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Cristiano Ronaldo. Great wine. Some of the world’s most stunning beaches. And home to the Portuguese Golden Visa.
Yes, we are talking about Portugal! Europe’s most westerly country has leapt into the spotlight in recent years and has become an attractive destination for foreign citizens and ex-pats. But why?
Beyond the surf, sun, and food (plus wine), it’s a country that is always at the top of the rankings when it comes to safety! It’s the fourth most peaceful country in the world, according to the Global Peace Index.
This balance of the good life and world-beating security has made Portugal famous worldwide for its attractive Golden Visa program. It was launched by the Portuguese authorities in 2012 to encourage foreign investment in the country and improve the Portuguese economy.
The numbers don’t lie. Since the program’s launch, Portugal has welcomed more than 10,600 investors and 17,600 family members from all over the world. Many of these hail from North America, Brazil and China.
What is the Golden Visa program?
The Portuguese Golden Visa is a five-year residence program for non-EU nationals. It offers benefits for the investors and their family members, such as visa-free travel in Europe’s Schengen Area.
However, the main benefit compared with other visas is that the Golden Visa requires the holder to stay in Portugal for just seven days a year. Other residence permits require stays of at least 182 days per year.
How can I get a Golden Visa?
There are several investment options. Real estate and investment funds are the most popular and account for more than 90% of the total.
This year, however, the law changed. Now, real estate investments can only be considered when purchased outside of major cities. The authorities are doing this to stimulate development and economic growth in rural and countryside areas. The great thing for wannabe second passport holders, this is where many of the best opportunities are still hiding.
Nevertheless, the main objective of most investors is to secure a Portuguese Golden Visa and then a passport. And this is possible after maintaining the investment for five years.
Why is the Portuguese Passport so attractive to non-EU citizens?
The Portuguese Passport is first-class. It grants visa-free access to 185 countries and the ability to live, work and travel freely in all 27-member states of the European Union.
Getting Portuguese citizenship offers the chance to participate in:
- full employment
- education and health national systems
- access social security benefits
- vote in Portuguese elections
Portugal has a high quality of life and ranks above average in factors such as housing, and environmental quality. Life expectancy at birth is 81.5 years, which is higher than the European average. Moreover, the country has incredible infrastructure and a stable political environment.
The flexibility that Portugal offers its citizens with regards to residency is unique across Europe. Portuguese citizens have minimum requirements to stay in the country to maintain their residency. This means that citizenship is kept while residing in another country in the world.
Another thing that makes the Portuguese passport so appealing is that Portugal allows dual citizenship, making it the perfect choice for ex-pat families.
What about taxes with a Portuguese Golden Visa?
Last but not least, taxes! A person becomes a Portuguese tax resident when their stay is more than 183 days in a year or they have become a permanent resident in Portugal.
That being said, Portugal offers attractive tax benefits through its Non-Habitual Residence program (NHR). After registering as a tax resident, you can apply for the NHR Regime, which reduces the tax burden on your income through exemptions.
NHR status allows for tax exemptions from various tax categories of foreign-sourced income. These include:
- pensions
- capital gains
- employment tax
There is also a 20% flat tax rate for certain Portuguese-sourced income instead of the standard rates that progressively rise up to 48%.
What do I need to do?
At Lexidy LegalTech Boutique, we have helped many investors over the years to find the right visa for them. Feel free to reach out to us and schedule a call so we can understand together if the Golden Visa is the best option for you. You can now start thinking about what your life in sunny Portugal will look like.