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Detailed guide for those who want to get a second passport in exchange for investment: How? For how much? And what for?

Having a second citizenship is already a well-established trend.
According to The Wealth Report 2018 research, more than 34% of high net worth individuals with the capital exceeding $30,000,000 have already obtained a second citizenship, while 29% are in the process of obtaining it or considering to have dual citizenship. As Eurostat notes, in 2016 almost 25% of all the participants of the Cyprus citizenship program were Russians. Over 700 Russian citizens, including Forbes personalities, have obtained Malta’s passport in the past 3 years. Let’s go through the reasons behind the popularity of a second citizenship, and find out more about citizenship by investment programs.

What benefits does a second citizenship provide?

The motivation to get a second citizenship is often caused by the desire to travel visa-free to the Schengen countries, the United Kingdom, the USA, Canada and other countries. The reason can also hide behind an opportunity to minimize tax burden, to create a safe haven outside the homeland, and to protect capital, including cryptocurrency.
Change of citizenship and, consequently, change of tax residence, is greatly connected with countries joining the Common Reporting Standard (CRS). Apart from that, bitcoin investors all over the world strive to freely manage their cryptocurrencies, as not all countries have developed special laws to regulate taxes and cryptocurrency. For example in Russia, if a foreign account is used, one even risks getting fined for illegal currency transactions (up to 100%). Find out the details regarding cryptocurrency tax laws and the information about how to buy citizenship for bitcoins in our case.

Relevant citizenship programs by investment

The investor can choose one of the following options: to obtain either a EU country citizenship or a Caribbean country passport.
In the EU territory, a second passport is offered by Cyprus, Malta, Bulgaria and Austria. Montenegro has been rescheduling the official launch of the country’s economic citizenship program for two years now. In 2017, the Government of Moldova adopted the citizenship by investment law, but the program is still inactive. An attempt to launch the program in Georgia was not successful as well.
Five Caribbean countries officially offer to purchase their citizenship by investment: Saint Kitts and Nevis, Dominica, Antigua and Barbuda, Grenada and Saint Lucia. You can also get the passport of Vanuatu, the country in the Pacific.

EU passport vs. Caribbean citizenship: What is the difference?

A EU passport allows investors to stay in any Schengen and EU country (as for now, it also applied to the UK territory) throughout the whole year. Moreover, you can travel visa-free to 150+ countries, including Canada, South Korea and Australia. Residents of Malta and Austria can enter the US territory without obtaining visas first.
A Caribbean passport gives access to visa-free travel to the Schengen+EU areas (staying up to 90 days within a 180-day period) and to the United Kingdom (up to 180 days per year). With a passport of one of Caribbean CBI countries, you are not allowed to live in Europe permanently but you are able to cross the EU and Schengen borders any time and stay there within a set period of time. Grenada’s citizens can additionally stay in China for 30 days within a 180-day period. Apart from that, investors with Grenada citizenship can apply for the US E-2 visa which is not available to Russians, Chinese, South Africans, Brazilians, and many other nationalities. This type of visa is issued for 5 years, and it can be extended unlimited number times. A Caribbean passport holder can get a long-term visa to the USA and Canada.
Important note! If you have business interest in the Schengen countries, the UK and the USA, and do not consider large investments, the best option for you would be the purchase of a Caribbean passport. Which country should you choose? We are trying to figure this out in our article about the changes in CBI programs in 2018.

Economic citizenship and tax residence

Change of tax residence is one of the major reasons for getting a second citizenship, especially after the CRS approval. Tax residence change conditions:

  • Cyprus. You must live in the country for at least 60 days per year. Passive income tax rate (interest, dividends) in Cyprus is 0%. The profits of tax resident companies are taxed at the rate of 12.5%
  • Malta. You must live at least 183 days on the island. There is also no passive income tax in Malta. The minimum investment amount to become Malta’s citizen is €800,000. Unlike in Cyprus, where the investment is returnable, in Malta you will need to make a contribution of €650,000 into the state fund.
  • Bulgaria. You must live at least 183 days per year in the country. Corporate income tax rate here is 10% and dividend tax is 5%. The minimum investment amount for getting Bulgaria’s passport is €511,292 (returnable investment). The term of document processing in this case corresponds to 5 years. However, you can accelerate the process and get citizenship in a 2-year period. Under the accelerated procedure, the cost will be twice higher – €1,022,584
  • Caribbean countries. You cannot become a tax resident here. And the proof your center of vital interests is located exactly in the Caribbean will be a utility bill, a local phone number, a driver’s license, etc. In some cases, one will need to have either own business or to be employed by a local company.
  • Antigua and Barbuda. Antigua has recently provided the opportunity to receive a permanent resident certificate. In order to do this, you must reside 30 days a year on the island, prove receiving the income of at least $100,000 per year and pay the annual tax in the amount of $20,000. Other Caribbean countries do not provide this opportunity.

Note! You can find more details about the countries Russian investors prefer for getting a second citizenship and, consequently, tax residence, in our case.

Price comparison of the Caribbean passports for a main applicant & a family of 4
(Non-refundable contribution to a state fund)

Price comparison of the Caribbean passports | Migronis

Which offer is the most generous?

It is more beneficial for an individual investor to choose the passport of Dominica ($110,000). For the family of 4, it is better to select the citizenship of either Antigua and Barbuda or Saint Kitts and Nevis ($145,000 and $212,000, respectively). This type of investment is non-returnable. The most expensive passport is the one of Cyprus, worth over €2,000,000 of investment in real estate (can be sold in a 3-year period). But one still has to keep owning property worth €500,000.
The fastest of all is the process of getting Vanuatu’s citizenship — it takes a month. The most time-consuming procedure that takes from 12 to 14 months is obtaining Malta’s citizenship.

Caribbean citizenship: donation or real estate?

Pay attention to the 2017 statistics, according to which, for example, in Grenada, the prevailing number of investors (89 out of 125) choose the donation option to investing in real estate. What is the reason for that? It is worth noting that property of the Caribbean CBI countries is often overpriced. In rare cases, one can expect the annual income of 1-4%. One can sell the property in a 5-year period, which can be challenging.
In that regard, investors prefer to make a donation of $120,000-$170,000 than freezing $200,000-$400,000 instead. The fees are not included in this amount. Thus, the passport of Antigua and Barbuda for a family of 4, when the donation option is chosen, together with additional charges will cost around $145,000. While investing in real estate will cost one over $470,000. With business profitability rate corresponding to 20%, one can get the property investment ($400,000) returned in 5 years. The risk of real estate going down in price is not taken into consideration, however.

Are there any other passport programs?

There are no other official citizenship by investment programs. It is easy to come across fake offers of Romanian, Czech or Hungarian passports, but such schemes are in no way connected with investments. They are all about making fake birth certificates of relatives up to the third generation and getting a passport through the so-called family relations that in reality do not even exist. The consequences include deportations, fining and ban on entering the EU territory. The holder of such fake passport can be even prosecuted for document fraud.
How can you avoid getting to the tricks of fraudsters? First, you need to check the government site of the particular country if it provides the official passport program. You can also contact the related consulate.

When can an investor fail to obtain a passport?

People having a criminal record, tarnished personal or business reputation and PEPs cannot apply for Malta’s citizenship. Requirements are less strict in Cyprus and in the Caribbean. But background check is compulsory for each and every case.
A great advantage of passport programs is that the investor carries out payments only after the government approves the case. The money is transferred only to the government accounts.

Fighting for clients

About 4-5 years ago not many people knew about the opportunity to legally obtain a second passport. The media sources sometimes mentioned Saint Kitts and Nevis as some public personalities obtained its citizenship: millionaire investor Roger Ver, famous poker player Adam Bilzerian, and Russian entrepreneur Pavel Durov. The minimum cost of a second citizenship used to be $250,000. Competition at the investment immigration market has led to the situation when countries started to reduce the minimum contribution amount, while the media sources keep discussing over 10 Russian billionaires listed in Forbes who got Malta’s passport.
As of today, there are special offers active in two Caribbean countries: Saint Kitts and Nevis, Antigua and Barbuda. In March 2018, it was revealed that the minimum contribution amount in Antigua and Barbuda would be around $100,000 (the offer is valid until October 31, 2018). Since April 2018, the minimum donation amount for individual applicants into the Sustainable Growth Fund of Saint Kitts and Nevis has been $150,000 and for the family of 4 — $195,000.

Interested in more detailed information citizenship by investment programs? Contact us!

  • We offer free consultations, understanding how important it is for the client to make the only correct decision.
  • We work only in the field of investment immigration, integrating gained experience into the investor’s goal.
  • We work only with official programs of the European Union and Caribbean countries.
  • Before signing the contract, we inform our clients about all additional fees and expenses.
  • We conduct a screening to assess the investor’s chances of obtaining the desired citizenship.
  • We oversee the process at each stage and work exclusively towards the result.
  • We are in touch 24/7.
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