A Golden Visa for Portugal can give you broad access to Europe. Should you apply for it?

Although this may sound appealing, the program has undergone quite a few changes recently.Mint Provides an overview of the pros and cons of Portugal’s Golden Visa program.

The application process

Until recently, real estate investment was a popular option for people seeking a Portugal Golden Visa. However, as of October 2023, real estate investments are no longer eligible for the program. As a result, the funds option, which was available even before, is gaining much more ground.

In order to obtain residency in Portugal through this programme, individuals must invest in funds specifically earmarked for local Portuguese companies in need of operating capital. At least 60% of the capital of such funds must be invested in Portuguese companies.

“Golden Visa-eligible funds often focus on high-impact sectors such as artificial intelligence, life sciences, technology and sustainable projects,” said Sandeep Jain, co-founder and COO of Multipolitan, a global migration platform.

Obtaining a Golden Visa or temporary residence usually takes between 1.5 and 2 years from the time of investment. While waiting for your temporary residence, you will need to visit the Portuguese immigration agency (Agency for Immigration, Migration and Asylum) to register your biometric data.

After temporary residency, it takes another five years to obtain permanent residency. In January, the Portuguese government passed a law so that the five-year period is counted from the date of application and not from the granting of temporary residency or the Golden Visa.

This should reduce the waiting time to three years from receipt of the Golden Visa. It could also reduce the number of mandatory visits to Portugal.

However, until recently, Portugal’s Golden Visa program required a person to stay in Portugal for seven days a year or 14 days in a two-year block, over a five-year period.

Rights and obligations

As soon as you obtain the Golden Visa temporary residence, you will have the right to live and work in Portugal, as well as to travel visa-free in the Schengen Area, which includes 29 European countries.

Unless you stay in Portugal for more than 183 days, the country does not tax the global income of Golden Visa holders.

After obtaining your permanent residency, you have two options: continue with permanent residency or apply for Portuguese citizenship.

With a PR, you have the same rights, but there is no longer an obligation to comply with a minimum stay requirement. You can also recover your investment in funds.

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If you decide to apply for Portuguese citizenship, you will have to wait another five years after obtaining permanent residency. As a holder of a Portuguese passport, you will have broader access to other countries, as there are as many as 188 countries that allow visa-free access or visa on arrival.

In addition, you can live and work in any of the 29 countries of the European Union.

The costs involved

As we have already said, you will need to invest a minimum of €500,000 in a suitable fund. In addition, you need to take into account another €60,000 ( ₹55 lakh) towards legal expenses and filing fees.

Alternatively, you can apply for the Golden Visa program through a donation of €250,000 ( ₹2.3 million rupees) or €200,000 ( ₹1.8 crore), depending on the specific location of the donation.

“However, the donation route is not that popular because unlike investment funds, there is no chance of getting the funds back,” said Arindam Sengupta, co-founder of education-focused fintech startup Myglobalcitizenship.

Please note that Tax Collected at Source (TCS) of 20% is applicable on all foreign transactions. However, this can be claimed later when filing returns.

Benefits of the Golden Visa of Portugal

The benefits of the Golden Visa extend to your spouse, children under 21 years of age at the time of application, and parents who are financially dependent on you and have health problems. If your adult children are financially dependent on you and are over 21 but under 26, they will also be eligible as long as they are full-time students and single.

According to Vishal Dhawan, Founder of Plan Ahead Wealth Advisors, clients seeking a Portugal Golden Visa program are usually looking for overseas education or better career opportunities, or as a retirement option.

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“There are more career opportunities in Western countries than here in India. If someone wants to pursue a career in sports management, there are more opportunities abroad,” said Rajneesh Pathak, founder and CEO of GlobalNorth Residency and Citizenship, a Mumbai-based company specialising in immigration by investment.

For business owners with international operations that require frequent travel across Europe, unrestricted access to different countries can be helpful.

Choosing a fund

There is no official government platform that lists all the funds an applicant might consider, even though these funds are largely regulated by Portugal’s securities regulator. Accordingly, investors in India must first contact a broker who will put them in touch with a Portuguese lawyer. The lawyer will provide them with a list of suitable investment funds.

However, be careful when selecting an agent, as it involves substantial costs. Leverage your network to find references from people who have already obtained the Golden Visa.

Also, instead of individual agents, choose established companies that can demonstrate a track record and have partnerships with reputable law firms that specialize in Golden Visa applications.

You can also check the fund websites for information such as audit report and track record. Also check if the funds offer any tax benefits on income distribution or capital gains. These funds typically return 3-5% annually.

Should I opt for a Portugal Golden Visa?

According to data from Dixcart, which is among the law firms offering Golden Visa support, 1,234 Indians had applied for the Golden Visa till October 2023, accounting for 5% of the total Golden Visa applications from Portugal.

If you are considering the Golden Visa program for any of the reasons mentioned above, be sure to work with a reputable organization and do your own research. Remember that you must make a significant investment in Portugal for 5 to 7 years to obtain permanent residency in that country.