Moving to Andorra from the Netherlands: The Exit-Tax Trap and How to Plan It

Moving from the Netherlands to Andorra can cut your income tax from a top rate near 49.5% to a maximum of 10%. But Andorra is not in the EU, which changes everything about the Dutch exit. If you hold 5% or more of a company, the Belastingdienst issues a “conserverende aanslag” on the built-up value of your shares, and for a move outside the EU you must provide security and the assessment never expires. Dutch nationals also stay liable for Dutch gift and inheritance tax for ten more years. This move works — but only with proper Dutch and Andorran advice before you leave.

The upside

The Dutch top personal rate (Box 1) is 49.5%. A director-major shareholder (DGA) also faces Box 2 tax on dividends — 24.5% on the first €67,000 and 33% above — and Box 3 tax on wealth. Andorra caps personal income tax at 10%, has no wealth tax, and dividends from an Andorran company to a resident are tax-free. For a Dutch entrepreneur or investor, the annual saving is large and recurring.

The catch: the conserverende aanslag

If you hold a substantial interest (aanmerkelijk belang — 5% or more of a company’s shares) when you emigrate, the Dutch tax authority issues a conserverende aanslag: a preserving assessment on the difference between your shares’ value at emigration and their acquisition cost, at the Box 2 rates above.

Why Andorra is treated worse than an EU move

If you move to another EU or EEA country, you get an automatic, interest-free deferral and can pay over ten years — or the assessment is reduced as you actually sell shares or take dividends. Andorra is not in the EU or EEA, so:

• Deferral is not automatic — you must request it separately.
• You must provide security — a bank guarantee, a mortgage, or a pledge over the shares.
• Since 2015, the assessment for a substantial interest does not expire after ten years — it stays in place until the shares are sold, the company is liquidated, or significant dividends are paid.

In other words: the Dutch claim on the gain built up while you lived in the Netherlands follows you to Andorra indefinitely, and you have to post collateral for it.

The 2025 tax treaty

The Netherlands–Andorra tax treaty entered into force on 1 January 2025. Key points for someone relocating:

• Participation dividends (substantial holdings) are taxed only in the residence state — helpful once you are genuinely Andorran resident.
• Dutch pensions built up with tax relief remain taxable in the Netherlands (full source-state taxation) — emigrating does not move your Dutch pension into the 10% net.
• The treaty contains BEPS anti-abuse rules, so arrangements that exist mainly to obtain treaty benefits can be denied.

Gift and inheritance tax: the ten-year rule

Dutch nationals remain deemed resident of the Netherlands for gift and inheritance tax purposes for ten years after emigrating. If you gift assets or die within that decade, Dutch inheritance tax (up to 40%) can still apply — regardless of your Andorran residency. For a wealthy family this is often the more significant number than the income-tax saving, and it is the main reason succession planning has to start before the move, not after.

Box 3 and the year of departure

Your Box 3 wealth-tax liability ends when you cease to be a Dutch tax resident, pro-rated for the year. You will file a special M-biljet (migration return) for the year you leave.

Doing it properly

1. Model the exit before you move. Get a Dutch advisor who specialises in DGA emigration to quantify the conserverende aanslag, the security required, and the gift/inheritance exposure.
2. Consider the timing and structure of any pre-move reorganisation, dividend, or share transfer — with advice, because anti-abuse rules apply.
3. Set up the Andorran side — active residency through an Andorran company, or passive residency if you will not work — and be ready to spend the required days there (183 active, 90 passive) and to be genuinely, provably resident.
4. Keep clean records of your departure: deregistration from the Dutch municipal register (BRP), housing in Andorra, where your family and economic life now sit.

Frequently asked questions

Does the Netherlands have an exit tax when you move to Andorra?

Yes, if you hold 5% or more of a company. The Belastingdienst issues a conserverende aanslag on the unrealised gain in your shares. Because Andorra is outside the EU/EEA, you must provide security and the assessment does not expire after ten years.

How much is the Dutch exit tax?

It is calculated at Box 2 rates — 24.5% on the first €67,000 of gain and 33% above — on the difference between your shares’ value at emigration and their acquisition cost.

Will my Dutch pension be taxed at 10% in Andorra?

No. Under the 2025 treaty, tax-facilitated Dutch pensions remain taxable in the Netherlands even after you move.

Can the Netherlands still tax my estate after I move to Andorra?

For Dutch nationals, yes — for ten years after emigration, Dutch gift and inheritance tax can still apply.

Is moving from the Netherlands to Andorra worth it?

For a high earner or investor who will genuinely relocate, the recurring income and wealth-tax saving is substantial. Whether the one-off exit costs make sense depends on your shareholding, your unrealised gains and your succession plans — which is why this needs modelling before you commit.