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Golden Visa


IMMOROSES.COM - Golden Visa Programme in Spain

Programme Overview

The Spanish golden visa programme offers a real estate investment route to gaining residency in Spain. The programme in Spain has been in operation since September, 2013. The golden visa programme in Spain is flexible in terms of the family options it offers however it is restrictive when it comes to the route to citizenship. Government fees are low and the process is quick. It is ideal for residency but less so for those requiring a second passport.

 

Investment

An investment of €500,000 is required in real estate in Spain. The property, either residential or commercial, can be rented for income. Any number of properties can combine to make up the €500,000 minimum investment. Joint buyers can combine investments into one property. The property can be mortgaged for any investment exceeding the minimum. For more information see MORE DETAILED READING BELOW.

 

Process

The applicant needs to have committed to the investment prior to applying for the visa. An application can be made once a contract for sale has been signed and prior to completion of the sale at the notary. However the funds must be ready for investment in a bank account in Spain. The application for the residency visa then takes just 10 – 15 days. It is issued for two years, if applied for in Spain, and can then be renewed for a further five years provided the investment is maintained.
Once a property has been selected through ourselves at Immoroses, the lawyers who we recommend can take care of the application process, conveyancing and legal work for the property. A typical application involves initial discussion with ourselves followed by a 3 or 4 day visit to Spain to view properties, meet with lawyers and open a bank account. The golden visa application after this point can be made within Spain or at a consulate outside of Spain. Read more on the process for the Spanish golden visa.

 

Requirements

In addition to the real estate investment applicants will need a clear criminal record, medical insurance and sufficient economic means to cover any stay in Spain. Also applicants must not have previously been refused visas or entry into the Schengen zone. Applicants satisfying such criteria are granted the golden visa in Spain.

 

Fees

Lawyer fees will apply for the processing of the golden visa for the applicant and family. Such fees will vary depending on family make up and situation. We recommend providing around €8,000 for a family application. In addition a government processing fee applies of 60 Euros. Buying real estate in Spain attracts certain taxes, stamp duty and fees. We recommend investors budget for around 11-12% in total, the main element being VAT (IVA). In addition there are conveyancing fees, typically around 1.0% of the property purchase price.

 

Family

Qualifying family members include spouse and all children under 18. Children 18 and over and parents can qualify if dependent.

 

Taxes

Investors will only be taxed on their worldwide income if they are resident in Spain for over 183 days in any year. For those non-resident individuals tax is charged at 24.75% on income derived in the country, such as rental income. This can be reduced with expenses. Capital gains tax (CGT) applies to any profit on the sale of a property. CGT starts at 24% rising to 27% for gains over €50,000. There are allowances and deductions that can be made. Annual property taxes are payable to the local authority, typically €200 – €400 per year for an apartment.

 

Living and Working

Applicants deciding to live full time in Spain will require medical insurance. However families will have access to all public services including state medical care and schooling. State schooling follows the Spanish curriculum but there are many English international schools also.

 

Travel

The Spanish residence permit gained through the golden visa allows freedom of travel throughout the EU Schengen zone.

Spanish Citizenship and Passport

Permanent Residency can be gained after five years in Spain provided the applicant has lived in the country for more than six months each year. Citizenship in Spain can be applied for after 10 years. However applicants will need to have been resident throughout that period in order to gain citizenship and a Spanish passport. Once applicants have either permanent residency or citizenship then they are free to dispose of their investment as further golden visa renewals are not necessary.

 

Benefits

Applicants gain the right to live in Spain with the golden visa although there is no requirement to do this. There is no minimum stay requirement. With the residency card all family members will have freedom to travel to and throughout the EU Schengen visa zone with ease and without further visa applications. Gaining a passport in Spain is a long process and requires the applicant to live in the country. However, eventual passport holders gain European residency, meaning the ability to live, work, study and travel freely anywhere within the European Union.

 

Summary

The application process is fast and the government fees are low. The process is very straightforward. However the key to the Spanish golden visa programme is that it is a very restrictive route to gaining citizenship and a second passport. In Spain, applicants must live in the country to gain citizenship.

More Information
For more details on the Golden Visa programme in Spain complete your details below.

 
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FOR MORE DETAILED READING …..

Spanish residency permits for property investors

The Spanish Government has finally approved the long-awaited Investor’s Residency Law (popularly dubbed as ‘Golden Visa’ law). Keen to give the ailing real estate sector a gentle nudge, it had long been mulling the idea of investor visas. Inspired by similar laws in fellow European Union member countries, Spain enacted on the 27th of September 2013 the Entrepreneur’s Law. It introduces, amongst a wide array of measures, for the first time residency visas and permits for non-EU investors.

A Law For Entrepreneur And Property Investors

Law 14/2013, of the 27th of September 2013, on support for entrepreneurs and internationalisation introduces in articles 61 through to 67 the conditions that have to be met by non-EU investors to qualify for Spanish residency. The law distinguishes clearly between residency visas and residency permits.

This new law allows non-EU investors to qualify for the highly coveted so-called Golden Visas. To summarise, this new law enables non-EU nationals to attain qualified residency permits in return for investing in Spanish real estate (and other assets), leading to permanent residency in Spain if certain conditions are fulfilled.

 

Investors’ General Requirements

Applicants pursuing investor visas / permits need to comply with the following general requirements which are specific to Non-Lucrative Residency Permits (art 62):

– Non-EU national (art 61)

– The investor applicant must be of legal age (18-years-old or over)

– The investor must not hold a criminal record whether in Spain or in the previous five years where he has resided

– Not be already in Spain irregularly

– Have access to medical insurance whether private or public

– Have sufficient financial means to support both himself and his family whilst in Spain. This should definitely not be an issue for those who have the socioeconomic profile to qualify for a Golden visa in the first place; it goes without saying.

– Pay the relevant application fee

 

Distinction between Investor Residency Visas and Residency Permits:

In addition to the above general requirements set out in art 62 which are common to both types, applicants must also meet those stipulated in articles 63 (Investor Residency Visas) and article 66 (Investor Residency Permits).

This law distinguishes two types of permits:

Residency Visas (art 63): on following the requirements (see below) one qualifies for a residency visa which entitles an investor to reside in Spain for up to one year (art 65).

Residency Permits (art 66): however, if an investor wishes to stay longer he must qualify additionally for what is known as a residency permit. This permit entitles an investor to live for up to two years in Spain and is renewable providing the requirements are still met (art 67). This permit will be granted on the following twenty days of having applied for it. It can be granted by the Administrative Silence Rule (ASR) in case of non-reply by the Authorities. This path leads eventually to Spanish citizenship.

In both cases the investment needs to be maintained during the validity of the Residency Visa or Permit. Spanish Authorities may carry out routine checks to verify this is still the case.

Investor Residency Visas

One may attain a residency visa on investing in any of the following asset classes in compliance article 63.2:

a) Investing at least €2,000,000 in Spanish Treasury bonds

b) Investing at least €1,000,000 in shares of publicly trading Spanish companies or non-trading ones

c) Depositing at least €1,000,000 in Spanish bank accounts

d) Acquisition of real estate located within Spanish territory of at least €500,000 per applicant

e) A ‘major’ business investment which fulfils at least one of the following three conditions:

i) Meaningful job creation as a direct result of the investment

ii) Significant socioeconomic impact in the geographical location where the activity will be carried out

iii) Technological or scientific impact

The law adds that the investment can be made by either a physical or legal person. The legal person must not be located in one of the countries deemed as a tax haven by the Bank of Spain. A physical person must demonstrate it exercises a holding control of the company’s shares. This translates to the investor being able to control, directly or indirectly, the majority of voting rights besides having the power to name and remove the majority of members sitting in the board of directors.

 

Investor Residency Permits

To attain a residency permit one must comply with the following (art 66):

a) Comply with the requirements laid out in art 63 (see above for more details)

b) Hold a valid investor’s residency visa or one that is not overdue by more than 90 days from the expiration date

c) Have travelled to Spain at least once during the validity of the visa stay (you must be able to support this claim with evidence)

d) Provide legal support to uphold the investments made in art 63.2.a) (see above for details) have been held during the mandatory minimum legal period required by law. Depending on the first three cases different legal documents will be required to support this claim.

e) Having complied and be up to date with all Social Security and Tax related obligations

 

Spanish “Golden Visa” Residency / Visa Permit FAQs

1. Can I request a mortgage on investing €500,000 in Spanish real estate?
Yes, but only for the excess above €500,000. The law only requires that the first €500,000 is unencumbered – meaning the equity threshold must be free. The excess can be indeed financed through a mortgage loan if necessary. What is important to understand is that the first half million euros must be mortgage-free. So an investor is expected to have the financial means to come up with these funds unassisted by a lender, whether national or foreign.

2. I have read that I need to spend in Spain more than six months to qualify for residency. Is this true?
Generally yes. However this new law specifically targets affluent individuals who will normally be residing elsewhere. The law purposely waives this requirement and only requires that a would-be investor has travelled to Spain at least once during the validity of the visa (and is able to support it through evidence). So residing six months is not necessary for the specific case of a so-called Golden Visa applicant. In fact, as can be surmised from what I’ve written, an applicant may be out of the country for more than six months and still be able to qualify for it. However if you are aiming for Spanish citizenship your main business interest must be located in Spain despite not having to reside in the country continuously for six months. Prolonged absences of over six months will not prejudice the right to attain permanent residency (five years onwards).

3. Can I attain permanent residency or even Spanish citizenship through this law?
Yes eventually, assisted by lawyers specialising in residency.

4. Does this law preclude pre-existing ways to apply for permanent residency?
No it doesn’t. Existing permits and procedures are still valid. This law is specifically tailored for affluent non-EU investors and basically helps to cut the red tape.

5. Is this proposal retro-active? I already have invested €500,000 (or more) in Spanish real estate. Can I still qualify?
No, sadly you cannot. The law came into force on the following day of being published in Spain’s Official Law Gazette (B.O.E.) which was on the 28th of September 2013. Any investment made prior to the said date will not qualify for the purposes of Law 14/2013.

6. Are there any strings attached?
None, besides parting with your money.

7. Just the investor, or investor and family?
The law specifically requires that each applicant makes an investment. However a husband/wife and children under 18 can be considered included under the same application (art 62.4).

8. Are taxes included in the investment threshold?
Short answer is no i.e. you buy a new home for €470,000 plus 10% IVA = €517,000
The applicable VAT (€47,000) would not count towards being above the €500,000 threshold. So the application would be turned down on grounds of not meeting the threshold.

9. Do holders of the so-called Golden visa have unrestricted access to move within the European Union?
Holders of a Spanish Residence Permit will not require a visa to enter the Europe Schengen area. They can transit and enjoy free movement within the Schengen area for a maximum period of three months (90 days) per half-year from the date of first entry. However, please be advised that not all countries within the European Union are party to the Schengen Agreement i.e. the United Kingdom and the Republic of Ireland maintain opt-outs.

10. Where do I apply for a visa / residency permit?
Through Spanish embassies and consulates.

“Golden Visa” Spanish Investor Residency Visas / Permits – Conclusion

Spain’s widely-publicized struggling economy offers unique investing opportunities for those savvy investors with the risk appetite to profit from today’s irrational rock-bottom prices. Spain’s housing market has clearly turned the corner in 2013. The Government has been busy approving the necessary legal amendments advised by the Troika to help pave its way out of the recession on the road to recovery. As evidence of such a recovery we have witnessed over the last six months a spectacular stock rebound across the board, led by foreign capital, which has driven blue-chip Spanish shares to former highs.

In due course, in the real economy, a resurgence of the real estate market will follow over the next years fuelled by foreign capital profiting from Spain’s (still) ridiculously low real estate prices. Granted it will not be as spectacular, and will likely take longer, than a stock rebound but it will materialise nonetheless.

It really goes without saying that the main focus on investing in Spain for residency purposes should be the asset itself. The visa or permit will follow in due course

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. 2013 © Raymundo Larraín Nesbitt. All rights reserved.