Spain vs Portugal: Which Golden Visa Program is Best?

Written By Sam Daynes (Holborn Asset Management)

There has been a lot of talk of Golden Visa schemes over the last few years. Each scheme has different rules and varying levels of benefits. Moreover, changes to these schemes have recently been a plenty. When research is done into the best EU programs the names of Portugal and Spain will inevitably top that list, but which scheme is better? 

Let’s start by explaining what a Golden Visa actually is. Essentially a Golden Visa is a residency by investment program that grants investors and their families the opportunity to live, work, and reside in a country in exchange for a qualifying investment. 

Register for Free Webinar: The Spanish Golden Visa (July 30, 2024)

Golden Visas: Main Differences Between Spain and Portugal

Portugal introduced the Golden Visa back in 2012 and has seen over 12,000 applications approved and rapidly became the ‘go-to’ choice for people looking for the best route to EU residency.

A huge draw for people looking at this option is the quick route to citizenship. The Portugal Golden Visa scheme allows applicants to change their residency to a passport in year six. Furthermore, the minimum stay requirements to do this are only five weeks in those five years. Applicants of this program started seeing passports being issued in 2018, confirming their pathway to citizenship and an EU passport.

Spain’s Golden Visa program, on the other hand, started in 2013 with over 9,000 applications approved. Spain has a longer path to citizenship. For the majority of applicants for a Golden Visa, the passport is a 10-year wait.

However, there is an exception to this rule, and for those who qualify, there is a route to citizenship in as little as two years. These applicants are current holders of ex-Spanish colony passports. 

There are many countries that make this list: Argentina, Brazil, Bolivia, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, Equatorial Guinea, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Peru, Philippines, Uruguay, and Venezuela.

It is important to note that to convert to citizenship in Spain, an applicant of an ex-Spanish colony would need to spend over six months of the year in the country during that qualifying period. Nevertheless, the Spanish passport is currently ranked the 2nd strongest in the world, compared to Portugal’s 4th

For those not looking to convert to a passport, the process is far simpler. Spain has no minimum stay requirements so simply by holding a qualifying asset, you will receive all the benefits of being a resident without the need to stay in the country.

The cost of living for both countries varies considerably depending on where you decide to settle. A very popular draw for Portugal was always the immensely popular NHR (Non-Habitual Residency) scheme.

However, this scheme was withdrawn last year and only people who qualify under the Grandfathering rules can still apply. There is a new tax regime being introduced in 2024, imaginatively being dubbed NHR 2.0. This regime is more restrictive on who can qualify but still provides some great benefits for those who do.

Golden Visa Investment Routes

So, what are the best investment options for these two countries? Well, currently both would require a minimum investment of 500k EUR (excluding donation options).

Portugal Golden Visa

Portugal removed Real Estate as an option in 2023, and so qualifying investments for Portugal are now as follows: 

  1. Business – Job Creation – 500,000 EUR for a new or existing Portugal company maintaining a minimum number of jobs.
  2. Donation – Art and Culture – 250,000 EUR for support of an artistic production or in the maintenance of national cultural heritage, arts or culture in Portugal.
  3. Venture Capital and Investment Funds – 500,000 EUR to invest into an investment fund or venture capital fund incorporated under Portuguese law. 
  4. Scientific Research – 500,000 EUR for research activities of public or private entities that are part of the National Scientific and Technological Research.

Those looking to invest in Portugal need to look for security for their capital, essentially low-risk, asset-backed, and regulated investments only. It is also important to ensure that there are no tie-ins or fees. Funds can include entry, management, performance, or exit fees that can be detrimental to the investment itself. Keeping in mind fixed-rate returns and guaranteed exit amounts to eliminate risk is also crucial. This can also bring down the investment amount initially required for the Golden Visa. 

Digital Nomad Guide to Lisbon, Portugal
Cascais, Portugal. Photo by Calin Stan (Unsplash)

Spain Golden Visa

Spain, on the other hand, still has the option of Real Estate to qualify, although how long this will remain an option is unclear. Murmurings by the opposition party to the government have already voiced their concern about this because of the effect on the housing market. The current qualifying investments for Spain are as follows:

  1. Real Estate – A total of 500,000 EUR invested into Real Estate. This can include Residential and Commercial options. It can also be made up of more than 1 property.
  2. Equity in a Business – 1,000,000 EUR invested into a business. There is a set of criteria for what would qualify under this option.
  3. Bank Deposit/Investment Fund – 1,000,000 EUR invested into a deposit account or a qualifying investment fund.
  4. Government Bonds – 2,000,000 EUR invested into Government Bonds.

It is no surprise to tell you that real estate remains by far the most popular option for this Golden Visa program. Particular care needs to be taken in Spain regarding the taxation of real estate investments.

Commercial options often make more ‘financial sense’ as a qualifying asset due to attracting far less tax. In fact, on a qualifying real estate investment, transfer tax alone on a commercial asset will be over 40,000 EUR less than a residential option.

Madrid, Spain. Photo by Jorge Fernández Salas (Unsplash)

The Spanish Golden Visa Webinar: How to Get it Hassle-free & For a Lot Less Money

If this option interests you, Holborn Assets is hosting a free webinar on the Spain Golden Visa on July 30, 2024, at 3 PM (Lisbon time, 4PM Spain). Register for a spot here

Key Points of the webinar include:

  • An introduction to Holborn Assets and Holborn Pass
  • About the Spanish Golden Visa Program
  • The Process & Benefits of a Golden Visa
  • A showcase of investment options & Real Estate
  • Live Q&A

Webinar Registration

Final Thoughts

It is clear that both Portugal and Spain have great options for people looking to qualify for the Golden Visa. For most people, it will simply come down to where they want to live. Depending on your individual situation, the best option would vary.

Whichever one feels best for you, you must ensure that appropriate research is carried out. The Golden Visa schemes are ‘residency by investment’ programs, and you need to ensure that the ’investment’ part of that is your main focus.

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