We give some very important tips before investing a golden visa programs for prospective buyers. The Global Covid-19 pandemic and other world events have practically rebooted the real estate market worldwide which is attached to golden visa schemes. It is likely prices will fall within few months, a great news for golden visa buyers.
Take these following tips before investing in golden visa schemes.
1. First decide which country
There are so many golden visa programs out there from Europe to America and each one is different. You have to carefully decide which country is good for you. This will take a lot of time and you have to do your research properly.
Think about warm climate not too cold, lots of sun and location not far from where you live and should be easy to travel. You should not forget cold winters with long periods of darkness with clock resets for daylight savings is quite depressing in Northern europe.
A country that has english as official language is quite convenient too, this way you dont need to struggle with language problems.
2. Real Estate
Portugal and Greece are exciting golden visa schemes when it comes to real estate. You can invest in commercial and residential properties. Here are the tips you should follow.
Do your research on these (agents wont disclose everything)
- Rental yields
- Per square meter prices
- VAT on the property (Greece exempts VAT for Golden visa buyers)
- Legal costs, insurance, property registration taxes, any other additional costs
- Government fees charged for Golden visa applications. (cheaper the better)
- Holding period before selling
- Reputation of the developer
- Dont buy in restricted areas.
- Property management costs
3. What type of residency?
You have to check whether the golden visa programs offers just residency or permanent residency (PR). This is very important as longer the time saves you from hassles of running around., usually PR cards are issued for 5 years with renewals. Residence cards are issued for maximum one or two years.
4. Active vs Passive Investment
Passive investments are usually sleeping investments such as real estate, government bonds is quite convenient for many golden visa investors. You can just invest and relax and dont need to do anything.
Active investments on the other hand require you to create jobs risking your capital, write a business plan which is simply not possible without experience. You will struggle if you are not into business. For example Germany, Netherlands or US will give you residence visas if you invest in a business and create jobs, else you are wasting your time.
5. Are you required to live or visit?
There is a difference between visiting and living. While most european golden visa schemes in Greece, Portugal and Ireland require you to visit for few days dont require you to live at all.
For example, with US, UK schemes, you are required to immigrate and live in this country making it a permanent home. For many investors, visiting for few days is okay, but living is just not attractive leaving their business or family behind.
6. Possibility of Citizenship
You must also research the possibility of citizenship for you, family members and particularly children. It is very important you give children a great opportunity to become citizenship considering their future. We tell clients Citizenship is the ultimate investment for family.
Citizenship is impossible in some countries without you actually living for atleast 5 years through naturalisation and passing language tests. But some countries like Portugal are quite lax does not require you to actually live still you can get EU citizenship.
7. Free movement in Schengen Area
Visa free movement is an absolute must and impossible to ignore to do business, visit friends or even for tourism.
You have to watch out that investing in Ireland, UK, Bulgaria, Cyprus will not give you free movement in schengen, as these countries are not part of schengen area. With UK brexiting out, and most world countries in chaos in the aftermath of Covid-19, Europe is likely to emerge as the next super power. Think about it!
8. Education and Healthcare
For centuries USA, UK, Ireland, Australia have some of the best education systems in the world, but the costs for education is quite expensive. Europe is much cheaper for children and schools offer free education.
No doubt that European countries have the best award winning healthcare systems in the world.
We advise our clients to plan ahead on international tax planning BEFORE applying for golden visa. You have to make use of effective tax strategies that will avoid your worldwide income and effective use of double taxation treaties.
Malta, Portugal, and Italy offer a flat tax rate for HNW clients under non-habitual tax regime. UAE and Caribbean have no income taxes
In todays world it is simply impossible to ignore taxes as banks collect tax numbers and share it with OECD CRS countries and an exchange takes place with tax authorities (160 countries are members). US does not participate in OECD sharing, itself a tax haven
Tax matters are quite complicated you should discuss it with the tax advisor.
10. Passport power
Have you thought about being a proud holder of of the the most powerful passports in the world?
European passports are the leaders when it comes to passport power. A decade ago US and UK passports used to be the best passports in the world. Not anymore, In 2020, the power of these passports have fallen off a cliff.
Still Portugal, Greece, Spain, Malta have the strongest EU passports in the world and it is very much possible to acquire these passports through golden program.
Take a look at best passport rankings 2020.