Portugal offers an option of an investment fund to get a Golden Visa in Portugal. This option provides some benefits including exemption from certain taxes, low investment requirement, and a fast EU residency.
Despite being a recent option, this investment type has provided around 120 investors to get Portuguese residency.
You can apply for this option if you’re a non-EU/EEA/Swiss citizen, and over 18 years of age. It’s sufficient to make an investment of at least €350,000 in a Portuguese investment fund.
You can find more details about the investment fund option below.
What are the Advantages of the Investment Fund Option?
- The investment requirement is quite low compared to the other options like real estate investment
- You’ll have diversified investment options
- Possible tax advantages are available once you get approval for this investment type. For example:
- You’ll be exempt from stamp duty, IMI transfer tax, and annual municipal taxes. Also, there are no withholding taxes. If you’re a tax resident, withholding tax will only be 10 percent
- You may not have to pay any taxes on your fund earnings in Portugal
- Professional managers manage and control your investment. There is the Portuguese Securities Market Commission (CMVM) in Portugal. It manages all venture capital fund management companies and venture capital funds. Besides CMVM, the Bank of Portugal, the tax authorities, and the external fund manager are available to regulate the investment. So, it’ll be a transparent process.
- When necessary, you can easily exit from the investment.
- Typically, the potential gains from this type of investment are higher than other investment options.
- Lisbon and Porto offer an international hub for investors. The number of tech companies and startups is increasing day by day.
- In addition to these, you and your family members will get Portuguese residency. Also, you’ll have visa-free access to the Schengen countries. In the long term, you can even apply for Portuguese citizenship as well.
- You don’t need to be a tax resident to apply for the program. Staying in Portugal for seven days each year will suffice to maintain your residence rights.
Are There Any Disadvantages of Fund Investment Compared to Real Estate Investment?
Note that certain risks may exist arising from this option. The Portuguese funds are classified as risk funds.
There’s no guarantee for any stable yield out of your invested fund.
Choosing the Best Fund Option To Invest In
There are certain steps that you should follow to find the best option for you.
The Risk Appetite
It’s important to decide on your risk appetite. Note that no guarantee is provided for the preservation of the vested capital. The degrees of risks differ according to the risk funds.
If you like some risk, you can invest in Portugal Golden Visa investment fund focused on companies and startups. If not, you may consider real estate funds. They mainly invest in real estate properties indirectly. A certain value is guaranteed for this option, regardless of the market’s condition.
Analyzing the Funds
You can ask questions to the related fund managers before you make your investment. Consulting a professional advisor is advisable at this step for saving money and time.
How To Participate In Portuguese Funds
Typically, you’ll follow the following steps while investing in a fund:
- As a first step, you’ll choose a legal firm and an investment advisory firm
- Then, you’ll obtain your NIF (Portuguese tax number) number, and open a Portuguese bank account
- Know the funds and choose the one/ones you’ll invest in
- Then, you’ll prepare your application and KYC documentation
- At this step, you’ll transfer your funds to your bank account and then to the fund/s
- You’ll complete your fund subscription
- Then, you’ll submit your Golden Visa application to SEF. You’ll also arrange your biometrics appointment
- Finally, you’ll obtain your Portugal Golden Visa card.
2022 Changes in the Investment Fund Option
There’ll be certain changes in the Portugal Golden Visa investment fund and real estate purchase options. Shortly, these are:
- An increase in the minimum required amount for fund subscription: It’ll increase from €350,000 to €500,000
- Geographical restriction in the real estate purchase option: As of 2022, buying a residential property in Lisbon and Porto will not qualify you for a Golden Visa. The minimum investment amounts will be the same, however.
Note that current applicants and residents will not be affected by these changes.