IGI and VAT share the same basic mechanism: the seller charges output tax, the buyer incurs input tax, and the difference is settled for each period. If you have kept VAT records, the concept of IGI takes five minutes to understand.

The mechanism is not the problem. The similarity encourages people to treat IGI as VAT with different percentages, when it is its own system. These are the differences that create work.

1. The rates do not map across

There is no conversion table between VAT and IGI rates. The percentages differ, and the categories do not group the same goods and services. A product at the reduced rate in one country may fall under the standard rate in the other.

Replacing VAT percentages with IGI percentages in foreign software may work for most lines and fail for a minority. Every quarter, someone then has to find that minority by hand.

Current tax rates Govern d'Andorra — Impost General Indirecte

2. There is an increased rate

IGI provides an increased 9.5% rate for banking and financial services. This category is specific to the Andorran system and often ends up modelled in foreign software as a "custom" rate without the rules that belong to it.

3. The Andorran tax register and NRT are not the Spanish NIF

The NRT is Andorra's tax registration number. Its purpose resembles the Spanish NIF, but its format and registry are different. Software that validates NIFs cannot validate an NRT correctly: at best it rejects the value, and at worst it accepts it without checking.

4. The tax forms are Andorran

IGI is filed using the models issued by the Department of Taxes and Borders, not another authority's forms. Software that exports a file for a different country does not remove the work; it moves it into an intermediate spreadsheet.

Models and filing Govern d'Andorra — formularis tributaris

5. Filing frequency depends on turnover

Filing frequency is not a preference: it is determined by turnover in the immediately preceding year, with specific rules for new activities and other cases. A generic calendar cannot tell you when your own return is due.

6. The chart of accounts is different

This is not strictly a tax difference, but it is where the process ends. Output and input IGI are recorded in accounts from the Andorran chart, and mapping accounts from another country's chart at every close is manual work that somebody pays for.

What to do next

If foreign software already works for you, there is no need to replace it tomorrow. First identify the weak points in the setup:

  1. List every invoice line using a rate other than the standard rate and verify its classification against the official source.
  2. Check whether client tax IDs are validated or stored as free text.
  3. Count the manual steps between the software's output and the return you file.
  4. Count the hours you spend on it each quarter. This number is what decides whether it's worth switching.