France shares a border with Andorra, a tax treaty with it since 2016, and a long history of sending relocating entrepreneurs south across the Pyrenees. For a French resident weighing the move, Andorra offers a genuinely low tax bill a short drive from home, but the exit from the French system needs planning as much as the arrival. This guide sets out both sides: what you leave, what you land in, and how the two connect.
A short drive from home
France-Andorra tax treaty
Andorra income tax ceiling
On the French exit
Last updated: 22 July 2026
By: Alexander Thornbury
Why French buyers choose Andorra
France is one of Andorra’s most natural corridors. The two share a border, so a French family can relocate without leaving the region, and Andorra has long drawn French entrepreneurs, online-business owners and traders looking for a lower tax base within easy reach of home. The appeal is simple: a top income tax rate of 10%, no wealth tax, no inheritance or gift tax, against a French system that taxes income steeply and levies IFI on real estate.
The catch is that Andorra is a relocate-and-live destination, not a second-home tax play. The benefit follows genuine tax residency, and a French buyer keeping their life in France gains little. For the full framing, see our international buyer’s guide to Andorra property.
What you leave behind in France
Leaving French tax residence is a deliberate legal step, not simply a matter of buying elsewhere. France taxes worldwide income and levies IFI, the real-estate wealth tax, on French residents, and it applies an exit tax on unrealised gains for those leaving with substantial holdings. The precise thresholds and mechanics turn on your specific position, so the one firm instruction here is to take French tax advice before you move, not after.
French-situated assets you keep, notably French real estate, generally remain within the French net even after you leave, so a clean move is about breaking residence properly and understanding what stays taxable in France. This is the part French buyers most often underestimate, and it is where the value of good advice is highest.
What you land in
Andorra’s regime is the reason for the move. Income tax tops out at 10%, with nothing on the first EUR 24,000. There is no wealth tax, no inheritance tax and no gift tax. The consumption tax, IGI, is 4.5%. Buying a home carries the Foreign Investment Tax, but at 6% on a single home, it is a real cost to budget for.
Residency is the mechanism that unlocks all of it. Passive residency requires EUR 1,000,000 invested in Andorran assets, or EUR 400,000 via the Housing Fund, plus a non-refundable deposit and 90 days a year of presence. The full detail is in our Andorra residency guide and tax guide.
| For a relocating buyer | France (as resident) | Andorra (as resident) |
|---|---|---|
| Top income tax | High, progressive | 10% |
| Wealth tax on real estate | IFI applies | None |
| Inheritance and gift tax | Applies | None |
The treaty and breaking French residence
France and Andorra have had a double-tax treaty in force since 2016, which is a real advantage for this corridor. It governs how income and gains are allocated between the two countries and gives a framework for a clean transition, which buyers moving from a country with no Andorran treaty do not have. It does not, however, remove the need to break French tax residence properly.
French tax residence turns on tests of home, main activity and centre of economic interest, and Andorran tax residence turns on spending more than 183 days a year there or centring your interests there. Meeting the Andorran residency permit’s 90-day floor is not the same as becoming Andorran tax-resident. Coordinating the French exit and the Andorran arrival, with advisers on both sides, is what makes the move work.
Getting there
This is the corridor’s practical strength. Andorra has no airport, but from France it is reached by road, roughly two and three-quarter to three hours from Toulouse-Blagnac, crossing the border near Pas de la Casa. For a French buyer, the drive home is short enough that relocation does not mean cutting ties with France or family.
That proximity is much of why the France-Andorra corridor is so well established. A French entrepreneur can base themselves in Andorra for the tax residency and still reach Toulouse, Barcelona or the wider region easily. It is a genuine move, but not a distant one, which suits buyers who want the tax benefit without leaving their world behind.
| Passive residency at a glance | Detail |
|---|---|
| Investment | EUR 1,000,000 in Andorran assets, or EUR 400,000 via the Housing Fund |
| Government deposit | EUR 50,000 + EUR 12,000 per dependant, non-refundable |
| Physical presence | 90 days a year minimum |
Key takeaways
- France borders Andorra and has a tax treaty with it since 2016, making this one of the most natural corridors.
- Andorra offers a 10% top income tax and no wealth, inheritance or gift tax, against France’s steeper system and IFI.
- Breaking French residence needs planning, including France’s exit tax on substantial holdings. Take French advice before moving.
- Passive residency needs EUR 1M, or EUR 400k via the Housing Fund, plus a non-refundable deposit and 90 days a year.
- It is a short drive from Toulouse, so relocation does not mean leaving the region.
Frequently asked questions
Why do French people move to Andorra?
For a low tax base close to home: a 10% top income tax, no wealth tax, and no inheritance or gift tax, against France’s steeper income tax and its IFI real-estate wealth tax. Andorra shares a border with France, so the move stays within the region.
Is there a tax treaty between France and Andorra?
Yes, in force since 2016. It governs how income and gains are shared between the two countries and gives a framework for a clean transition, an advantage this corridor has over countries with no Andorran treaty.
Does France have an exit tax?
France applies an exit tax on unrealised gains for those leaving with substantial holdings, and taxes French-situated assets even after departure. The thresholds and mechanics depend on your position, so take French tax advice before moving.
How long does it take to drive from France to Andorra?
Roughly two and three-quarter to three hours from Toulouse-Blagnac, crossing the border near Pas de la Casa. Andorra has no airport, so road access from France is the practical route.
Do I have to actually live in Andorra to get the tax benefit?
Yes. The benefit follows Andorran tax residency, which means more than 183 days a year there or your centre of economic interest there. A French buyer keeping their life in France gains little from the move.
How much do I need to invest for Andorra residency?
Passive residency requires EUR 1,000,000 in Andorran assets, or EUR 400,000 via the Housing Fund, plus a non-refundable deposit of EUR 50,000 plus EUR 12,000 per dependant, and 90 days a year of presence.
Sources
- Govern d’Andorra – Andorran tax, residency and the France-Andorra double-tax convention (2016)
- Direction generale des Finances publiques (France) – French residence, IFI and exit tax
Figures current at July 2026. The French exit and the Andorran arrival should both be planned with qualified advisers before you move.
About the author
Alexander Thornbury is a published author who writes on international property, tax and residency for high-net-worth buyers across Europe. His work focuses on the practical mechanics of cross-border purchase: what a buyer actually pays, owes and signs. More at alexanderthornbury.com.