Andorra doesn't have a tax-free threshold for employee gifts. Not a small one, not a seasonal one, none at all. Every euro of value an employer hands an employee, whether it's cash, a gift card, or a branded hoodie, is taxable income from the first euro. That puts Andorra in a different position from most other countries in this series, where you'll usually find at least a small annual allowance or a "customary gift" standard that shields modest gestures. Andorra's tax code doesn't offer either.
Why every gift to an employee is taxable in Andorra
Andorra's personal income tax, the Impost sobre la Renda de les Físiques (IRPF), is governed by Llei 5/2014. Article 29 sets out how in-kind employment income is treated: any benefit an employer provides to an employee, in cash, in kind, or as a voucher, is valued at market price and added to that employee's ordinary taxable salary for the year. There's no separate, lighter category for "gifts."
Article 29.2 does list a handful of exclusions from in-kind income, but it's a short, closed list: subsidised staff canteen meals, employer-paid accident and liability insurance premiums, and employer-paid education for employees' children. That's the entire list. Gifts, of any kind or occasion, aren't on it. A Christmas hamper, a company-branded hoodie, a gift card for a nice dinner out, a cash bonus dressed up as a "thank you": each one gets valued at what it would cost on the open market and taxed exactly like the rest of that employee's salary.
This is the single most important thing to understand about gifting in Andorra: there's no threshold to plan around. The question isn't "how much can we give before it becomes taxable" (the answer for every country in this series), because in Andorra it's taxable from the first euro.
The "occasional gratuity" rule — a labor-law distinction, not a tax break
There is one Andorran rule that gets misread as a gift exemption, so it's worth addressing directly. Andorra's labor code, Llei 31/2018, Article 81, covers "liberalitats de l'empresa" (employer gratuities). It says that an occasional and exceptional one-off payment or benefit from an employer doesn't get reclassified as a consolidated part of the employee's salary for labor-law purposes.
That matters for things like severance calculations and future salary baselines: an employer can hand out a genuine one-off gratuity without accidentally setting a precedent that raises the employee's "real" salary going forward. But it is a labor-law classification rule, not a tax exemption. It says nothing about IRPF, and it doesn't shield the gift's value from being taxed under Article 29.
Here's where it trips employers up: a gift only qualifies as "occasional and exceptional" if it isn't regular. An annual Christmas basket, given every December like clockwork, fails that test precisely because of its regularity. It stops looking occasional and starts looking like a recurring, expected element of compensation, which means it's treated as ordinary remuneration for labor-law purposes too, on top of always having been fully taxable under IRPF. Regularity is the thing that defeats Article 81, not generosity or gift value.
12 gift ideas
Since there's no threshold to design around in Andorra, the smartest approach is to pick gifts that are genuinely useful and well-made, and budget for the fact that their full market value will show up as taxable income on the recipient's payslip. Here are 12 branded merchandise options, priced in EUR, with materials, branding methods, and minimum order quantities.
1. Hoodie – The Rex
A heavyweight 280 gsm organic cotton hoodie that gets worn long after any gifting occasion is forgotten, and one of the most popular items in the catalogue.
- Material: 90% organic cotton, 10% polyester.
- Branding: embroidery, print, or patches.
- Order: MOQ 100 · from €40.09/unit.
2. Sports Socks
A low-cost, high-smile item that works well for a whole-team gesture without much per-head budget.
- Material: 80% cotton, 17% polyamide, 3% elastane.
- Branding: knitted-in logo zones.
- Order: MOQ 100 · from €4.00/unit.
3. Recycled Steel Bottle
A double-walled bottle made from recycled steel: genuinely useful, and a sustainability talking point in one gift.
- Material: recycled stainless steel.
- Branding: laser engraving or print.
- Order: MOQ 50 · from €11.00/unit.
4. A5 Notebook
A well-made notebook still earns its place on most desks, whether for meeting notes or as a simple desk accessory.
- Material: FSC-certified paper, PU cover.
- Branding: debossed or printed logo on the cover.
- Order: MOQ 100 · from €4.58/unit.
5. Premium Tote Bag
A sturdy tote leaves the office with people, on the commute, at the market, giving the branding real visibility relative to its price.
- Material: 270gsm cotton.
- Branding: print or custom straps.
- Order: MOQ 100 · from €6.44/unit.
6. Knitted Scarf
A genuinely useful winter gift for Andorra's mountain climate, with woven branding that reads as a step above a printed logo.
- Material: 80% viscose, 20% polyester.
- Branding: woven label.
- Order: MOQ 100 · from €7.66/unit.
7. Baseball Cap
A reliable pick for outdoor events and company outings; an embroidered logo tends to look more premium than the price tag suggests.
- Material: 100% cotton.
- Branding: embroidery.
- Order: MOQ 100 · from €8.34/unit.
8. Espresso Mug
A good espresso mug earns daily use at the office coffee machine, putting a logo somewhere people see multiple times a day.
- Material: glazed ceramic, dishwasher and microwave safe.
- Branding: printed or laser-etched logo.
- Order: MOQ 108 · from €8.44/unit.
9. Bamboo Tea Bottle
A bamboo exterior over a durable stainless steel interior gives a warmer look than an all-metal bottle, and works well as a mid-range gift.
- Material: stainless steel, bamboo.
- Branding: laser engraving or print.
- Order: MOQ 50 · from €18.70/unit.
10. RollTop Backpack
A water-resistant backpack with a laptop compartment that quickly becomes someone's everyday bag: a natural pick for a bigger single gift, such as a milestone anniversary.
- Material: GRS-certified recycled PU, water-resistant.
- Branding: print or embroidery.
- Order: MOQ 25 · from €24.57/unit.
11. Noise-Cancelling Headphones
A genuine step up in perceived value, and one of the pricier items on this list, so it's best reserved for a milestone gift rather than a routine one, especially since its full value counts toward taxable income either way.
- Material: recycled ABS, ANC + ENC, foldable.
- Branding: digital print or doming.
- Order: MOQ 50 · from €24.46/unit.
View Noise-Cancelling Headphones →
12. Wireless Powerbank
A magnetic wireless powerbank in recycled ABS plastic is genuinely useful for any commute or business trip, and a practical mid-range choice.
- Material: recycled ABS plastic.
- Branding: pad print or digital print.
- Order: MOQ 50 · from €18.39/unit.
What about client gifts?
Client and business-partner gifts sit under a completely different rule. Andorra's corporate tax, the Impost de Societats (Llei 95/2010), allows a deduction under Article 13.1.f for public-relations, customary-personnel, and promotional expenses, which covers reasonable gifts to clients and business contacts.
There's no per-gift value cap here. Instead, the deduction is capped in aggregate: these expenses can't exceed 1% of the company's average positive tax base over the current year and the two prior years. A single expensive client gift isn't automatically disallowed, but the whole pool of PR, customary, and promotional spend for the year is measured against that 1% ceiling. Andorra's standard corporate tax rate is 10%.
VAT (IGI) on promotional items
Andorra runs its own indirect tax, the Impost General Indirecte (IGI), governed by Llei 11/2012, separate from EU VAT. The general rate is 4.5%.
Two carve-outs are relevant to gifting. Free samples of no appreciable commercial value are exempt from IGI, with no value cap attached. Promotional printed materials and objects are exempt too, but only up to €100 per recipient per calendar year, and it's a genuine cliff-edge: cross that €100 line for a given recipient in a given year, and the exemption is lost, not just the excess above €100.
That €100 exemption reads as though it's aimed at promotional giveaways to clients and prospects rather than merchandise handed to employees, and we haven't been able to confirm how (or whether) it applies to employee gifts specifically. If IGI treatment of employee merchandise matters to your planning, that's a point worth checking with a local Andorran advisor rather than assuming either way.
Common mistakes
- Assuming Andorra works like Spain or France. Both neighbours give employers at least some breathing room for modest employee gifts. Andorra doesn't have an equivalent exemption at all: it's taxable from the first euro, full stop.
- Treating a recurring Christmas basket as an "occasional gratuity." Article 81's protection only applies to genuinely occasional, exceptional payments. An annual gift given every year fails that test on regularity alone, and it was always fully taxable under IRPF regardless.
- Assuming the €100 IGI promotional-item exemption covers employee merchandise. That exemption is built for promotional gifts to clients and prospects; its application to items given to employees isn't confirmed and shouldn't be assumed without checking with a local advisor.
This article is general information, not tax or legal advice. Andorran tax law changes, and individual circumstances vary, so confirm the current rules with a local gestor or tax advisor before running a gifting programme.
Planning a gifting programme for your Andorran team? Talk to Sunday about sourcing, branding, and shipping any of the items above, from a single small batch to a company-wide rollout.
