Travel

Exploring the Benefits of Citizenship by Investment

December 12, 2019

In most countries, citizenship is governed by two fundamental principles – jus soli and jus sanguini.

Countries like the United States follow the principle of jus soli, where the citizenship of an individual is based on where he or she is born. In jus sanguini, citizenship is acquired through one’s parents or ancestors. Countries like Argentina, Barbados, Canada, Mexico, and Peru use this principle to increase the number of their citizens.

Another way you can acquire citizenship is through investment.

What is citizenship by investment?

Citizenship by investment, also known as economic citizenship, happens when a state grants citizenship to an individual and their family members after an investment has been made with that country.

The finer details may vary from country to country, but essentially, the governing principles are the same: acquiring citizenship through investment.

That, however, does not mean that all you have to do is to invest money. On the contrary, countries that offer citizenship by investment programs use the proper legal framework and perform a thorough background check to verify a good reputation and weed out applicants with shady backgrounds.

These stringent measures have been put into place in order to ensure that individuals and their families applying for second citizenship have a transparent relationship with their host country. Furthermore, applicants benefit significantly from these measures as these allow for visa-free travel in some territories.

But what are the benefits of citizenship by investment?

Citizenship by investment benefits both individuals and the countries that run such a program. Here’s a brief look at each of these.

Protection

People living in countries with severe political and economic instability can benefit immensely from acquiring a second passport. When the situation in the individual’s home country boils over, having a second citizenship acts as failsafe and protection from political, religious, or ethnic persecution.

Lifestyle benefits

Quite simply, some countries offer better essential services like education, security, and healthcare. Acquiring second citizenship allows an individual and their family to gain access to such benefits.

Economic benefits

Countries that offer a citizenship by investment program entice individuals with high returns for their citizenship-approved investments.

Some countries offer high annual rental returns on properties of buyback guarantees. However, the majority of high net worth investors are aware that property at the highest end of the property market in prime locations is generally a great addition to any investment portfolio, given it’s historical tendency to retain or grow in value despite economic downturns.

The key is to invest in a citizenship-approved property or business that stands along as a good investment, whether or not it is approved for citizenship investors.

For countries, economic citizenship is a means to gather the necessary funds needed for its various initiatives, especially in the sectors of tourism, agriculture, and infrastructure.

Tax benefits

Acquiring second citizenship through an investment scheme can be an excellent way to reduce the taxes should you decide to become tax resident in that jurisdiction. Apart from that, economic citizenship may offer a pathway out of the double taxation conundrum, especially if your home country levies taxes on international income without respect to your tax residence.

Travel benefits

Unrestricted travel is an appealing benefit for individuals holding certain passports. Suffice to say, applying for a visa is a great inconvenience that requires a substantial investment of time and money. Additionally, the whole process of securing a visa can be frustrating to many.

Now, imagine yourself as a businessman whose job entails frequent travel to different countries. Holding a different passport spells a whole new world of difference, enabling you to visit and enter different countries without the need to apply for a visa.

Not always a quick process


Applying for citizenship via the investment route is by no means a quick process. Processing time can take anywhere from two to three months to half a year or more, depending on the country where you applied for second citizenship. In countries like the United States and Portugal, the whole process can last up to six years or longer, and involves a significant amount of physical residency and investment.

However, although the application process may take a substantial amount of time, the rewards and benefits more than make up for that.

Before making a final decision about this life-changing move, make sure that you explore every available option and potential stumbling blocks. It certainly helps to have a professional by your side to give you a clear understanding of the requirements as well as outline the whole application process for you.

AUTHOR BIO

Kal Kennard is a Partner at Citizens International, a white-glove specialist firm offering private client services necessary for citizenship investment into the Caribbean, Canada and Europe. Based in the Caribbean for the past 15 years, she is an experienced consultant who works directly with many professional partners and advises clients worldwide.

Exploring the Benefits of Citizenship by Investment was last modified: by

You Might Also Like