The Portuguese Immigration and Borders Service (SEF) declares the number of residence permits granted each year. Between October 2012 and October 2020, a total of 386 investors from South Africa have obtained their Portuguese residence permit.
The statistics demonstrate that South Africa ranks as the fourth country considering the number of Golden Visa investments. Why are they so interested in Portugal?
- 3rd Safest Country in the World
According to the recent Global Wealth Migration Review by AfrAsia Bank, in 2019, the number of the net inflow of high net worth individuals (HNWI) into Portugal was around 1200. Comparatively, the study also indicates that South Africa is among the countries which “experienced significant (100+ HNWIs) wealth outflows during the past year”. So, it means that in 2019, more than 100 high net worth individuals (HNWI) left the country for a better life standard. The bank comments on the reason for this outflow: “if a country is losing a large number of HNWIs to migration, it is probably due to serious problems in that country such as crime, lack of business opportunities, etc.”
Luckily, Portugal creates an alternative for wealthy people. According to the 2020 Global Peace Index, Portugal ranks the third most peaceful country in the world. So, as a South African citizen, if you are worried about the high level of crime in your country, Portugal can be a relief for you and your family as well.
Similarly, the power of the healthcare system in the country is quite well-known. Portugal also proved this with its skill in handling the pandemic in the fastest and effective way. Some parts of the country were not affected by the virus at all, as Forbes suggested.
- High Demand for Golden Visa through Property Investment
The real estate market in Portugal is in high demand, especially by foreign investors. We can see the effect on the numbers of SEF statistics. Out of a total of 9.254 residency investments, 8.702 of them have been realized for real estate purchases. It is also quite affordable compared to other investment options. The minimum investment starts from €280.000, and Portugal Golden Visa €280.000 property investment is a really attractive option considering it leads to EU citizenship.
Investors can apply for a Golden Visa after buying a property in Portugal. Golden Visa is a residency by investment program. It grants you temporary residency, visa-free travel to Schengen countries as well as family inclusion. These are the immediate rights you can gain. When you fulfill the stay requirement, you can apply for permanent residency and citizenship after five years. In this case, you become an EU citizen and have visa-free access to a total of 186 countries. So, this is another important benefit of the Golden Visa for you as a non-EU citizen. In this case, you can expand your business in the European market as well. So, you can make use of the real estate option for both investment purposes and for preparing the way to create an alternative place to live.
- Incentive Tax Regulations for Foreigners
Taxation in Portugal is another issue worth mentioning. Portugal encourages foreigners with great taxation benefits it offers. The Non-Habitual Residency (NHR) is a very well-known tax regulation in Portugal. When you become a tax resident in Portugal, you can benefit from NHR. It allows you to be exempt from taxes on gifts, inheritance, and wealth (on some conditions). Furthermore, most of your foreign income will be exempt from taxation for a duration of ten years. The program speaks to the retirees as well. Pensioners are subject to taxation on their pension income at a rate of only 10% for ten years. No wonder why the Global Retirement Index 2020 put Portugal among the top best countries to retire to. The year-long mild climate of the country is another alluring factor for retirees as well.
You should also note that in general, you obtain second citizenship by birth, descent from a citizen parent, marriage, or naturalization. However, it demands quite a tiresome and long process. Or you may not fulfill any of these. So, at this point, the Golden Visa provides you the fastest and easiest process with several benefits.