant will book at year end.
These two points are not formalities. They are what separates a solid operation from a fragile one.
2. The export
The export is declared to the customs office covering the exporter. A supply dispatched outside the European Union is exempt from VAT, subject to proof that the goods have left. A used vehicle leaves under its current registration; in France, export registration documents no longer exist, and a new vehicle leaves under a temporary WW certificate valid for one month, renewable once.
Keep the full export file. It is the evidence that supports the exemption.
3. Entry into Andorra
On entry, the Andorran company pays IGI, the Andorran equivalent of VAT, at 4.5 % of the declared value of the vehicle. This is the main cost of the operation, and it is also what explains the gap with a French registration at 20 % VAT, a Spanish one at 21 % VAT plus up to 14.75 % registration tax, or a British one at 20 % VAT.
4. Registration in the Andorran company name
The vehicle passes the Andorran technical inspection, the ITV, and the Departament de Mobilitat then issues the permís de circulació in the company name. The official first registration fee is 250 EUR. The processing time announced by the Govern is a maximum of 48 hours once the file is complete.
Documents to gather
| Step | Documents |
|---|---|
| Sale | Sales invoice between the two companies, transfer document, incorporation papers of the Andorran company |
| Export | Export declaration, invoice, copy of the current registration certificate |
| Entry into Andorra | Invoice, proof of value, identity documents of the company representative |
| Registration | European Certificate of Conformity, ITV inspection report, proof of IGI payment |
The three conditions that decide whether it holds
- The Andorran company must have real activity. A structure set up for the sole purpose of holding a vehicle does not survive scrutiny. This is the first condition, before any consideration of cost.
- The sale price must be a market price. Between related companies, a convenience price is the first thing a tax authority looks at.
- The vehicle must be used from Andorra. A resident of Spain has 30 days to register a foreign-plated vehicle there. France applies the abuse of law procedure, with a penalty of up to 80 % of the tax avoided. In the United Kingdom, HMRC must be notified within 14 days of a vehicle arriving.
What this operation is not
It is not a way around an emissions tax on a car that will keep driving at home. Nor is it a neutral operation: it produces a taxable result on the selling side and it assumes an Andorran company that genuinely exists, with the obligations that come with it.
It makes sense when the move of residence or activity is real and the vehicle follows its owner. In that case, it is fully framed by the rules.
Frequently asked questions
Does the Andorran company have to exist before the sale?
Yes. The Andorran company is the buyer. It must be incorporated and registered before the sale can take place. Allow 6 to 12 weeks to set up an SLU.
Can the car be driven at home after the transfer?
Occasionally, like any foreign-plated vehicle. In permanent use by a resident, no: that is exactly the situation tax authorities reclassify.
Who handles the formalities?
The home-country side is for your accountant and a customs agent. The Andorran side is handled by a local gestoria, which manages the IGI, the ITV and the registration. That second part is where we come in.
Where to start
The starting point is always the same: check that your situation meets the three conditions above. Our four-question eligibility check tells you in thirty seconds. We then shortlist the Andorran provider that handles this type of file, and you receive a quotation within 24 working hours.
The legal and tax structuring on your home-country side is a matter for your usual adviser. This article describes a procedure, it does not replace the opinion of a legal or tax professional.
Sources: French customs authority, guidance on exporting a motor vehicle outside the European Union and on the EU customs unions with Andorra and San Marino. Spanish tax agency, driving with foreign plates and habitual residence. GOV.UK, importing vehicles into the UK. Govern d’Andorra, procedure GV000365.