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Andorra Publishes New Law on Exceptional and Urgent Measures in Response to the COVID-19 Pandemic — Orbitax Tax News & Alerts

Andorra has published Law 5/2020 of 18 April 2020 on exceptional and urgent measures in response to the COVID-19 pandemic. The Law updates and replaces the prior law on exceptional and urgent measures, Law 3/2020 of 23 March 2020.

The tax relief measures provided in Law 5/2020 include the following:

  • Taxpayers that are unable to pay their tax debts as a result of the COVID-19 pandemic may request the deferral or splitting of the tax debt, without guarantees or late payment interest, even if the tax debt corresponds to withholdings, income on account, or tax penalties;
  • Advance corporate tax payments are reduced to 20% of the previous year's tax liability for taxpayers with a financial year beginning between 1 July 2019 and 31 May 2020;
  • The tax base for VAT is reduced by rental (lease) income not received due to rent relief measures for business premises (provided in separate measures of Law 5/2020);
  • Rental (lease) income not received due to rent relief measures for business premises is excluded from the tax base for corporate tax, non-resident income tax, and personal income tax, while related expenses remain deductible;
  • Administrative deadlines for the processing all types of files and for fulfilling obligations of any nature are suspended from 14 March 2020 until the state of emergency is lifted; and
  • Statute of limitations and expiration periods are suspended from the date of the Law's entry into force until the state of emergency is lifted.

Law 5/2020 was published and entered into force on 30 April 2020.