Updated: Aug 17, 2022
Many countries around the world offer some form of investment-led immigration programme (could be close to 100 countries). Most of them tend to be Residency By Investment programmes (informally called the Golden Visa), whereby the investor is entitled to live and work in the country, usually with a path to eventual citizenship. A few (around 10, including 5 in the Caribbean) also offer Citizenship by Investment programmes (Golden Passport) where you can directly obtain citizenship of the country within a few weeks/months of investing.
Planning the timing of your investment is also an important consideration, irrespective of the country, and you can read more about it here.
Coming back to Portugal, of all the options available, what makes Portugal special?
Portugal as a gateway to Europe
If you are looking at the Portugal Golden Visa simply as a means to residency in Europe, this is one of the best programmes available in the region. The Portuguese passport ranks as the 6th most powerful passport in the world, and Golden Visa investors are eligible to apply for Portuguese Citizenship after 5 years. As a Portuguese Citizen, one can live and work anywhere in the European Union.
1. Low Entry Threshold
Starting at just €280,000, Portugal offers one of the lowest investment thresholds required to qualify for the Golden Visa. Even after inclusion of taxes and fees, it would add up to around €300,000 (well under ₹3 crores). You can find out more about this option here. There are other options at €350,000 or €500,000 for real estate or financial investments, and this blog post offers a comparison of venture funds v/s real estate investments.
2. Great Investment with Stability & Attractive Returns
Unlike many other countries where the "investment" is just a means of getting the Golden Visa and one is content with simply return of capital, in case of Portugal, the investments, especially in Real Estate, have done spectacularly well. Gross rental yields have been over 5%, with great capital appreciation to boot (5-10% p.a.). Moreover, the entire amount is invested in your chosen asset, there is no component of "donation" or even a "cheap loan". The Portuguese economy is relatively stable with an established rule-of-law, significantly mitigating risks of investing in a foreign land.
3. Very low Minimum Stay requirements
Once you receive the Golden Visa, you need to stay in Portugal for a minimum of only 14 days every TWO years (average of 7 days a year). The stay need not be consecutive and can be spread over multiple visits. This is perhaps one of the most attractive features of the programme.
4. Visa-Free Travel in Schengen region
The Golden Visa allows the holder to live, study and work in Portugal, enjoying all the healthcare and education benefits provided to legal residents of the country. The holder can also travel visa-free to any of the Schengen member countries for a stay of up to 90 days at a time.
5. Clear path to Citizenship
After successfully maintaining the Golden Visa for 5 years (i.e. 5 years of legal residency), one can apply for Citizenship which then entitles you to live and work in Portugal or any of the other EU countries, without the need to maintain any investment (i.e. you can divest yourself of your GV investment). Know more about your options after the Golden Visa.
6. Entire Family can be included
The lead investor and applicant can apply for the Golden Visa for the entire family under the same investment, including spouse, dependent adult children (under 26 yrs), and even parents and siblings, as long as they are dependent on the investor.
Portugal as your second/new Home
One would be seriously remiss to consider Portugal only as a means to an end. Here are some reasons why Portugal is a great option as a home/second home/retirement destination in itself, and not just a pit-stop on the road to Europe:
1. Rich in History, Culture
As one of the oldest countries in Europe, Portugal enjoys over a millennium of history, culture and prosperity. A world leader in the maritime industry in 1st millennium, Portugal is a thriving tourist paradise today, boasting distinctive architecture, music, cuisine, wines, football teams, and of course, world famous beaches. Everything you would expect from a European lifestyle - with much better weather :-)
2. Low Cost of Living
Portugal has among the lowest costs of living in Western Europe. As per the Mercer 2021 Cost of Living city ranking, Lisbon ranks lower than London, Paris, Milan, Vienna, Dublin, Amsterdam, Rome, Berlin and Madrid, among other European cities. Rents in Lisbon are less than a 3rd of those in London, Paris or Berlin. A couple could live very comfortably for under €2,900 per month inclusive of rent in Lisbon.
3. Quality Of Life
Portugal was ranked 4th on the list of Safest countries in the world (Global Peace Index 2021). It is ranked 12th for the best Healthcare in the world (WHO), ahead of the UK, Germany and USA. Portugal is ranked the best country in Europe for Expats (5th in the world) as per Expats Insider 2021. InterNations' Expat City Ranking for 2020 ranked Lisbon as the 3rd best city in the world. The Global Retirement Index 2021 ranks Portugal as the 5th best place in the world for Retirement. And of course, Portugal famously enjoys 300 days of sunshine every year, with maximum and minimum temperatures always within a tolerable range.
4. Non-Habitual Resident Tax Regime
Making Portugal your home can also be tax friendly thanks to the NHR Tax regime. Under this scheme, foreigners who are tax resident in Portugal (more than 183 days a year) need not pay any tax for 10 years on their foreign income. Click here for more information on this scheme.
5. Friendly People
"Portugal, Taiwan, and Mexico top the table when it comes to the friendliness of the local population towards foreign residents....." This is from the Expat Insider survey 2021. This would probably be the most important criterion for anyone looking to make a home in a foreign land. A warm, welcoming, open-minded community can make integration far easier.
6. Natural Beauty
Portugal is not only blessed with great, year-round weather, it also has plenty of outdoor beauty to make the most of it. The beaches around the Algarve, Cascais and the Silver Coast are among the best in the world, many a paradise for surfers. In addition, the Douro Valley in the north (home of the Port wine) and Alentejo in the east have expansive vineyards comparable to the best landscapes in the world. The Azores are volcanic islands, each home to geological wonders, and also a jump-off point for whale watching in the Atlantic. The Penada-Gerês national park is unspoilt hiking territory.
7. Business Friendly
Portugal need not be considered only as a retirement destination or a second home. With an upward economic trajectory, Portugal consistently scores highly on the World Bank’s ‘Ease of Doing Business’ reports and offers one of the lowest operation costs in western Europe. Besides, Lisbon is also among the leading cities in Europe for tech start-ups and innovation.
While the "best" Golden Visa programme will depend upon the needs, circumstances, motivations, even preferences of each individual, Portugal's intrinsic strengths as a country make it an extremely attractive choice. The Golden Visa programme has already attracted over €5 Billion in investments since it began in 2012 and has recently seen a spurt of applications even from US citizens.
Disclaimer: The facts and views presented are not a substitute for valid legal opinion. Please do consult a qualified Portuguese Immigration lawyer/tax advisor before making any decision based on the above blog post.