Having an alternative residence comes with a plethora of advantages.
For some, it could be job prospects or better education for children. For others, it could be an opportunity to live in a more stable economic environment for better business prospects.
Whatever the reasons may be, we can provide solutions to all the queries you might have.
With several countries offering the second residency through investment, it is essential to choose the one which suits and fits all your requirements.
While you may have decided that dual residency suits you & your family, we thought of listing the 10 things to consider about the dual residency.
1. Quality of Life
The first thing to consider when obtaining your dual residency is ‘Quality of Life’.
Lets us explain.
Moving to another country that is not your own will come with its own set of challenges, this is guaranteed. However, what can also be guaranteed is that you improve your quality of life. Pick a country that will give you what your home country does not. Eg. If you love the sea but live in the desert, then choose a Mediterranean country.
If you dream of a time when you can walk alone without having to turn your shoulder at every corner, then find a safe country to ease your mind.
We advise that you proceed with caution when choosing your second residence country.
Be sure that the country in which you will possibly be residing for a long time or even a few months a year is:
Safe for your family;
Has activities for all ages; and
Good connectivity throughout the country.
These are just a few of the basics.
The truth is that for whichever valid reason you decide to seek a second residency, you will need to factor in the quality of life in that country.
Who knows when you will need to retire to your second residence for;
Make sure you set up legally in a country that can provide all of the above as your safety net.
2. Political Stability
The second box to check off your list when obtaining dual residency is political stability.
While there are a number of countries offering second residence by investment, not all of them are quick to boast of a politically stable country. Ensuring your second residency in a politically stable country means that you can travel there with peace of mind whenever you need it with no unexpected conditions waiting for you on the other end.
For example, a country like Malta which offers the second residency by investment is a Republic and a member state of the EU. Although small in size, Malta boasts a stable political atmosphere enjoyed by both locals and ex-pats. It is also important to note that in Malta, the government is democratically elected every five years.
Malta is not aligned with any of the major powers and enjoys excellent relations with most countries. Malta has pioneered various processes to bring about more stability in the Euro-Med region.
Both major parties in Malta have asserted their efforts to continue to develop and support the Maltese Financial Services Sector and to attract further investment in the island.
3. Travel Privileges
One question you need to ask is; Will my second residence allows me to travel freely?
For many residency programs, the answer is no.
When investing in Malta Permanent Residence, you gain the lifetime opportunity to visit Schengen countries visa-free. It is also worth mentioning that if you are seeking residency for eventual upgrading to citizenship by investment, a country like Malta offers citizens visa-free travel to 184 countries including the USA, Canada & Australia!
4. Physical Presence
Before you invest in a second residency, it’s crucial to double-check if you are required actually to live there for a certain amount of time.
Some residency programs force you to spend time in the country or even live there full time for a year or more. This also means that you will be subject to tax in that country on your worldwide income.
In some cases, your residency permit can be revoked if these requirements are not met. Make sure you check how long you’re expected to live in a country before obtaining residency there. This is also imperative if you plan to seek citizenship in the country of your second residence.
In the case of Malta, after having obtained your Malta permanent residence, you are not required to reside in Malta.
You can use your status for travelling, as a backup residence at your disposal and coupled with the Global Residency Program for tax optimization purposes or.
Malta permanent residence cards are issued to all members of the main applicant's family, including children under 26 years of age and parents.
5. Second Residency Investment
The price tag for obtaining a second residence varies.
You can find countries which over residency for as little as $50,000 or as much as $500,000.
The price all depends on one thing: what’s in it for your future?
If you need to secure a residency which will not expire in a few years and gives you and your family access throughout Europe, then Malta Residency by Investment can be the one for you.
6. Processing Time
If efficiency is at the top of your list, then you’ll want to choose a swift residency program.
As with some of the points mentioned in this article, it all depends on the time frame that you have. If obtaining a second residence is of a high priority, then you can opt for a program like Malta’s.
Unlike other EU countries, Malta offers the fastest way to obtain permanent residence status through its government investment program. A permanent residency is far superior to the “Golden Visa” programs that are temporary residency programs that need to be renewed.
The application and documents submission process take no more than two to three months, after which successful applicants receive their Maltese permanent residence cards!
By comparison, other EU countries require applicants to reside in the state for 3-6 years prior to applying for permanent residence.
The seventh factor to consider before obtaining dual residence status in the country of your choice is connectivity.
There are a few questions you must find the answer to:
- How easy it is for a foreigner to open a bank account there?
- How easy is it to file a tax return?
- How easy is it to rent your home when you’re not living there?
Some countries require you to open a bank account and deposit cash before applying for residency, yet banks there make the process extremely difficult.
These might seem like things to settle at a later stage, but it’s worth reading up on things which might cause complications in the long run.
8. Tax Compliance
As you go through the process of filling in your second residency application, you will reach a section for TAX.
If that form requires you to file any tax return or pay tax, then it’s right to say that you will be considered a tax resident.
However, there are quite a handful of residency programs which allow you to become a resident without being a tax resident. If you are a tax resident of Malta for example, but not domiciled in Malta, then all your income generated in Malta will be taxed. All the foreign source income remitted to Malta will also be taxed. In simple words, you will only be taxed if you become a Malta tax resident.
Capital gains arising outside Malta will remain non-taxable in Malta even if received in Malta. If you are neither ordinarily resident nor domiciled in Malta, then you’ll be taxed only on income arising in Malta, i.e. income having a Malta source.
The Global Residence Program grants you a 15% beneficial tax rate on income received in Malta from foreign sources.
You may also have the possibility to claim relief from double tax treaties. To date, Malta has concluded more than 72 double taxation agreements for the avoidance of double taxation.
Learn More about Malta Tax Structure
9. Citizenship For The Near Future
If you are seriously considering a second residency, then second citizenship is definitely on the horizon.
We recommend that if you are on the path for second citizenship, then where you obtain your permanent residency first is of utmost importance. It is equally important to have a clear, unambiguous path to citizenship. This latter point is very important in view of the many promises made by immigration agents.
Consider a second residency which will give you opportunities in all possible ways. A residence permit that will affect your life with immediate second residency and also with second citizenship in the near future.
The last point that we would like to leave you with when you consider a second residency is… compatibility.
Be it if you intend to live in the country or eventually obtain a second citizenship, you need be sure that you are compatible with the country in which you will be investing.
The truth is that the country will not bend to your usual ways. The country you will live in, work in or visit throughout the year will have its own set of laws, its own culture and mannerisms. Therefore, you should take into account the bedside manners of the country you will be a new resident or citizen in the near future.
Draw out the pros and cons of the country you will be investing in and hopefully; you will feel more agreeable to the pro list.
There you have it, the 10 things to consider about an alternative or dual residency. As qualified advisors in the immigration industry, we listed the top ten queries that our past clients experienced.