Portugal vs Andorra vs Cyprus: Tax Comparison for Entrepreneurs (2026)
Which pays less tax in 2026? We compare Portugal, Andorra, and Cyprus Non-Dom status — which achieves a ~5% effective rate for entrepreneurs.
Last updated: 2026-03-29
Quick Comparison: Portugal vs Andorra vs Cyprus Non-Dom
| 🇵🇹 Portugal | 🇦🇩 Andorra | 🇨🇾 Cyprus | |
|---|---|---|---|
| Corporate tax | 21% | 10% | 15% |
| Income tax | Up to 48% | Up to 10% | 0% (dividends) |
| Effective rate | ~25-30% | ~10% | ~5% |
| Dividend tax | 28% | 0% | 0% income tax, 2.65% GHS only |
| Cost of living | Medium | High | Medium |
| EU member | Yes | No | Yes |
Interactive Tax Calculator
Countries compared
Portugal
Effective rate
28%
Est. tax: €28,000
Andorra
Effective rate
10%
Est. tax: €10,000
Our recommendation
Cyprus (Non-Dom)
At ~5% effective rate, Cyprus saves you more than either country.
Effective rate
5%
Est. tax: €5,000
Annual savings vs Portugal
€23,000
Estimates based on effective rates. Consult a tax advisor for your specific situation.
Portugal vs Andorra: Detailed Analysis
With Portugal ending its NHR regime, many Spanish and Portuguese speakers are looking at Andorra as an alternative. Andorra offers a flat 10% tax on both personal income and corporate profits, with 0% on dividends. Portugal now charges up to 48% income tax and 28% on dividends. However, Andorra is not an EU member, has a tiny economy, and requires a EUR 400K deposit for residency. Portugal offers EU membership, a diverse economy, and a world-class lifestyle. The choice often comes down to: how much do you value EU access versus saving 30%+ on taxes?
Pros and Cons
🇵🇹 Portugal
Pros
- +EU membership and Schengen access
- +Golden Visa program (reformed 2023)
- +High quality of life, mild climate
- +Growing tech and startup ecosystem
Cons
- -NHR regime ended for new applicants (2024)
- -Standard income tax rates up to 48%
- -High social security contributions (~34%)
- -Dividend withholding tax at 28%
🇦🇩 Andorra
Pros
- +Low flat tax rate (10% max)
- +No dividend tax
- +Close to Spain and France
- +Safe, high quality of life
Cons
- -Not EU member, limited market access
- -Very small economy and market
- -Requires €400K deposit for residency
- -Limited international banking
Our Verdict
Andorra wins on taxes (10% flat), but lacks EU membership. Portugal has better lifestyle but much higher taxes since NHR ended.
The Alternative Most People Miss: Cyprus
You do not have to choose between EU membership and low taxes. Cyprus gives you both: EU membership with Schengen access, AND a ~5% effective tax rate through Non-Dom status. That is half what you would pay in Andorra (10%), with none of the limitations of a micro-state. The 60-day rule makes it even more flexible than Andorra, where you need 183 days of presence.
Cyprus Non-Dom: ~5% effective tax
The option most people overlook
- ✓EU member with full Schengen access
- ✓Non-Dom status: 0% tax on dividends (only 2.65% GHS)
- ✓~5% effective tax rate for entrepreneurs
- ✓60-day rule: tax residency with minimal presence
- ✓Mediterranean lifestyle, 340 days of sun
- ✓English widely spoken
Detailed Cyprus comparisons:
Frequently Asked Questions
Is Andorra or Portugal better for taxes?+
Can I keep EU residency if I move to Andorra?+
How much does Andorra residency cost?+
What about the Cyprus alternative?+
Is Portugal NHR still available in 2026?+
Which country is best for Spanish speakers wanting low taxes?+
Sources and References
Tax data: PwC Worldwide Tax Summaries, KPMG Tax Guides (2025/2026), Big Four country guides. Effective rates are approximations for entrepreneur structures (company + low salary + dividends). Consult a tax advisor before making decisions.
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Find Out If Cyprus Is Right for You
Our team helps you evaluate whether Cyprus Non-Dom status fits your situation. No commitment required.