Personal Income Tax 2018 – PIT 2018

On 1st April, the Government of Andorra started its 2018 Personal Income Tax (PIT) collection campaign.

Who has to make an IRPF declaration?

PIT is a tax on the income of natural persons who are considered to be resident in Andorra for tax purposes. All income falls within the scope of PIT regardless of the place in which it arises or of the state in which the payer may be established. A person is liable to pay PIT if he or she spends more than 183 days in Andorra in any calendar year and if his or her economic activity or economic interests are principally based, whether directly or indirectly, in Andorra.

Cross-border workers who commute daily to Andorra from France or Spain and who are engaged by businesses which are themselves tax residents of Andorra, are not considered to be tax residents of Andorra. The income of cross-border and temporary workers will be subject to income tax for non-residents, and they may opt for the application of the special regime of that tax. The special regime allows them to pay tax under the general rules set forth in the PIT Act.

Exceptions

Taxpayers who receive income from real estate and income from employment (if any) which in aggregate are less than €24,000 in the tax year are not obliged to make a declaration. This rule also applies when the taxpayer, in addition to any income from real estate and employment as described, receives income from capital which has been subject to withholding or exempt income which, under Article 55 of the IRPF Act, does not fall to be declared for IRPF. However, if the taxpayer receives other income which is subject to IRPF, he or she must declare all his or her income with the sole exception of exempt income.

Taxpayers who only obtain earned income subject to withholding in excess of a total €24,000 can accept the proposal made by the Department for Taxes and Borders, and the acceptance of a proposal has the same effects as the submission of an income tax declaration.

Even so, the taxpayer must submit a declaration when he or she becomes aware of any discrepancy between the information in his or her records and that which appears in the proposal for the settlement of tax on earned income or when he or she has received income other than from employment which is not subject to settlement in this way.

Exempt income and income from capital which has been subject to withholding are not required to be declared.

Deadlines

The period for submission of declarations for the 2018 tax year is from 1st April 2019 to 30th September 2019.

Submitting your declaration

You should fill in Form 300 which can be submitted in person at the offices of the Department of Taxes and Borders (DTF) or electronically through the Department’s website.
In-person submission requires you to make an appointment at the following link: http://citapreviaat.govern.ad/InlineAppointments/

To submit your declaration electronically, you must enter your username and password into the Mòdul d’Identificació en Línia (MIL: Online Identification Module) in the DTF’s virtual office and follow the instructions at this link:
https://www.impostos.ad/images/stories/campanya_irpf18/ComFerDeclaracioOnlineIRPF.pdf

Preparing your declaration

To help you in preparing your income tax declaration, Andbank provides a summary statement for each of the accounts that you have with us.
You can access these statements via our home-banking platform (e-andbank) on Andbank’s website. You can find a guide by following this link.

News

Two new items of tax legislation came into force this year:
Firstly, the special system stipulated in the third transitional provision of the Tax Law is no longer applicable. Once the established period of three tax years has been exceeded, taxpayers with a residence permit and no gainful employment, the so-called passive residents, who opted for this alternative will have to begin to pay tax within the general system.

The 2019 Finance Law does in addition consider the possibility of deducting not only Andorra social security contributions, but also those made by taxpayers in any public social security system.