<\/span><\/h2>\n\nThis is the part that makes the difference and, at the same time, the one that causes the most mistakes when information written for investors from other countries is simply copied. If you are a tax resident in Andorra, neither Spain’s Modelo 720 nor the Spain-UAE treaty applies to you: your framework is different.<\/p>\n\n
The Andorra-UAE double taxation treaty<\/h3>\n\n
Andorra and the United Arab Emirates have a <\/span>double taxation treaty (DTT), in force since 1 August 2017<\/span>. Following the OECD model, its main lines for the investor are:<\/span><\/p>\n\n\n- Rental income<\/strong>:<\/span> the treaty allows it to be taxed in the country where the property is located (the UAE, at 0% for the individual). However, as an Andorran tax resident you are taxed on your <\/span>worldwide income<\/span>, so that rent is also included in your Andorran income tax (IRPF). Andorra applies the <\/span>credit method<\/span>: it deducts from your liability the tax paid abroad, which in the UAE is 0. In practice, <\/span>the rental income ends up being taxed in Andorra<\/span> at the rate that applies to you (0% up to \u20ac24,000; 5% between \u20ac24,001 and \u20ac40,000; and 10% above \u20ac40,000); it is not exempt.<\/span><\/li>\n\n\n\n
- Capital gain on the sale<\/strong>:<\/span> the treaty ties it to the country where the property is located (the UAE, at 0%) and Andorra taxes it under that same credit method. [To be confirmed by the tax team: the exact treatment of the capital gain on foreign property under Andorran IRPF.]<\/span><\/li>\n\n\n\n
- Dividends and interest<\/strong> (relevant if you invest through a company)<\/strong>: the treaty assigns taxing rights to the state of residence, so there is <\/span>no withholding at source (0%)<\/span>.<\/span><\/li>\n<\/ul>\n\n
Your obligations in Andorra<\/h3>\n\n
Unlike a Spanish resident, Andorra has <\/span>no foreign-asset declaration equivalent to the Modelo 720<\/strong>. That said, as an Andorran tax resident you are taxed on your <\/strong><\/span>worldwide income<\/strong> under IRPF<\/strong>, so income earned in Dubai must be correctly included in your Andorran return, applying the treaty mechanism described above.<\/span><\/p>\n\nIndividual or company: why it matters<\/h3>\n\n
Buying in your own name is the simplest option, but not always the most efficient. Depending on the size of the investment, whether you are after income or appreciation, and whether you foresee further international transactions, it may make sense to hold the purchase through a corporate structure. This is exactly the kind of decision best made before signing, because unwinding it afterwards is expensive or simply unfeasible.<\/p>\n\n
<\/span>Risks and points to bear in mind<\/span><\/h2>\n\nNo investment is risk-free, and Dubai is no exception. Before investing, keep in mind:<\/p>\n\n
\n- Market cycles<\/strong>:<\/span> Dubai property has gone through cycles of sharp rises and corrections, so the recommended horizon is medium to long term (3-5 years).<\/span><\/li>\n\n\n\n
- Liquidity<\/strong>:<\/span> selling a property is not immediate, and this has to be factored into your planning.<\/span><\/li>\n\n\n\n
- Currency risk<\/strong>:<\/span> the dirham (AED) is pegged to the US dollar, not the euro, so your return in euros will also depend on the EUR\/USD trend.<\/span><\/li>\n\n\n\n
- Regulatory and cultural differences<\/strong>:<\/span> it is advisable to rely on local advice and to check the developer and the contract carefully.<\/span><\/li>\n<\/ul>\n\n
<\/span>How Aug\u00e9 supports you<\/span><\/h2>\n\nAt Aug\u00e9 we advise Andorra residents investing abroad with one clear premise: returns are protected by structuring the investment well from the start<\/strong>. We analyse your case, define the most efficient ownership structure, review the fit with the Andorra-UAE treaty and support you through the process and your obligations in Andorra.<\/span><\/p>\n\n<\/span>Frequently asked questions<\/span><\/h2>\n\nIs there a minimum amount to buy a property in Dubai?<\/h3>\n\n
There is no legal minimum to buy. The relevant threshold comes into play if you are after residency: a purchase of AED 2 million (around \u20ac500,000) gives access to the 10-year Golden Visa, as we explain below.<\/p>\n\n
<\/p>\n","protected":false},"excerpt":{"rendered":"
Dubai has become one of the favourite destinations for international real estate investors, and a growing number of Andorra residents are considering diversifying part of their wealth there. The logic is clear: two tax-efficient jurisdictions, a growing property market and the possibility of operating almost entirely remotely. That said, the return on this kind of […]<\/p>\n","protected":false},"author":7,"featured_media":14816,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[111],"tags":[],"class_list":["post-17871","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-taxation"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/posts\/17871","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/comments?post=17871"}],"version-history":[{"count":2,"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/posts\/17871\/revisions"}],"predecessor-version":[{"id":17885,"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/posts\/17871\/revisions\/17885"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/media\/14816"}],"wp:attachment":[{"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/media?parent=17871"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/categories?post=17871"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.augelegalfiscal.com\/en\/wp-json\/wp\/v2\/tags?post=17871"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}