If you’re considering adding another passport to your collection, or just making your home in a different country for some or all of the year, chances are you have run into the so called “golden visa” option. 

Immigration by investment has been around for several years already, and it shows no sign of slowing down. In fact, for people who can afford it, it’s one of the top options for immigration. There are several ways you can make the necessary financial contribution to qualify for this golden visa program, and in this case, we’re going to look at golden visa fund route in Portugal.

What is Golden Visa?

A golden visa program is the slang term for immigration by investment. 

Many countries around the world have realized that there are high net worth individuals who might like to make a new home in their country. They allow those people to make a financial investment in one of a variety of ways, and in return, some of the criteria that normally apply to immigration are waived. 

It’s a good way for countries to attract foreign investment, and of course, having more high net worth people living in your country is good for the economy in other ways too. 

What are the benefits of Golden Visa?

When you choose to immigrate to another country, there are usually strict rules about who qualifies. 

Usually, those rules either relate to your skills and experience, or you need to have a job offer or be accepted to study in the country. 

When skills and experience are the criteria, usually immigration programs favour people who have high levels of skill in technical, academic or scientific fields, or who are well known culturally or in sports and related activities. 

Job offers to support immigration usually need to be in specific fields, which limits the people who qualify, and helps to prevent local job losses. 

Students who qualify for immigration are usually those who have completed advanced training in their new country, and there’s often a long process involved in going from student to permanent resident. 

Immigration by investment or “golden visa” programs remove some of those barriers. They don’t require you to have scarce skills or get a job, and you don’t have to qualify for advanced studies. While you still have to meet other immigration requirements like health checks and criminal record checks, many of the other requirements are waived or relaxed. 

Possible ways of investment

There are several ways that you could invest in a country in order to meet immigration by investment requirements, and they usually vary from country to country. However, most countries will have some of the following options:

• Investing in property that is valued at above a certain amount and keeping it for a prescribed period
• Investing in or starting a business that creates a certain number of jobs, is in a particular area or focused on a prescribed industry
• Investing in government bonds to a particular value and retaining them for a prescribed period
• Investing in approved investment funds

There are even some countries who allow you to make a smaller, non-refundable donation to the government in order to secure resident or citizenship status. However, you should always check the latest golden visa options for the country you are interested in, because these can change from time to time. 

Participation in investment funds or venture capital

While many people who chose to immigrate by golden visa used to choose property, more and more are opting for investment or venture capital funds instead. There are several types of investment and venture capital funds you could choose between, depending on where you plan to apply. 

Types of investment funds

When you are deciding whether to support your golden visa application by investing in a fund, there are several options you might be able to choose between, these include:

• Property development funds (also known as real estate funds)
• Higher risk mixed investment funds
• Venture capital funds 

Every country that does allow immigration by investment will have different kinds of funds that they approve, and sometimes, you can only choose one of the funds that are approved by the government. So, you should always review the information that is available on the government’s website when you decide to make the move. 

Main advantages of Golden Visa Fund Route

If you have the capital available to support your golden visa application by investing in a fund, there are several benefits that might apply to your choice. These include: 

Reduced minimum required investment amount

In some cases, you can invest less money in a fund than you would have to spend on property or starting a business in the country you are applying to. The costs related to the investment are also typically lower than what you would spend on purchasing a property or starting a business. 

Ease of investment implementation and management

In most cases, the funds that you can invest in are fully managed, so there’s very little work involved in investing and managing your investment. They are also usually diversified, so you don’t have to worry about balancing your investment yourself. 

Absence of overhead costs associated with the investment

Property and businesses have high overhead costs. You have to maintain the building, pay employees and take care of all kinds of other things that you might not even have considered when you made the investment. Investment funds usually have some kind of commission and fees, but they are predictable, and you will know exactly what they are before you invest. 

Return on investment and capital gains

When you invest in a fund, there’s a good chance that you will make a considerable return on that investment by the time you are able to cash it out. Depending on the risk versus reward structure of the fund, this could result in a considerable profit. 

No travel required! 

Buying property site unseen is never a good idea, which is why, during the pandemic, so many people have avoided this kind of golden visa. You can review an investment online – but it’s nearly impossible to buy property remotely! 

Tax benefits

Depending on the tax on capital gains in your new country, you might be able to benefit from lower capital gains tax on investment funds rather than property or other physical investments. 

No Property Purchase Restrictions

Some governments, like Portugal, have limited the places you can purchase property to support a golden visa program. An investment fund does not have those restrictions, and you can still purchase or rent a property in the areas you prefer when you arrive. 

Disadvantages of Golden Visa Fund Route

Of course, when something has advantages, there is always a downside too, and golden visas by investment funds are no different. Some of the disadvantages of  this kind of immigration by investment are:

• As with any investment, there is always some risk – it might be small, but it always exists
• There is no guarantee that you will get all your money back or make any money off your investment
• You won’t be able to access your investment until it matures, whereas you are free to sell property as soon as you meet the program requirements

FAQ

What kinds of golden visa funds can you invest in?

There are a variety of funds that you could choose to invest in. Some focus mainly on property, others on commodities, and some are venture capital funds that focus on start-ups. There are also some options that offer a mixture of investment types. 

How much do you need to invest?

That depends a lot on which country you want to move to. In Portugal, investment funds for golden visas require an investment of $500,000, but other countries have different thresholds. 

How long do you need to invest for?

That, again, depends on the country, but most will require you to invest for at least a few years, or until you are eligible to apply for citizenship. As always, you need to review each country’s individual requirements. 

Does a golden visa make it easier to get residency?

Yes and no. A golden visa removes the  need to have a job lined up, have the right academic and work experience, or be accepted to study in the country, but you still need to meet other criteria. You will still need to meet medical, criminal and security requirements, and you will still need to be able to provide proof of funds to support your living expenses – so be sure to factor that in! 

How long does a golden visa application take?

Immigration is never a fast process, and while immigration by investment or golden visa programs can definitely smooth the process, you can still expect anything from a few months upwards. 

Contact Us

Whether you are interested in applying for a golden visa by buying property or investing in a fund, we can help. Smart Citizenship has been helping people to successfully navigate the golden visa process for several years, and we’re always happy to offer advice and answer questions.