The vast majority of investors prefer to invest in a diversified and secure portfolio, so they choose to invest outside their home country to protect their assets, but Covid-19 pandemic had a huge impact on global financial activities causing some levels of uncertainty in investments abroad. However there are many options that investors can choose to diversify their investments and Portugal Golden Visa is one of them advantageously: it is both an investment in a safe EU country and a residence opportunity that leads to citizenship for investors and their families.
According to specialists, Portugal is the best place to invest and retire in. A recent report by the Portuguese Borders and Immigration Service (SEF) shows consistency in the residency by investment program in Portugal Golden Visa. Due to pandemic situation and mobility restrictions, investors preferred options that did not require physical presence. Thus, investment in capital funds increased, while real estate investments decreased a bit. This period proved that diversifying assets and making overseas investments are necessary for investors all around the world.
How Portugal Golden Visa hold up during Covid-19 pandemic?
Due to the global lockdown caused by Covid-19, most of the international businesses have slowed their activities down. Yet according to the reports by SEF, Portugal Golden Visa Program holds its ground.
From January to June 2020 SEF has reported that ARI application brought 700 applicants and € 383 003 719,56 in investments.
During March and April the investments made were € 56 079 300,73 by 108 applicants, while May and June brought 441 applicants and € 235 269 133,95.
The numbers are very impressive considering the global circumstances. While every sector is struggling, the residency by investment program in Portugal continues strong.
Is Investment Fund a new route for Portugal Golden Visa application?
Considering the global pandemic and the travel restrictions, the Portuguese Golden Visa program has shifted into alternative investments rather than real estate acquisition, which is the most popular option until beginning of 2020.
These alternative investments mandate less in-person meetings and are more affordable.
The venture capital / investment fund option is one that rises right now, minimum €350 000,00 is required and long term profits are attractive besides the golden visa itself.
Until May, the applications for this route has already doubled the number from 2019.
This investment route has great advantages compared to other investment routes – depending on the client’s investment appetite:
- The investment does not trigger any tax similar to the ones that the client needs to bear when acquiring a property, such as the transfer tax (on average 6%), stamp duty (0,8%) or even the annual municipal tax (between 0,3% and 0,5%);
- It is considerably lower compared to the level of investment required by other investment routes;
- The investment is made into a Portuguese fund that is heavily regulated by the Portuguese authorities – The Portuguese Securities Market Commission (CMVM), Bank of Portugal, the external Fund Manager and the Tax Authorities, besides being audited. This level of regulation will assure the investors that, at all times, the fund will comply not only with Portuguese legislation but also with the business plan approved by the unit-holders, and that the milestones and/or fund goals are achieved;
- It is the most tax-efficient investment, where several benefits are granted (for instance, in certain cases there is an exemption of withholding tax on the payment of the income generated by the fund to the unit holders), especially if the unit-holders are not tax residents in Portugal;
- Each fund has a dedicated 3rd party fund manager that, besides controlling the fund and reporting to the Portuguese authorities, will take care of the payments to the fund units and will assist them in case there is the need to sell the owned units;
- The potential gains generated by this investment are substantially higher than any other investment route.
For more information on how to invest and apply for a Golden Visa in Portugal, contact Planeur today. We can give you the information you need to make an informed decision, while guiding you through the entire process, connecting you with the right professionals, and helping you to deal with the relevant paperwork.