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5.3. Tax Consolidation / Group Treatment

Consolidation is permitted subject to the following conditions:

  • Andorra resident entity holds, direct or indirectly, at least 75% participation in the other Andorran entities, during the entire tax year.
  • All group entities are taxable entities. In other words, tax exempt entities cannot be included in a tax group
  • Tax year of all the group entities aligns with the parent company’s tax year
  • Parent company intimates the Ministry of Finance, of the tax consolidation before the beginning of the tax year

Tax base for the group is the summation of the individual tax base of each group entity. Any profit/loss arising from transactions within the group is not considered, unless there is a corresponding transfer outside the group.