A Portugal Golden Visa can give you wide access to Europe. Should you apply?

Even if that appears appealing, the programme has undergone quite a few changes recently.Mint gives a lowdown on the pros and cons of the Portugal Golden Visa programme.

The application process

Until recently, real estate investment was a popular route for individuals seeking a Portugal Golden Visa. However, from October 2023, real estate investments are no longer eligible for the programme. As a result, the fund route, which was available even earlier, is gaining a lot more traction.

For residency eligibility in Portugal via this programme, individuals need to invest in funds that specifically target local Portuguese businesses needing operating capital. At least 60% of the corpus of such funds needs to be invested in Portuguese companies.

“The 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 chief operations officer of Multipolitan, a global migration platform.

A Golden Visa or temporary residency typically takes 1.5-2 years following the investment. While awaiting your temporary residency, you will need to visit the Portuguese immigration agency (Agency for Immigration, Migration and Asylum) to register your biometrics.

Following a temporary residency, it takes another 5 years for the permanent residency to come through. In January, the Portugal government passed a law for the 5-year timeframe to be considered from the date of application and not from when a temporary residency or Golden Visa is awarded.

This should bring down the wait-time to 3 years from receiving the Golden Visa. It could also reduce the number of required visits to Portugal.

However, until recently, the Portugal Golden Visa programme required an individual to stay in Portugal for either seven days annually or 14 days in a block of two years, over a five-year period.

Rights and obligations

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

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

After getting your permanent residency, you have two options—continue with the permanent residency or apply for Portugal citizenship.

With a PR, you have the same rights, but there is no longer any obligation for a minimum stay requirement. You can also redeem your fund investment.

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You can get citizenship in Portugalafter five years of legal residency. As a Portugal passport holder, you get wider access to other countries, with as many as 188 countries allowing visa-free access or visa-on-arrival.

Also, you can live and work across any of the 29 European Union countries.

The costs involved

As mentioned earlier, you will have to invest a minimum €500,000 in a suitable fund. Apart from that, factor in an additional €60,000 ( ₹55 lakh) towards lawyer charges and filing fees.

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

“However, the donation route isn’t as popular because, unlike fund investments, there’s no possibility of recouping your funds,” said Arindam Sengupta, co-founder of education-focussed fintech startup Myglobalcitizenship.

Note, tax collected at source (TCS) of 20% is applicable on any overseas transactions. However, this can be claimed later when filing returns.

Benefits of a Portugal Golden Visa

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

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

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“Certain career opportunities are more developed in western countries than here in India. If someone wants to build their career in sports management, there are more opportunities overseas,” said Rajneesh Pathak, founder and chief executive officer of GlobalNorth Residency and Citizenship, a Mumbai-based firm specializing in immigration by investment.

For business owners with international operations who require frequent travel across Europe, an unfettered access across different countries can be helpful.

Choosing a fund

There’s no official government platform listing all funds that an applicant could consider, even though these funds are largely regulated by Portugal’s securities regulator. Consequently, investors in India must first contact an agent who will connect them with a Portuguese lawyer. The lawyer will then provide a list of suitable investment funds.

However, exercise caution when selecting an agent as substantial costs are involved. Leverage your network to seek references from those who have already obtained the Golden Visa.

Additionally, instead of individual agents, choose established companies that can showcase a track-record and have partnerships with reputable law firms specialising in Golden Visa applications.

You can also check for funds’ websites for disclosures such as audit report and track-record. Also check whether the funds come with any tax benefit for the income distribution or the capital gains. These funds typically yield 3-5% per annum.

Should you 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 Golden Visa as of October 2023, which was 5% of the total Portugal Golden Visa applications.

If you’re considering the Golden Visa programme for any of the above reasons, make sure you work with a reputable organisation and do your own due diligence. Remember, a significant investment must be committed to Portugal for 5-7 years to secure a permanent residency in Portugal.