Launched in 2012, the Golden Visa is one of Portugal’s most well-known and popular visas. It essentially offers residency, or the right to live in Portugal, to non-EU citizens in return for making an investment in Portugal.
While that investment can be in a business that creates jobs, it can be as simple as purchasing property in Portugal that’s worth €500,000 or more (or €350k or even €280k in some cases).
And, who doesn’t want a property in Portugal?
After 5 years of being resident in Portugal, you can not only apply for permanent residency but Portuguese citizenship as well. Once you have citizenship, you can apply for a Portuguese passport.
Not only does a Portuguese passport give you a lot of travel benefits, but it also gives you the right to live, work, study and travel in all of the other EU countries.
This concept isn’t unique and many European countries like Spain and Malta offer some form of Golden Visa or residency in return for investment schemes. But, although other countries offer similar programs, Portugal’s scheme has become very popular for a number of reasons which are outlined below.
The scheme is especially popular with investors from China, Brazil, Russia, and South Africa, but is expected to grow more popular with citizens of the United States and the United Kingdom in the coming years.
It’s always a good idea to compare Portugal’s Golden Visa scheme to those in other countries, and also to compare this visa to the other available visas, but there are a few very obvious benefits of this particular visa.
Although all European Golden Visa programs offer a path to citizenship, Portugal’s program is particularly appealing because:
- Citizenship application possible after just 5 years.
- The language requirement is only the A2-level of Portuguese.
- Portugal recognises dual citizenship.
Compare that to Greece for citizenship is possible after 7 years or Spain where citizenship is only possible after 10 years. Spain also only accepts dual citizenship in some cases whereas Portugal accepts dual citizenship.
Note: Some countries, like China, don’t recognise dual citizenship and so you can decide in year 5 not to apply for Portuguese citizenship but simply to just have permanent residency in Portugal instead. You won’t have a Portuguese (or EU) passport but you will still be able to live in Portugal and travel freely within the Schengen Area.
You won’t, however, have the same ability to live, work, and study in another EU country as you would if you applied for the Portuguese passport.
Low Residency Requirements
Another benefit is the residency requirements: the Portuguese Golden Visa scheme only requires you to spend an average of 7 days per year in Portugal (14 days every 2 years in practice).
Low residency requirements are common across most Golden Visa Programs, so this doesn’t necessarily make the Portuguese Golden Visa any better than the others, but it does make the Portuguese Golden Visa better than other Portuguese visas like the D7 or D2 (these are discussed later).
Because most visas (that aren’t Golden Visas) require you to spend an average of 183 days in a country to maintain residency. In Portugal, this is normally 6 consecutive months with no gaps or 8 months with gaps per year.
Only having to spend an average of 7 days per year is perfect if:
- You don’t actually want to live in Portugal.
- You have commitments elsewhere.
- You want to spend the majority of your time travelling.
- You want to maintain your tax residency somewhere else.
Maintain tax residency somewhere else
Only spending 7 days per year in Portugal allows you to be resident here but to maintain a tax residency somewhere else.
This will be of interest to entrepreneurs, digital nomads, company owners, and even high-earning employees who want to avoid Portugal’s high taxes.
Non Habitual Tax Residency is an option
Of course, you can be tax resident in Portugal as well.
Normally, Portugal’s taxes are not an appealing prospect, however, Golden Visa investors normally qualify for Portugal’s Non Habitual Residency (NHR) 10-year program as well.
This tax regime is often erroneously marketed as an opportunity to pay 0% tax in Portugal, the reality is that most people will either pay no tax on Portuguese income but be taxed elsewhere on their income or pay a flat rate of 20% tax on all your income. This is just an overview.
Pensioners, on the other hand, normally pay 10% tax on their pensions through the NHR scheme.
While this isn’t as attractive as the tax haven Portugal is often described as, this may be a better rate than what you’re currently paying.
Speak to an accountant or tax advisor for professional advice.
Investing in property is an option
While many European countries offer some kind of Golden Visa, not all allow you to invest in property. Some require you to form a company, invest in businesses, invest in government bonds or funds, or invest in startups.
Many people see property as much more attractive as it’s viewed as less risky than say investing in a business or startup, whether that’s buying it for yourself or as a rental investment. That’s not to say that property values can’t go down, of course, or that the rental market can’t change.
Another benefit is that investing in property gives you something tangible you can use and potentially enjoy unlike investing in a company or government bonds.
Family members are welcome too
As well as the main applicant, the following family members are also eligible for residency (there is a fee for each member).
- Spouse (or common law partner).
- Dependent minor children.
- Dependent minor adopted children.
- Dependent children aged 18+ if studying or financially dependent on parents.
- Parents over the age of 65 (or younger if dependent).
- Dependent siblings under the golden visa holder’s guardianship.
- Other relatives if certain dependency requirements can be proven.
During the renewals that take place during those 5 years, your children should meet the same requirements (namely that they’re under 25). This means that any children under the age of 21 at the time the visa is initially granted won’t have any issue, but older children will eventually need to move onto a different visa.
One of the benefits of the Golden Visa over other visas is that the main applicant only needs to be in Portugal for 14 days every 2 years, but his family members can spend as much time in Portugal as they want. This is ideal if the main applicant is still working outside of Portugal, but the other family members want to live or study in Portugal.
Of course, everyone in the application is allowed to spend as much time in Portugal as they like.
And, of course…
As with Golden Visa programs in most other European countries, Portugal’s scheme:
- Gives you the freedom to travel within the Schengen Area (and to enter and leave the Schengen Area without needing to get a Schengen Visa each time).
- Allows residency for multiple family members across several generations.
- Gives you access to Portuguese healthcare, education, and the right to work in Portugal.
- After citizenship, gives you and your children the ability to study at other European universities at significantly lower costs than as foreign students.
- Has no language requirements (although you will have to pass the A2 if you apply for citizenship after 5 years).
- Is considered to be one of the safest countries in the world.
- Has some of the best weather in the world (more than 300 days of sunshine in the Algarve).
- Is considered to be very tolerant of people moving here.
Note: The freedom is to travel within the borderless Schengen Area does not include the freedom to move to another EU country. Most EU countries allow you to stay for several months as a tourist, which is enough for most people, but, if you want to move to one of those countries, you would need a visa from that country.
This visa only gives you the right to live in Portugal.
The main requirement is that you make a suitable investment and hold it for a period of five years. However, there are one or two other requirements that you need to be aware of.
- You will need a clean criminal record.
- Be from outside the EU, EEA, or Switzerland (this is not an option for Germans or French, for example).
The application process also requires a number of documents, some of which will need to be translated. Biometrics (fingerprints) are also required.
You will also need to renew your residency.
The residency permit is normally granted for 1 year, 2 years, and 2 years (since 2020 this is now 2,2,2) and so renewal is necessary every 2 years. Once you get to the 5 year point, you qualify for permanent residency (renewable every 10 years).
A few more considerations…
There are a few things that you should consider before going down the Golden Visa route.
Is there another visa that’s for you?
The Golden Visa has a lot of advantages over other Portuguese visas, as well as Golden Visas from other countries, but if your goal is to live in Portugal for the majority of the year (6 months or more), and you have a passive income such as a pension or even a salary from a remote job, the D7 is much cheaper.
Anecdotally, and ironically given the cost of the Golden Visa, the D7 also seems to get processed faster than the Golden Visa.
Of course, it does mean spending 6+ months in Portugal which may not suit everyone.
If your goal is to start a business in Portugal, on the other hand, you may find the D2 visa a better option. Not only is the minimum investment criteria very low (around €5k), but there’s no job creation requirement.
However, if you want Portuguese residency and later citizenship, and want to spend as little time in Portugal as possible, the Golden Visa is the right choice for you.
Expert help is recommended
While this program has a lot of benefits and is highly recommended, expert help is always recommended when investing in a foreign country.
In terms of property specifically, you will come across…
- Properties that aren’t completely legal.
- Properties that have illegal swimming pools or other features.
- Properties where the owner wants to be paid in cash to dodge taxes.
- Properties with all sorts of undeclared issues.
- Properties where the owners don’t have the right to sell.
- Properties where the owners don’t really want to sell.
- Properties that are more expensive than they should be.
- Properties where the price has been raised to meet the Golden Visa requirements.
Or at least, hopefully you will spot these things. Some first time buyers don’t know to look out for these things and end up getting stung. (It should be said that Portugal isn’t the only Southern European country with cowboy estate agents. But, it is one of them.)
Because of all of this, it’s highly recommended that you get independent help. At the very least this means having a lawyer (that’s not connected with your estate agent or the seller) go through the contract before you sign anything.
There are also a small number of buyer’s agents in Portugal who will hold your hand through the entire process. These are real estate professionals who will help you find a property that’s right for you and, because of their experience in the field, they can often cut out a lot of work by spotting properties that are likely to have problems. Most split the commissions with the seller, so are able to help you without adding any additional costs to your budget.
Note: the term “buyer’s agent” or “buying agent” is more of a marketing concept (at least in Portugal) than a legal term and so, as more and more estate agents find out about the idea, more and more estate agents are advertising this service. There are plenty of good guys out there, though, and when you do find one, they can be worth their weight in gold.
A look at the different investment routes
There are a number of different ways that you can invest in Portugal, from property to venture capital funds, but remember: once you’ve made your investment and obtained the Golden Visa, you can’t switch investment routes without having to start the process again.
So, pick something that you’ll be happy with for at least five years.
Some possible routes include:
- Property – Usually valued at €500k, but in some cases it can be €350k or even €280k.
- Cultural Investment – An investment in the arts, culture, or national heritage of at least €250k.
- Funds Investment – An investment in qualifying private equity or venture capital funds equalling at least €350k.
- Scientific Research – Investment in public or private scientific research amounting to at least €350k.
- Capital transfer – Transfer of €1,000,000 to a Portuguese bank account.
Property purchase (most popular option)
Cost: €500,000 (although €350,000 or €280,000 options available)
The most popular investment option is the purchase of a property (or properties) equalling €500k or more in value. In some cases the amount can be lowered to €350,000 or even €280,000. Properties can be residential or commercial and off-plan properties are allowed as well.
The reason for its popularity is that it’s seen as less risky than other investments and it gives you something tangible. For many people also, €500k is a big investment and they may need this property for their main home.
If you decide not to use the property as a second home, you also have the value of renting it out either to long term renters or to Portugal’s booming tourism market. There are a number of property management companies in Portugal that can handle the property rental on your behalf.
One of the downsides to using property as your investment for the Golden Visa is that it can take longer than the other routes simply because finding the right property can sometimes take some time.
There are cheaper options
While €500k is the standard property investment amount, it is possible to buy cheaper properties in certain conditions. There are a lot of properties in need of renovation that qualify for the €350k option.
Renovating a property can be a more affordable option than purchasing a property for half a million Euros, however, it will involve a lot more work than buying somewhere that’s already in good condition.
The €350k can be made up of the cost of the property and the cost of the renovations (e.g. €300k property + €50k in renovations) but you will need to hire a contractor to do the work to meet the criteria.
For those that want to DIY, you will need to spend €350k first before you can start renovating by yourself. So you could buy a property for €200k, spend €150k with a contractor, and then do the rest yourself.
One important thing to note is that you will need to have spent €350k (or €280k), and have paperwork to prove it, before you’re eligible to apply for the Golden Visa. If €150k of your €350k investment needs to be paid to the contractor, and ideally once they’ve done the work, this will slow down your starting point for residency.
You can also invest in properties that are priced €280k or more if the property is in a low density population area. While much more affordable, it’s important to remember that this will have less rental potential than a property in a city or near the coast.
- €400k – Property in a low population density area.
- €350k – Properties that are more than 30 years old or located in areas in need or renovation (the €350k can be the cost of the property + the cost of renovations).
- €280k – Properties that meet the €350k requirements but are in a low density population area.
One final downside of the property route is the additional fees that come with buying a property versus some of the other routes.
As well as the property asking price, you will also need to budget for additional fees like the Property Transfer Tax (IMT), Stamp Duty (IS) (0.8%), and the deed, notary, & registration costs. All of these fees usually come to somewhere between 5 and 10%.
Can I buy multiple properties?
This doesn’t have to be one single property purchase. You can spread the purchase across multiple properties as long as you reach the Golden Visa requirements. This could include a property for yourself and another property (or two) that you use to earn a rental income, for example.
If, on the other hand, you’re interested in co-ownership with a non-spouse or partner, the property would have to cost €1,000,000 in the case of the €500k Golden Visa for 2 people to be eligible.
Can I get a mortgage?
In some cases, you can use a mortgage or loan.
- If the property costs €600k, you can get a mortgage for €100k and still be eligible providing the €500k comes from your own money or a non-Portuguese mortgage/loan. The same example applies to the €400k/€350k/€280k properties as well.
New Golden Visa rules
The Golden Visa scheme has come under fire both in Portugal and externally from the EU.
In Portugal, especially, the scheme is seen as having contributed to Portugal’s rapidly rising house prices as many properties in Lisbon and Porto have been turned into Airbnbs.
Because of this, it’s possible that as of July 2021, properties purchased in Portugal and Lisbon after that date will no longer be eligible for the scheme. It is also possible that properties in all coastal areas will also be excluded from the scheme in an effort to bring investment to rural Portugal, but no confirmation has been given yet.
Speculating on the outcome is difficult and, if you do want to invest in Lisbon, Porto, or even a coastal area, it’s recommended that you try and start the process before the summer of 2021 just in case.
Cultural Investment (for generous benefactors)
- Cost €250,000
One of the cheapest investment options is to invest in Portuguese arts and culture, or in preserving natural heritage, however, although this is one of the cheapest options, it doesn’t usually offer any ROI (aside from the joy of being able to improve Portugal’s cultural scene).
Because of this, those looking for the cheapest investment option but with some kind of potential return – even if it’s just to hold your investment – would be better off looking at the cheapest real estate option (€280k) or perhaps even an investment in private equity funds (€350k).
Investment in funds (for investors)
- Cost: €350,000
Investing in funds, such as private equity or venture capital funds, is growing in popularity as a route to Portuguese citizenship as it’s more hands off than owning a property, especially a property that needs renovating.
Many of these funds have been set up with Golden Visa investors in mind and allow you to invest, potentially grow or earn dividends from your investment, and then take your investment out after 5 years (some have longer minimal investment periods).
An increasing number of these funds are in property, and allow you to invest in hotels or other off-plan investments.
Naturally, all of these investments pose a risk, including off-plan commercial property investments.
Example funds include:
- Venture Capital funds in startups and other businesses.
- Private Equity funds
Scientific Research Investment
- Cost: €350,000
Another option at the €350k level is scientific research investment route.
Like the cultural investment route, this option isn’t particularly popular as more people prefer to invest in something that would give them a return. The same €350k could be invested in a venture capital or private equity fund, for example, and still be eligible for the Golden Visa.
Transfer of capital (easiest & fastest)
While buying a property is fun, it also takes time. It takes time to find a property that you want to buy and it can take time to actually get the purchase put through. Basically, buying a property can add a few months to the process.
If you’re looking for the easiest and fastest route to a Portuguese passport, the transfer of capital (putting €1,000,000 into a Portuguese bank account) is definitely the easiest and the fastest option. The money needs to come from outside of Portugal, from a country that isn’t blacklisted, and you will need a confirmation from the bank.
Of course, the money has to sit there for 5 years, which means its subject to erosion through inflation if the interest rate is low. For this reason, many people opt to invest their money in some way.
However, interest rates aside, this is probably the easiest, fastest option, and the one that requires the least amount of research.
Creation of 10 full-time jobs (cheapest but most demanding)
As of 2020, this option is currently unavailable.
Incorporating a business in Portugal and creating 10 full-time jobs (for Portuguese people or foreigners with a residency permit) is another way that you can invest in Portugal and obtain the Golden Visa.
The benefit of this visa is that there is no minimum investment amount and there are no limitations on the type of visa. Obviously, however, you’ll need to pay 10 salaries, and with the minimum wage in Portugal being €635 per month, you’ll need to factor in at least €6k in monthly costs.
So, naturally, you’ll need to create a business that makes money and can support 10 employees. Because of this, this isn’t as popular as other avenues, however, it could be appealing if you’re planning on opening a branch of an existing company abroad.
Portugal has a very educated workforce and wages are low by Western European standards, and with the benefit of the Golden Visa thrown in, it could make Portugal very appealing.
Generally speaking, however, many entrepreneurs will find the option of buying a property and renting it out more appealing as there’s much less work involved.
Unless you are opening a large company, running a 10-person business is going to create a lot of work and probably require you to be in Portugal for a lot of the year. If that’s the case, this visa loses its main benefit and you might as well opt for another visa like the D2 which has no job creation requirement.
The Golden Visa isn’t cheap, which is why it’s really best for those that want a path to permanent residency or citizenship but don’t want to live in Portugal.
Not only does it include the main investment cost (e.g. a €500k property or €250k investment in the arts) but it also comes with fees and, most likely, lawyer fees as well.
€X,000 – The main investment in property, a fund, capital transfer, etc
- Plus –
€533.90 – Processing fee for the main applicant
€ 80.20 – Processing fee per family member
€5,336.40 – Residency permit fees per applicant
€5,336.40 – Residency permit fees per family member
- Renewal Fees (per main applicant and family member) –
50% of the original residency permit fee (so €2,668.20)
- Additional Fees –
While the fees vary, most lawyers charge an additional fee of around €5,000 to handle the application and renewals for you. Some charge a small additional amount per family member.
With some companies this includes the NIF (Fiscal Number) and the opening of a Portuguese bank account. If this is not included, you should factor in a few hundred Euros for this as well (here’s how to get a NIF, for example).
(A NIF is a fiscal number required for a lot of purchases, including property, and to open a bank account. Obtaining a NIF doesn’t necessarily make you a tax resident in Portugal.)
There’s also the cost of travel to Portugal for the biometrics as well as the cost of getting the necessary documents together.
For a single applicant and no families members, all of this could mean an additional €17k or so.
- €50 – NIF +
- €150 – Bank Opening +
- €500k – Property purchase +
- €533.90 – Initial Processing fee +
- €1,000 – Trip to Portugal
- €5,336.40 – Application Fee +
- €2,668.20 – First Renewal +
- €2,668.20 – Second Renewal +
- €5,000 – lawyer’s fees +
There are quite a few stages to the Golden Visa process and it can actually take almost a year to get your residency permit granted through the Golden Visa scheme (around 8-10 months on average).
Decide what you want to invest in
Because you have to stick with one investment, it’s important to make sure that this investment is a good one.
For most people, the investment will be property. It’s a really, really good idea to get external help when it comes to buying a property and definitely before you sign anything. You don’t want to sign anything without an independent lawyer reading over the contract, and you also don’t want to be looking for a lawyer at the last minute. Ideally, find your lawyer before you find the property.
If you’re buying a €350k or €280k property you will also need to make sure it fits the requirements.
If you’re buying a property, it’s also recommended that you come to Portugal and view the property before buying. This isn’t necessary, as the only time you actually need to come to Portugal is for the biometrics, but it’s generally a good idea.
A trip to Portugal could also allow you to obtain the NIF and bank account, if you want to do that yourself.
Make the investment
What’s a little bit awkward about the Golden Visa process is that you actually have to make the investment before you make the application. Basically, when you make the application, you need to have evidence that you’ve already purchased a property, invested in a fund, or started a company with 10 jobs.
Only once the money has been invested in Portugal are you eligible. This means that if you pay a 10% deposit of €50k on a €500k property you won’t yet be eligible until you complete. If, however, the property costs €5 million and you put in a 10% deposit, you would be eligible.
Again, for most people this will be a property purchase although hands-off approaches like fund investments or capital transfers are growing in popularity.
To make the investment, you need to first transfer the money to your Portuguese bank account. The money must come from a whitelisted country and not a country that Portugal considers a blacklisted tax haven. You will probably be asked to prove where the money came from (salary, inheritance, etc.).
At this stage, you should also gather all of the necessary documents.
If the documents are in any language other than Portuguese, you should get them translated/apostilled. This includes documents in English.
Submit the documents for the initial review
The next stage is to submit the documents. While you can do this yourself, most people have a lawyer handle the process.
There are two types of documents required:
- Documents about the investor (or family members).
- Documents about the investment.
Documents about the investment are fairly straight-forward e.g. the deed to the property you’ve purchased or a confirmation from the fund you’ve invested in.
The documents the applicant and family members will need include:
- Copy of passport that’s valid for more than 1 year
- Health/travel insurance to cover you while you’re in Portugal
- Criminal record (translated and apostilled) for your country and any other country you live in.
- Declarations showing you don’t owe anything to the Portuguese tax office and Portuguese social security office.
- Declaration from the Portuguese bank confirming where your money came from and where it went.
At this point, there’s a fairly small fee of €533.90. After this, there’s a waiting period which is usually around 2-3 months.
Once you get the confirmation that everything is okay, then you move onto the “real” part of the application process. This is where the documents are really inspected and where the higher fee is required.
Come to Portugal for Biometrics
The next step in the process is to attend an interview with SEF, where they will take your photo, fingerprints, and signature. This biometric data will later be put into your card.
At this point you will also pay the main €5k fee and SEF will really analyse all of your documents.
Once your fee is paid, the next stage of the process can take around 3-6 months.
Once approved, SEF will send your residency permit out around 3-4 weeks after approval.
The 5-Year Temporary Residency period
Next you will need to spend an average of 7 days per year in Portugal. These days don’t have to be consecutive, but you will need proof that you spent the required number of days in Portugal.
In practice, your residency is normally granted in 2-year blocks and you have to spend 14 days per block in Portugal, so you could just come to Portugal for 14 days every 2 years.
As mentioned, your temporary residence permit is granted in blocks: either 1-year, 2-year, 2-year or, more recently, 2-year, 2-year, 2-year.
During the renewals, you will need to provide evidence that you have maintained your original investment.
If you are planning on applying for Portuguese citizenship in year 5, it’s recommended that you start gathering your documents in year 4 and have passed the language exam so that you don’t delay your application in year 5.
After 5 years of temporary residency, you will be able to apply for permanent residency.
While the benefits of permanent residency are similar to the benefits of temporary residency, at least permanent residency only has to be renewed every 10 years. And, it can be done without the high fees of the Golden Visa program.
After 5 years of being resident in Portugal, you will also be able to apply for Portuguese citizenship.
You will need to gather a number of documents again, many of which you will have from when you applied for the Golden Visa. However, some of these documents, such as a criminal records check, will now be considered out of date so you’ll have to get new ones.
Once your citizenship application has been submitted, you should expect to wait 12-24 months before being approved.
You can sell your property or investment once you get Portuguese citizenship.