Italian Residency Scheme VS EU Golden Visas and Citizenship by Investment Programmes
In the last few years some of the European Mediterranean Countries decided to use their appeal to attract foreign investors, allowing them to obtain a special Investing Visa. For its nature, this category of Visa has been internationally recognised as “Golden Visa”.
From country to country, different options have been adopted in accordance with the politics and the social needs of each of them. This is the reason why the investors need to consider their purchase carefully, if it will be for investment and rental or lifestyle. And also, there are many offers on the market from developers and banks but location and property type is critical to the success of the investment.
But let's talk about Italy now. We all are aware of the fact that Italy is a member state of the EU and also member of Schengen Area. Having access there means also have a key gateway to the European Single Market. Furthermore, Italy is the 3rd largest economy in the Eurozone and the 8th largest in the world, and it has recently been the 2nd largest manufacturing economy in Europe, surpassed only by Germany, and is the 6th-7th top manufacturer in the world, highly competitive in multiples sectors as machinery and automation, fashion, design, and food. Its robust tax credit schemes help companies improve their competitiveness.
In January 2017, with the Budget Law, Italy regulated the entry and residence for non-EU citizens investors, creating a golden visa program. It is not a proper Golden Visa as property investment is not allowed under this scheme. Not to be undervalued, together with the introduction of this visa, in 2017 the government introduced also a particular favorable tax regime that allows new residents to substitute regular taxation on their entire income generated outside Italian territory by paying, once, yearly, €100,000.
Investors under the Italian Golden visa program qualify for two year residence permit which can then be extended for another 3 three years. After five years the candidate will get the opportunity to qualify for permanent settlement and after 10 years of uninterrupted living there will be the opportunity to apply for citizenship. Italian passport is rated between ones of the most powerful European passport in the world with visa free access to 175 countries. Having a Visa to access in Italy mean also free movement in the Schengen zone, residency in Europe, possibility to obtain easily family residence permit. In order to obtain the Golden Visa, applicants are requested to invest alternatively a minimum of: € 500,000 in an Italian innovative "Startup Innovative" (Act n.221/2012), or € 1 million in an Italian limited company, or € 1 million in a philanthropic initiative, or € 2 million in Italian government bonds. The investments must be kept in Italy for the duration of validity of residence permit. The timescale of the procedure for the non-EU national to obtain the Visa it is quite straight forward: first there will be the need to obtain a Nulla Osta (certificate of no impediment) and afterwards, within 6 months, you must go to the Italian embassy in your country of residence to apply for a 2-year investor visa.
As previously mentioned, the Italian residency scheme is very different to the Golden Visa programmes of Portugal and Spain or Citizenship by Investment programmes of Malta and Cyprus. In these European countries there is no requirement to reside and become tax resident, no minimum stay and clearly defined programme rules.
Here following, compared and categorised in general the characteristics of the Golden Visa in each different Mediterranean European country that is offering it:
The Golden Visa program in Portugal has proved to be the most popular scheme between the European Countries. It started in 2012, and since then, the program, has been actively promoted internationally by the Portuguese government. With an investment of €500,000 in real estate in Portugal, the investor will gain a residency visa for a family, including dependent children. The visa can be renewed every two years providing the applicant spends two weeks in the country every two years. One of the most attractive options is that the investor can apply for permanent residency after 5 years and citizenship after 6 years without the need to reside in Portugal. Furthermore, investors buying into the real estate market in Portugal now have excellent prospects for capital gain in the coming years. Please check out Our article about purchasing a property in Portugal.
Cyprus offers the quickest way to own a European citizenship. Through its golden visa programme you will granted another passport ensuring you the right to be an European citizen, allowing the freedom to work, travel, study and live anywhere within the EU including the UK.An investment of €2.5 million in real estate is required. This can happen in just 3 months. The investment can be reduced down after 3 years to just €500,000. A full family qualification it is given to children up to age of 28. Applicants are required to have a clear criminal record and there is no language requirement, medical test or interview for citizenship applicants. It is a flexible option as it does not requirement to reside. Cyprus has a very favorable tax regime for individuals and companies.
Like Cyprus, also Malta has a very favourable tax regime for individuals and companies. With the Maltese Citizenship Scheme, individual investors must make a minimum contribution of €650,000 to the national development fund set up by the government, invest €150,000 in government approved financial instruments and commit to a residence in Malta for a minimum of 5 years. The property value for purchased real estate needs to be a minimum €350,000. Each family member also has to contribute a sum to the development fund of €25,000 each. The benefits after just only one year of residency are citizenship and a Maltese second passport.
In Spain, an investment of €500,000 in real estate is required to gain family residency. The investor will obtain a EU Schengen visa travel that can be renewed every two years After five years it is possible to gain permanent residency and after ten years citizenship. It is a flexible visa as it is not necessary to live and reside in Spain in order to retain and renew the investor residency visa. After several years of price declines real estate is now at rock bottom prices and the Spanish property market offers considerable potential for capital gains in the coming years.
The Greek golden visa programme grants a five year residency visa in return for an investment in real estate. An investment in property from €250,000 is required. A full family residency is usually granted.There is no minimum stay requirement and children up to the age of 21 are included in the family application. The visa is granted for five years and renewed every five years if the property investment is retained. It is not necessary to live in the country in order to retain and renew the investor visa, however citizenship can only be granted after seven years of residency. Investors in real estate in Greece must also budget for the additional taxes on real estate at 23%. Despite this, the greek programme offers the lowest cost to residency in Europe. The Greek residency programme is relatively fast, taking around 40 days until a residency card is issued. There are also favourable family rules for dependents. Several Investment opportunities are offered.
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