The Portuguese Immigration and Borders Service (SEF) demonstrated that a total of 8702 investors bought property in Portugal to get residency. The data is from between October of 2012 and 2020.
Here are the reasons for the high demand for this country:
Ease of mobility
Golden Visa program in Portugal offers residency in the country. In the first stage, it is a temporary renewable residence permit. However, you can get permanent residency after a certain period. Also, the country only requires you to stay for a minimum of seven days each year. This means that Portugal does not require you to move to the country. Yet, if you want to, there is this option as well.
Ease of mobility is an important factor in terms of expanding your business as well. You can bring your work to Portugal. After you gain citizenship, you can even move your business to other EU countries as an EU citizen as well. In fact, foreign direct investments (FDI) in Portugal have been on the rise in recent years. So, investors can invest in certain sectors and grow their business there. EY Attractiveness Survey 2020 shows that FDI projects in Portugal more than doubled in 2019. Furthermore, 12,549 new jobs through these projects were announced in the same year. In this regard, Portugal Golden Visa is a good opportunity to enjoy both residency and business at the same time.
Favorable tax treatments for foreigners
Portugal offers incentive taxes for its new residents. It has signed Double Taxation Agreements (DTA) with more than 60 countries. If your country of origin is among them, you can benefit from its treatments. This means that you will only be taxed once on the same income.
Another tax treatment is the Non-Habitual Resident (NHR) program. Under this program, most of your foreign income will be exempt from taxation for ten years. It also speaks to foreign retirees as well. Under NHR, their foreign pension will only be taxed at a rate of 10%. There are two conditions to benefit from NHR though. Firstly, you need to have the right to residency in Portugal. Secondly, you should not be a tax resident in Portugal within the previous five years.
Road to EU citizenship
Golden Visa programs aim at non-EU citizens. Through this program, the applicants can eventually obtain citizenship. This means that after five years of fulfilling the stay requirement, you can apply for Portugal citizenship by investment. When you become an EU citizen, you can benefit from all the rights a normal EU citizen can. This includes living, working, and studying in any EU country. Through your Golden Visa, you can travel visa-free to a total of 186 countries as well.
Low cost of living
Golden Visa applicants also take the cost of living into account. Luckily, Portugal offers favorable and quite low costs for basic needs. Compared to most Western European countries, food, accommodation, and other similar services are quite cheap. So, if you want to move to Portugal, you don’t need to hesitate about the prices.
According to Deloitte Property Index 2020, house prices are also favorable in Portugal. It indicates that “The best affordability rates were, as in the last year, in Portugal and Belgium, with 4.0 and 4.1 multiples of yearly earnings needed to purchase a dwelling in 2019 respectively.” The report also points out that in Lisbon, house prices remain one of the lowest among other Western European capitals. This can be another reason for the investors’ huge interest in the real estate market in Portugal.
Safety
Safety and economic stability are other factors determining investors’ decision in choosing a Golden Visa. In this sense, Portugal fares quite well in these areas as well. It is the third safest country in the world, according to the 2020 Global Peace Index (GPI). Factors such as crime rates, political instability, and terrorism impact were taken into consideration in this ranking. So, this makes Portugal a good option not only for investment but also for living in.
The 2020 CBI Index also puts emphasis on the importance of a safe home. “Before the Covid-19 crisis, investors looked to second citizenship as a platform from which to dive head-on into a world of greater interaction, travel, and globalization. Mobility rights took, almost inevitably, center-stage. However, by blocking international travel, the Covid-19 pandemic has had the effect of reminding investors and the wider world of the fundamental importance of ‘home’. In other words, Covid-19 has shifted investor priorities, refocusing them on places that are healthy, pleasant, and welcoming.”