Major changes in Portugal’s Golden Visa Programme lie just ahead

But for many South Africans it remains the preferred route for a plan B or an exit from SA.
Image: Shutterstock

Portugal’s Golden Visa Programme remains one of the most popular plan B’s or exit routers for South Africans planning to emigrate.

This is despite changes to the programme that will direct investors away from more popular areas such as greater Lisbon, Porto, and most coastal areas.

“The good news is that we have secured residential investment opportunities at starting prices as low as €280 000 [around R4.9 million], and we have also been able to secure great investments in prime areas like Lisbon and Porto,” says Andrew Rissik, director at Sable International.

“This means South Africans can still take advantage of the visa programme and enjoy pretty much the same benefits as before.”

Other changes are scheduled to come into effect on January 1, 2022, affecting the €350 000 and €500 000 property investment routes. The €350 000 Private Equity Fund (PEF) investment threshold will be raised to €500 000.

“Despite these changes, we’ve been able to secure properties that make it extremely affordable for South Africans to plan their exit and apply for the Portuguese Golden Visa,” says Rissik.

Rissik says the looming changes will not affect residency card holders or applicants already on the programme who renew their residence permit cards or join family members in the programme.

“Although the deadline is looming, there is a small window of opportunity for those who still want to secure property investment in the most sought-after areas such as Lisbon and Porto.”

Why is the Golden Visa so popular?

The Portuguese Golden Visa programme is a residency-by-investment scheme designed to encourage investment into the country by non-EU citizens.

Traditionally, the programme’s real estate option is a popular way to get residency in Portugal, especially for South Africans. This is because the country is regarded as a prime destination among property investors, with a flourishing real estate market. The route also allows investors to sell a property after a period of time and recover their investment.

Sable International has already assisted dozens of families to take advantage of the programme.

Since launching in 2012, Portugal’s Golden Visa programme has been one of the world’s most successful residency-by-investment initiatives, largely due to the minimal residence requirements (only 35 days over five years) and flexible path to citizenship.

The main benefits of the Golden Visa programme include:

  • The right to enter and stay in Portugal with no additional travel visa;
  • The right to live and work in Portugal;
  • The freedom to travel across the Schengen Area without an additional travel visa;
  • The right to benefit from family reunification and add family members to the Golden Visa programme; and
  • The right to apply for permanent residence or citizenship after five years.

As at June 2021, 9 834 Golden Visas had been approved through the property route. However, the majority of these were for the urban and coastal areas. Only 761 were in ‘urban regeneration’ classified areas.

Why choose Portugal?

Many people from across the world are settling in Portugal. The most sought-after lifestyle and business locations include Cascais, Lisbon, Oporto, and Algarve.

Security: Portugal was recently ranked as the third safest country in the world to live in, according to the Global Peace Index. This will no doubt speak to many South Africans concerned about the high level of crime in their home country.

Visa-free travel in and around Europe is a prime reason for obtaining Golden Visa. If you have ambitions of working within the EU, this is really beneficial. If you are a Portuguese citizen, you also gain the right to live and work throughout the EU area.

Favoured retirement destination: Portugal is a prime destination for foreign retirees and, according to the Global retirement Index 2020, is on the top 10 list of best countries to retire to. Tax residents enrolled in the country’s Non-Habitual Residency (NHR) programme can benefit from a tax rate of only 10% on foreign pension income and exemption from almost all foreign-sourced income tax.

Favourable tax regime: Portugal has one of the most favourable tax regimes in the EU, whether you’re a resident or citizen. There’s also no tax on inheritance or gifts from close relatives.

The changes will not work retroactively

The Portuguese constitution prevents any judicial updates from working retroactively. Therefore, applicants who have started their application will not be affected.

Understandably, the change to the programme has triggered a rush of property buyers and Private Equity Fund (PEF) investors wanting to qualify for the residency scheme, with inquiries for residency via property investment and demand for Private Equity Funds up by at least 20%. Through Sable International’s experienced on-the-ground support staff and property specialists, it is still able to present great investment opportunities and assist clients with their property or PEF investment remotely.

“It is important to note that not all properties or PEFs will qualify an investor for the Golden Visa Programme, so prospective investors need to beware of unscrupulous agents and developers who themselves don’t always understand the qualifying requirements,” says Rissik.

About Sable International

Sable International is an expert in helping small- to medium-sized businesses, private individuals and clients with international interests, offering full-service solutions through its citizenship, residency, wealth, tax and forex divisions. It specialises in cross-border financial and immigration advice and solutions.

Brought to you by Sable International.

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