Publication date: 2022/07/25
Portugal and Madeira’s ARI (Golden Visa) scheme is one of the most popular residency-by-investment programs in the world. In this article, we’ll look at the scheme in detail and provide you will all of the knowledge and assistance you need to relocate to Madeira, either through the purchase of property or by the transfer of capital.
In late 2021, changes to Portugal’s residency through investment scheme have significantly changed the program’s investment criteria. It is now no longer possible to make real estate investments in residential property in mainland Portugal, such as Lisbon, Porto, or the coastal towns in the Algarve. RAM (Região Autónoma da Madeira) and the Azores are now the only regions in Portugal where you can gain residency through the Golden Visa programme.
What is the Madeira Golden Visa?
Madeira’s Golden Visa Program, also known as the ARI Scheme, is a five-year residency-by-investment programme for non-EU/EEA nationals and Swiss nationals, designed to attract overseas investment in Portugal.
Opportunities to become a permanent resident and a citizen after only five years are possible, provided that the qualifying investment is kept for at least five years, and that all requirements set by the Portuguese immigration and nationality laws are obeyed.
- An affordable investment opportunities including real estate, investment funds, capital transfer and company formation
- Minimum investment from €250,000
- Requirement to spend a minimum period of seven days in the first year in Portugal, then 14 days every two-year period following
- Family reunification included in the application (including spouses and dependent children)
- Option to become a Portuguese citizen through naturalisation after 5 years
- Visa-free access and travel through the Schengen area
Benefits of the ARI Scheme Include:
The benefits of Madeira’s Golden Visa are designed to attract foreign investors looking to gain access to the European Economic Area and Schengen travel zone.
- Access to the 26 nation European bloc and visa-free travel to 183 nations
- Affordable investment options starting from €250,000
- Obtain Portuguese Citizenship after 5 years
- Investment opportunities in a growing market that yield excellent returns
- Tax incentives through the NHR programmes (Non-habitual Residency scheme) which allows for lower income tax over a period of ten years.
- Short stay requirement
Other benefits of Madeira’s Golden Visa
One attractive benefit of Madeira’s golden visa is that your dependent family can be included in the application. This allows your family to enjoy the same opportunities or a second residence in Madeira.
Family members that can be included in your application are as follows:
- Your spouse or legal partner
- Children under 18 years of age
- Any dependent children under 26 years old, if they are single and enrolled as full-time students or can demonstrate that they continue to be financially dependent on the parents
- Parents of either spouse if over 66 years old (or 55 and dependent)
- Siblings under the age of 18 years from either spouse or partner if they are legal guardians, as determined by the courts
How do I apply for the Golden Visa in Madeira?
To qualify for the Golden Visa in Portugal and Madeira, you must make a qualifying investment typically in real estate or funds and hold the respective investment for five years. Madeira Company, MC Contabilidade, offer consultative advice and assistance in filing your Golden Visa application, and other aspects of your relocation to Madeira. Contact a member of our team today for more information.
To qualify for the program, you must fulfil the following Golden Visa requirements for Portugal and Madeira:
- Be a non-EU/EEA or Swiss citizen
- Minimum investment of €250,000.
- Have a clean criminal history
- Satisfy the Stay Requirement – Spending a minimum of seven days in Portugal for the first year, then no less than 14 days each subsequent two-year period.
Madeira’s Golden Visa Processing Time
Once you have identified your investment, the process can be straightforward and quick.
- Onboarding
Once you decide on your investment, you must collect the paperwork for yourself and any dependants you’ll be including in the application. Our team can ensure the correct paperwork is in order, and we’ll submit it for review on your behalf.
- Número de Identificação Fiscal and Bank Account
Your NIF is your Portuguese Fiscal identification number. MC Contabilidade will apply for your NIF (Número de Identificação Fiscal) act as fiscal representative for you. After obtaining your NIF, we can help you open a Portuguese Bank account. See our post about Número de Identificação Fiscal here.
- Make your investment
We can begin securing your investment and will guide you through the necessary paperwork required, either as a real-estate acquisition or transfer of capital.
- Online Submission
Submit your application online.
- Pre-approval
Your application will be pre-approved by the Portuguese Tax and Border authorities; on the basis you adhere to the necessary requirements.
- Bio-metrics Appointment
Once you schedule an appointment with Portugal’s Immigration Service (SEF), it takes around 2 months until you can attend a bio metrics collection session in person.
- Golden Visa Issued
Once you register your Bio-metrics, it takes around 4 months for your Golden Visa to be approved by SEF. Pay the government permit issue fee. Our team will collect your residence cards on your behalf and send them to you.
Portuguese Golden Visa investment options
Madeira’s stable economy and growing startup scene, popular with the Digital Nomad Community, make it an attractive destination for businesses looking to form a company or set up a branch in Madeira’s International Business Centre. Madeira is also experiencing a surge in new development, with new properties built to a high standard being built along the south coast.
Madeira’s Golden Visa investment opportunities include:
- Real Estate: Buy residential real estate worth at least €500,000 or €350,000 if investing in a rehabilitation project. If the residential property is located in a designated ‘low-density’ area, then a 20% discount applies.
- Commercial Real Estate: Buy commercial real estate anywhere in the country worth at least €500,000 or €350,000 if investing in a rehabilitation project. If the commercial property is located in a designated ‘low-density’ area, then a 20% discount applies.
- Buy Real Estate on Madeira or Azores: Buy residential and commercial real estate anywhere in Portugal’s autonomous islands of Madeira and Azores, worth at least €500,000 or €350,000 if investing in a rehabilitation project.
- Fund Subscription: Make a contribution in an investment qualified Fund worth at least €500,000
- Capital Transfer: Make a capital transfer of at least €1.5 million
- Scientific Research: Science or Technology research contribution of at least €500,000
- Job Creation: Company incorporation and creation of ten jobs amounting to a minimum value of €500,000
- Donation: Support the arts or reconstruction of national heritage with a donation of at least €250,000.
Portugal and Madeira’s investment fund
Investing in private equity funds or Portuguese Golden Visa venture capital funds is also a good option for acquiring residency in Madeira. The funds are managed by fund managers accredited by Portugal’s regulatory body, CMVM. Your dedicated fund manager ensures that the Portuguese Golden Visa fund investments are appropriately managed in start-ups or medium-sized projects with optimal growth potential.
For the Portuguese Golden Visa qualified investment fund, you can choose from sectors like energy, industry, technology, and real estate. See our blog on Madeira’s Investment opportunities aqui.
Golden Visa tax benefits
Madeira’s Golden Visa income tax benefits are a big draw for foreign investors looking to get the most out of their financial contribution. Visa holders don’t need to pay extra taxes on income produced outside of Portugal.
There’s also an option to register as a fiscal resident for tax purposes in Portugal. This option allows you to benefit from Portugal’s Non-Habitual Tax (NHR) Regime. NHR is a generous tax program with numerous benefits pertaining to your global income. It offers tax-free incentives on certain categories for a period of up to ten years.
Income that qualifies under the NHR program include:
- Dividends
- Royalties
- Real estate income
- Capital gains from the disposal of real estate
- Occupational pensions
- Business and self-employment profits derived from eligible occupations, double taxation agreements must also be taken in consideration.
Any income generated in Portuguese territory would be taxed at a flat rate of 20% for the first ten years and there is also the ability to pass on your wealth to a spouse or dependent without incurring inheritance or gift taxes.
Citizenship through Naturalisation
The golden visa can absolutely get you citizenship. You must hold your investment for at least five years before you’re eligible to apply for permanent residency and a Portuguese Passport. With citizenship under your belt, you can enjoy the right to live, work, and study anywhere in the EU and travel visa-free to over 182 destinations. Keep in mind that to acquire citizenship you must have a clean criminal record, have an A2 Portuguese language certificate (or be willing to undergo a Portuguese language test), and demonstrate to have genuine links to the country (simply provide evidence of your investment, along with documents that prove your registration in Portugal like your NIF number and Portuguese bank account).
Documents required
The following documents required can change at the discretion of the Portuguese government. Your documents must be submitted both for the initial application and for each renewal.
Golden Visa Portugal documents required list:
- Golden Visa application form
- Copy of a valid passport
- Deed or contract of the purchased property or signed promissory contract with proof of the deposit payment
- Declaration from your bank in Portugal confirming the transfer of funds
- Proof of Health Insurance in Portugal (only required if the investor resides in Portugal)
- Certified copy of the criminal certificate from your home country
- A completed form authorising SEF to get an extract of your Portuguese criminal records
- Declaration from you confirming compliance with the ARI investment requirements and commitment to maintaining the investment for five years
- Documents showing a good standing with the Portuguese Tax and Customs Authority and Social Security system. These can be issued 45 days prior to your online application
- Application Fee receipt – Proof of advanced payment for the application service
- Note that the certificates of criminal records or police clearance letters must have been issued no more than 90 days before your application is submitted. For all other certificates, it is 180 days.
Legalising Portuguese Golden Visa documents
Your Golden Visa documents and the Portugal Golden Visa application form must be translated into Portuguese by a certified translator and notarised by the Portuguese Consulate in your home country or by an Apostle of The Hague Convention.
Translating Portugal Golden Visa documents
Original documents must be accompanied by a certified translation in Portuguese, which may be done in one of three ways:
- By a translator who is accredited by the Portuguese Consulate
- By anyone, if the translation is certified by a Portuguese lawyer
- By the issuing country’s Consulate in Portugal
Golden Visa Application Cost
Besides travel expenses, Government fees, taxes and professional fees can add to your total Golden Visa costs.The following costs are common to all investment routes:
Government Fees
The Portuguese government charges an application fee for your initial application and any subsequent renewals.
Golden Visa application fee of €533.00 payable by the main applicant and €533.00 each family member (Spouse/Dependant).
Golden Visa issuing fee of €5.325.00 per applicant, payable once the application is approved. The issue fee upon each renewal is then reduced to €2.663.00 per applicant (the government fees are updated yearly in March).
Professional Fees
You will need to consider the cost of at least the following professional services:
- Professional assistance with your Golden Visa initial application, renewals, permanent residency application and citizenship application
- Translation and legalisation of documents
Tax representation
- Annual tax return preparation and filing in case you have Portugal-source income that is not subject to autonomous tax withheld at source, such as rents
- If you choose the real estate investment route, professional assistance with the purchase (and possibly renting) of property
- Professional assistance with setting up and running a company, if you choose to set up or buy a business
Property Purchase Taxes
Imposto de Selo (Stamp duty) at the rate of 0.8% of the transaction value applies in Portugal to the purchase of a property.
In addition, property transfer tax (“IMT”), also applies to a property purchase in Madeira. While there are variations according to property type (rural, commercial/industrial, or residential), property status (rehabilitated properties may also benefit from exemptions) and property intended use (property intended as the permanent residence of the purchaser benefits from slightly lower rates), the typical situation is that of a new residential property not intended as the owner’s permanent residence. For the purchase of such property, the applicable transfer tax rates are those indicated on this page.
Why work with MC Contabilidade?
Madeira Company, MC Contabilidade is a leader in residency, and citizenship by investment, with a professional and experienced team who can competently guide you through the process. Located in Funchal, the capital of Madeira, Madeira Company has a real estate partner, Quinta da Madeira who can work with you to find a qualifying property that meets all your requirements. For more information, contact a member of our team today and discuss your individual requirements with us.
