Invoicing and Tax regulation in Andorra

Invoicing Regulation in Andorra

Invoicing regulation in Andorra is governed by the Invoice Directive that stipulates the essential elements that must be present in an invoice. For B2B, B2C, and B2G, invoices must include details such as the date of issue, a unique identification number, the supplier's tax identification number, the customer's full name and address, a clear description of quantity and type of goods supplied or services rendered, the date of transaction, and the VAT amount payable. Fully adhering to these invoice rules is mandatory under the Andorra invoicing laws.

Real-time Reporting / Fiscalization

Andorra does not have specific laws relating to real-time reporting or fiscalization for B2C, B2B, or B2G businesses. However, companies must ensure their fiscal reports are in compliance with the Andorran Accounting Plan (PAC), which is similar to the international accounting standards.

E-Invoicing

Andorra currently has no standardized regulations regarding the use of e-invoicing for B2B, B2G, or B2C businesses. However, electronic invoices are commonly used and accepted in practice, provided they are in compliance with the general invoicing regulations.

VAT / GST / Tax Compliance

Andorran tax law requires businesses involved in both B2B and B2C transactions to register for General Indirect Tax (IGI), which is the equivalent of VAT/GST in the Principality of Andorra. This tax rate is set at a general rate of 4.5%, although reduced rates of 1% and 2.5% apply to certain goods and services. For B2B transactions within the European Union, the reverse charge mechanism can be applied. For B2G contracts, it is not mandatory to include VAT. However, authorities must account for VAT if a supplier charges it. Compliance with IGI/VAT tax obligations and regular filings are mandatory for businesses to operate in Andorra.

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