Key Takeaways
- Monaco has 0% personal income tax; Andorra caps it at 10% (effective rate usually below 8%).
- Both have no wealth tax; Andorra also has 0% inheritance tax in the direct line and much lower VAT.
- Monaco banks expect a €500,000–1,000,000 deposit; Andorra needs a €1,000,000 investment (or €400,000 Housing Fund) plus a non-refundable €50,000.
- Monaco rents start around €3,500–5,000/month for one bedroom; Andorra is near Barcelona levels.
- Monaco suits the ultra-wealthy who want a zero-tax coastal address; Andorra suits people who want most of the benefit at a realistic cost.
Monaco has no income tax at all, but entry is expensive: banks expect a deposit of roughly €500,000–1,000,000 and rents start around €3,500–5,000 a month for a one-bedroom flat. Andorra taxes personal income at a maximum of 10% but costs a fraction as much to live in, with a €1,000,000 investment (or €400,000 via the Housing Fund) that you keep. Monaco suits the ultra-wealthy who want a zero-tax address; Andorra suits people who want most of the benefit at a realistic cost.
Tax
| Andorra | Monaco | |
|---|---|---|
| Personal income tax | 0–10% (caps at 10%) | 0% (except French nationals) |
| Corporate tax | 10% | ~25% on income if >25% of turnover is outside Monaco |
| Wealth / inheritance / gift tax | 0% | 0% wealth; inheritance 0% direct line, up to 16% others |
| Capital gains | Usually 0%; 10% otherwise | 0% |
| VAT | 4.5% | 20% (French VAT system) |
Monaco’s 0% personal income tax is genuine and hard to beat. But Andorra’s 10% ceiling, once you account for the 0–24,000 band and the 5% mid-band, produces an effective rate below 8% for most people — and Andorra’s consumption tax is a quarter of Monaco’s. For a business run from the jurisdiction, Andorra’s flat 10% corporate tax is far lighter than Monaco’s ~25% charge on companies with significant non-Monaco revenue.
Cost of entry
| Andorra | Monaco | |
|---|---|---|
| Capital requirement | €1,000,000 invested (or €400,000 Housing Fund) — you keep it | No legal minimum, but banks want €500,000–1,000,000 on deposit — you keep it |
| Non-refundable state payment | €50,000 + €12,000/dependent | None |
| Housing requirement | Adequate home, owned or rented | Own or rent property in Monaco — the binding constraint |
| Minimum presence | 90 days (passive) / 183 (active) | Must make Monaco your genuine main home |
Cost of living
This is the widest gap. A one-bedroom flat in Monaco rents for €3,500–5,000 a month; a family apartment can run to €10,000–25,000. Ongoing annual living costs for a single person are commonly put at €80,000–150,000. In Andorra, a comfortable single-person budget is around €2,500–3,000 a month and a family of four €4,500–6,000. Monaco is one of the most expensive places on earth to live; Andorra sits near Barcelona.
Lifestyle
- Monaco: Mediterranean, glamorous, dense, superb connectivity via Nice airport (30 minutes), a Grand Prix and a yacht harbour. Also crowded, expensive at every turn, and small.
- Andorra: alpine, quiet, outdoor-oriented, family-friendly, safe. Also isolated — no airport, long drives — and a long winter.
Who should choose which
Choose Monaco if a literal 0% income tax is the priority, cost is genuinely no object, and you want a coastal, high-society base with easy flights. Choose Andorra if you want most of the tax benefit — including the 0% wealth and inheritance treatment — at perhaps a tenth of the annual cost, and you value mountains, space and safety over glamour.
Frequently asked questions
Is Monaco or Andorra better for taxes?
Monaco has no personal income tax; Andorra caps it at 10% (effective rate usually below 8%). Both have no wealth tax. Andorra has far lower VAT and lighter corporate tax for a business run locally.
How much money do you need for Monaco residency vs Andorra?
Monaco has no legal minimum but banks typically require a €500,000–1,000,000 deposit you retain. Andorra requires a €1,000,000 investment (or €400,000 through the Housing Fund) plus a non-refundable €50,000 payment.
Is Andorra cheaper to live in than Monaco?
Dramatically. Monaco rents start around €3,500–5,000 a month for one bedroom; comparable housing in Andorra is a fraction of that, and overall living costs are near Barcelona levels.
Last reviewed: 3 September 2026. General information, not legal or tax advice; rules and prices in both jurisdictions change. Confirm with advisors in the relevant jurisdiction. Speak to our team.
