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Portugal’s Golden Visa scheme – what is changing from January 2022?

19 May 2021 2237 Views
Portugal’s Golden Visa scheme – what is changing from January 2022?

Since it was launched in 2012 to help the Portuguese economy bounce back from a damaging financial crisis, the Portuguese Golden Visa Scheme has been one of the most successful in the world.

And, from January 1 2021, it has become available to British citizens as a result of the UK no longer being part of the EU. The Golden Visa Scheme is for non-EU citizens only and has mostly been used by Chinese, Americans, Brazilians, South Africans and Turkish individuals since launching.

However, the rules are changing at the end of this year, with several high-profile areas – including Lisbon, Porto and much of the Algarve – being the main locations impacted from January 1, 2022. This is to encourage more investment in interior, low-density areas of Portugal.

Here, we take a quick look at what is changing and why investors will want to act now to take advantage of the Golden Visa Scheme on properties in the likes of Lisbon, Porto and popular coastal areas of the Algarve.

What is changing?

After a long period of uncertainty, speculation and rumour, the Portuguese government finally announced its plan for the Golden Visa Scheme earlier this year. While it was bad news for those looking to invest in Porto, Lisbon and coastal areas of the Algarve and Sintra – it did finally provide some clarity.

More parts of the Algarve were spared from the changes than expected, which means Portugal’s most popular and famous holiday region won’t be a no-go area entirely for Golden Visa investors even after the rules have been altered. Touristic complexes – including resorts with residences, apartments and villas – are also exempt from the changes, which gives investors other options.

From January 1, 2022, you will only be able to make Golden Visa investments in the interior of mainland Portugal, as well as the autonomous regions of Madeira and the Azores. You can find the exempted municipalities on pages 2-4 of this document, which includes a number of municipalities and parishes in the Algarve.

Golden Visa investment in Alcoutim, Aljezur, Castro Marim, Monchique and Vila do Bispo, the Loulé parishes of Alte, Ameixial, Salir, the Union of Parishes of Querença, Tôr and Benafim, the parish of São Marcos da Serra in the borough of Silves, and the parishes of Cachopo and Santa Catarina da Fontes do Bispo in the municipality of Tavira, will still be allowed after January 1, 2022.

This gives investors lots of different options in the Algarve and may force people to look for the hidden gems instead of the obvious targets.

That said, if you are looking to invest in Lisbon, Porto or coastal areas of the Algarve, you will want to act now, as you’ll need to get your Golden Visa application in before December 31, 2021.

What does the Golden Visa require?

Most people looking to qualify for a Golden Visa in Portugal invest through residential property. In high-density areas, a minimum investment of €500,000 for a new-build, or €350,000 for a home in need of renovation, is required.

In lower density areas such as the Algarve, the initial investment required is lower, at €280,000 for a property that is older than 35 years and in need of renovating, and €400,000 for other properties. Commercial properties and properties with a tourism license are exempt from the Golden Visa changes.

Typically, the process of getting a Golden Visa involves opening a Portuguese bank account and securing an NIF number, making the investment, and then applying for the Golden Visa. Once pre-approval has been sanctioned, you must visit Portugal to have your biometric data taken and then follows the issuing of the Golden Visa itself.

What does the Golden Visa provide?

Available to third-party nationals (which now includes British citizens), the Golden Visa provides the opportunity of five-year residency and a Portuguese passport at the end of the residency in exchange for investment.

While property is far and away the most popular vehicle for investment, there are other options, such as creating employment.

Golden Visas are typically most suitable for those who don’t necessarily want to be resident in Portugal, as to be eligible there is a much smaller number of minimum days in the country required compared to the NHR programme or the D7 and D2 visas.

The Golden Visa enables free travel throughout Schengen, but not the right to live and work in any country other than Portugal, and does not require applicants to be tax resident.

You can find out more about the Golden Visa changes and their impacts on UK citizens here. Or you can contact a multi-award winning real estate agency, Ideal Homes International, who are based in Portugal and have assisted over 100 clients obtain the Golden Visa since it began.

Their UK freephone number is 0800 133 7644 or you can call on +351 289 513 434, email on info@idealhomesinternational.com or visit their website on www.idealhoemsinternational.com and take a look at their expansive property portfolio.

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