SECOND RESIDENCE - DECIDE NOW!
We do not sell citizenships in the Caribbean or anywhere else. This article aims to show how important and beneficial it can be to have a residence permit in more than one country.
The voluntary acceptance of a foreign citizenship would entail the loss of the own citizenship for some citizens (e.g. Austrians).
However, you can have residence permits (residences) in as many countries as you wish. This does not affect your citizenship. And in many countries, foreigners with residence permits are almost equal to nationals.
You are subject to unlimited tax liability in your European home country and also have your normal residence there? You pay the high taxes of your home country, but also enjoy the social benefits? We initially assume that you want to maintain this status, at least for the time being.
Does it still make sense for you to look around for a second home?
For example, in order to get a residence permit in St. Nevis-Kitts in the Caribbean and subsequently a passport, investments between EUR 300,000, and EUR 500,000, are usually necessary. A residence and subsequently a citizenship costs similar amounts of money, for example in Bulgaria, Portugal or other European countries.
The USA has developed its own system, namely green cards in exchange for investments in infrastructure projects. This in turn means that the US tax system will also apply to you and your world income will be taxable in the USA, on the other hand you will still be taxed in your home country.
The tax question is not dealt with in depth here either, as the question of residence in tax law requires a comprehensive examination, as does the
problem of permanent establishments.
If you acquire a residence permit in the United Arab Emirates, for example, what advantages would you have? In addition to the residence permit issued by the immigration authorities, you usually need proof of residence in the United Arab Emirates by means of a utility bill, a registration certificate or a rental contract confirmed by an authority, or a bank statement.
So when the residence is “created”, so to speak, you have – already at first sight – the following advantages (without claiming to be complete):
First of all, you could open bank and securities accounts worldwide without having to provide your home address. This would mean that the
reporting obligation in connection with the Common Reporting Standard (CRS) is directed to the country for which you have your residence permit, e.g. to the tax authorities in the UAE. This would have no disadvantage for you as no taxes are levied there. Whether or not you will also escape capital gains tax in your home country must be assessed in each individual case, but generally this can be achieved.
- You may stay in the UAE continuously for the duration of your residence permit, but you must enter the country at least once every 6 months to maintain the residence permit. You will also be given access to the smart gates, i.e. entry without passport control.
- You can have your driving license from your home country exchanged by an Emirati driving license. This would have the advantage that you can use your Emirati driving license in Europe and thus not be subject to any points system or similar negative consequences. Administrative penalties (parking offences, speeding tickets, etc.) are also not enforceable in the Emirates.
- You can rent apartments in the Emirates, buy property in certain areas, buy and sell condominiums or do other business in the Emirates. You can open accounts with Emirati banks. So you have all the advantages that your country of residence makes available to you.
- If you intend to receive your pension outside of your home country, you can receive your pension tax-free in the Emirates due to most double taxation agreements or have it transferred to any bank account if you have actually transferred your residence to the Emirates.
- You can draw up your will in accordance with the law of the DIFC (Dubai International Financial Center) and bequeath your estates without
applying the right to a compulsory portion.
It should be noted that the right of residence in another country does not in principle eliminate the unlimited tax liability in their country of main residence. A distinction must be made between whether your residence is actually in the UAE in accordance with all the conditions of tax law or whether it is only a “secondary residence”. The decisive factor for taxation is your actual (tax) residence, which is based on the center of your life
interest in accordance with the provisions of most double taxation agreements. This is linked to several criteria which often do not correspond to the “perceived” life situation (e.g. despite moving and working in the UAE, the tax residence can remain in the former country of residence, just because, for example, the wife and/or a child still maintains a residence in the country of origin). We will be happy to clarify these sometimes delicate and complex issues with you on a case-by-case basis, taking into account the relevant double taxation agreements.
Obtaining a residence permit in the Emirates is relatively easy.
- Either one establishes a business (sole proprietorship, free zone company, mainland company) or one sets up a branch of a European company in the Emirates.
- Furthermore, an employment relationship can be entered into with an Emirati employer company, which also leads to a residence permit. We have several such companies in our client base that are willing to accept foreign employees.
- Finally, there is the possibility of obtaining an investor visa by purchasing real estate and correspondingly high investments (at least AED 1,000,000 corresponding to approx. EUR 250,000).
- The so-called Dependent Resident Permit requires that a family member is already a resident in the UAE and that this family member acts as a sponsor (husband/wife, parents, possibly also children).
The costs of a residence permit depend mainly on the type of visa. An employee visa for 2 years’ costs around EUR 12,000, a company foundation with a partner visa for 3 years’ costs around EUR 20-25,000, including license fees and office rent for 3 years. Business visas for professionals cost around EUR 30,000 for 3 years.
We have used the Emirates as an example to show the advantages that such an (additional) residence permit can bring. However, we also support the acquisition of residence permits in other countries, Immigration Law is one of our focal points in all our law firms. In this area in particular, we advise multinational corporations.
Business visas are issued for 70 days, then for 3 months, 6 months and 1 year. With such a visa you are also entitled to stay in Myanmar and conduct business activities. The business visa costs only EUR 2,000 plus the state fees, which range from EUR 200 to 900. With such a visa you can open a bank account in Myanmar, also in foreign currency and thus have a “proof of residence”.
Here you must enter into an employment relationship or establish a company/branch office. The visa costs are EUR 20-25,000 including all fees. The company costs EUR 6,000 per year.
In order to receive a residence permit, either an employment with a local company is required or an own company has to be founded that also actively does business in Singapore. The founding costs amount to EUR 15,000, the annual fees are about EUR 10,000.
Retirement Visa for EUR 30,000 entitles lifelong stay and tax-free pension.
We look forward to hearing from you!