Portugal’s ‘golden visa’ program was launched in 2012, and this scheme gives opportunity to non-EU/EEA investors first to obtain a special, followed by the permanent residence permit, in exchange of investment and second – to apply for Portuguese and, therefore, European citizenship.
The Portuguese ‘ARI’ (Autorização de Residência para Actividade de Investimento) scheme, or as generally called the ‘Golden Visa’ program, is one of the best residency-by-investment (RBI) programs for high-net-worth individuals globally. The program was launched back in 2012 to boost foreign direct investments and, so far, has spurred almost 5.8 billion Euros in Portugal’s economy.
In total, more than 9,800 residency permits have been issued for main applicants, along with around 16,700 for their family members.
After five years of holding Portugal’s ‘golden visa,’ investors are eligible to apply for permanent residency and after maintaining this status for one year, they become eligible to apply for citizenship. Hence, the first beneficiaries of the scheme can apply for citizenship, but they need to comply with certain criteria, including language tests and actual spending days in Portugal.
Just to maintain a residence permit, ‘golden visa’ holders have to spend seven days in the first year and 14 days in the subsequent years in the country.
There are multiple options with different investment thresholds for investors to apply for Portuguese residency, but the most popular option is through realty acquisition. Notably, by the end of 2021, the major cities of Porto and Lisbon, along with almost all coastlines, will be exempted to qualify for the program. Hence, investors should use the window of opportunity to buy profitable real estate.
Real Estate Option assumes that a qualifying foreigner investing at least 500,000 Euro in realty is immediately eligible for a residency card. It is not necessary for the real estate investment to be in one unit, can include several properties, and co-ownership. The investment threshold is significantly reduced to € 350,000 if the property is more than thirty years old. The Investment should be maintained for at least five years.
Investors can also choose the Capital Investment option to qualify for the Portuguese ‘golden visa’. This investment category has its subcategories with different thresholds: for the capital transfer into a Portuguese bank account, the minimum required amount equals to 1 million Euros. Whilst, if the investor decides to fund a scientific research activity, the minimum required amount is €350,000. The threshold gets even lower to €250,000 if the investor will support artistic production or recovery/preservation of national cultural heritage.
For the realty and capital transfer options, there will be 20 percent discount if an investment is made in a low population density area (less than 100 inhabitants per sq. km. or with a GDP per capita below 75 percent of the national average).
Investors can also opt for Business Investment, and thresholds start from 350,000 Euro. Investors are entitled to apply for a residence permit if they create at least 10 jobs and reserved them for at least of 3 years.
The Portuguese government is also encouraging ‘green’ environmental projects, which can range from non-intensive organic agriculture and ecotourism projects to renewable energies and other environmental initiatives, including organic farming and carbon-neutral projects. Anyone funding such activities with at least 500,000 Euros is also eligible to apply for the Portuguese residence permit via the so-called ‘Green Visa’ category.
According to Andre Silva, the leader of the Portuguese People – Animals – Nature political party and a member of parliament, “the Green Visa will serve to reinforce Portugal’s role in attracting international ecological investment, while simultaneously ensuring the transition to a circular and carbon-free economy.” It was him who has initiated this initiative.
In practice, more than 94 percent of ‘golden visa’ applicants choose the real estate option, as investing in realty is beneficial, simple, and very easy to resell or rent out. Investors in realty can gain up to 10-12 percent of the total investment annually by placing their properties on the short rental market. As the country is one of the favorite destinations for tourists, the demand for rent will be preserved. The rest 6 percent, comes for a capital investment option.
Portuguese ‘Golden Visa’ Gives Many Perks to Its Holder, Which Include:
- The right of permanent free entry and movement through 26 European states, which are members of the Schengen zone;
- Dependent children and parents of the investor can also apply for the residency;
- Investors are securing a second residence, leading to a second passport after six years, in a safe, stable, and a developed country;
- Unlike other ‘golden visa’ schemes, the Portuguese program is not blacklisted by the Organization for Economic Co-operation and Development (OECD);
- Investors can become non-habitual residents of Portugal and pay little or no tax for 10 years;
- There is no tax on foreign income for non-domiciled persons;
- After six years of ‘golden visa,’ holders can apply to obtain the Portuguese passport, which is one of the strongest passports in the world, allowing its holder to travel visa-free to 182 countries.
- Portuguese residents enjoy an excellent and affordable quality of life, developed healthcare and education systems, along the best climate in the Atlantic coastal state.
The number of ‘golden visas’ issued drastically dropped last year due to the Covid-19 pandemic and global lockdowns. But experts think that the program will regain previous levels as the pandemic is over.
Experts argue that the volatility in demand is caused by the reasons of a seasonal character or political turmoil and unpredictability, along with increasing competition on the RBI industry market. Although, against all odds, Portugal’s ‘golden visa’ scheme is one of the leaders in the investment migration market.