A visa is an authorization stamped on the passport of an individual. It is granted by the nation where he or she wants to visit, live, or work. There are student visas, work visas, tourist visas, and transit visas. But have you heard about golden visas? Yes, several countries in the EU (read Portugal and Greece) offer golden visas to foreign nationals in exchange for investment in real estate. For example, a golden visa program of Portugal also referred to as Resident Permit Program is a scheme whereby non-EU nationals are given permanent residency in Portugal for 5 years. Eligible candidates, when they invest a certain amount in real estate. Are offered residency so they can live, work, study, and freely move across the EU.
The most affordable residency-by-investment program
The Golden Visa Program of Portugal is one of the most popular residency by investment schemes that offer an individual a chance to get EU nationality with a minimum amount of investment in the real estate of Portugal. Among all citizenship by investment programs, it is the golden visa program of Portugal that is most affordable. The following is a list of important benefits coming your way if you get selected under this visa program.
- You are allowed to live, work, study, and freely move across the EU
- No stringent requirements of stay in Portugal (enjoy permanent residency by staying for just 7 days in the first year and 14 days in the next two years)
- Enjoy abundant sunshine and the fantastic coastal life of Portugal.
- Portugal has the lowest cost of living with a well-developed infrastructure in place
- Your dependent kids and parents get a chance to live in Portugal
- No expiry of permanent residency. You can choose to extend it or apply for citizenship after 5 years.
- Real estate investments start from Euro 280,000 though easier options are Euro 350,000 and Euro 500,000.
- Investors are taxed on their yearly income only if they live for more than 183 days in Portugal. However, there is no need to worry as the Portuguese government does not charge income tax for the first 10 years from investors entering Portugal under this program.
Just imagine gaining residency in Portugal through an investment of Euro 500,000, a sum of money that you use for buying a house in London, Paris, or Milan.
How it all started
Portugal was reeling under the negative impact of the great recession of 2009 and its debt to GDP ratio had reached alarming levels. The government of Portugal decided to give permanent residency to foreigners in a bid to attract foreign investment in the country. The Golden Visa Program was launched in 2012. Since then, more than 6,500 people have benefitted and successfully entered Portugal as residents. There is a strong allure of getting a chance to live in a European country. More importantly, the program has fetched an investment of nearly 5 billion Euros for the local economy. There is a broad consensus among all political parties of Portugal that the Golden Visa Program has proved beneficial for the economy of the country and it should continue and even expand in the future.
If one looks at the distribution of ethnicities of foreigners applying for a visa under this program, he finds that the highest numbers of Chinese followed by Brazilians, South Africans, Turkish, and Russian citizens have utilized this residency by investment program.
Eligibility requirements for the Golden Visa program
Any individual who is not a Portuguese and an EU national can apply for permanent residency under the Golden Visa Program. The only requirement is an investment of a certain amount of money in the Portuguese real estate market. The applicant also needs to meet the requirement of a minimum stay in Portugal of 7 days in the first year and not less than 14 days in the subsequent two years. Also, the investment needs to be maintained for at least five years. Besides investment in real estate, the other two options for gaining permanent residency are capital transfer and business. You have to prove the following to obtain permanent residency under the Golden Visa Program.
- You legally own the money you are using to buy real estate in Portugal
- There is no criminal record against your name anywhere in the world
- You can sustain your family members while living in Portugal as a permanent resident
The process of application under Golden Visa program
You cannot apply for a permanent resident visa in Portugal by saying you will invest in real estate after getting this visa. You have to make a real estate investment before applying for a visa. The process of buying a property in Portugal normally takes several months. The process of visa application then takes another few months. It is therefore advisable to initiate the process of property purchase and simultaneously initiate the visa application.
Various fees you can expect to pay
Buying a property worth 500,000 Euros is enough to get you a permanent resident status in Portugal. However, certain fees make buying a visa more expensive than it looks. Besides a property tax which depends upon the location and the value of the property, you also need to pay a fee for every member of your family to become eligible for staying in Portugal. This fee is 5,173 Euros per member of the family. You have to pay 50% of this fee for the renewal of the visas of all family members after every two years. There is also a processing fee besides a renewal fee of 520 Euros for the main applicant and 80 Euros for each additional member of the family. Finally, you have to stay prepared to bear the fee of nearly 5000 Euros for hiring the services of a lawyer who safeguards your interests during the real estate transaction.
The Golden Visa Program is the most affordable, and also the most popular program for foreigners desirous of a chance to live and work in an EU country. You are free to earn income on your investment by renting it out. There is a wonderful scope of a high rental yield as Portugal happens to be one of the most popular destinations for tourists from around the world.