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CAPITAL GAIN TAXES ON THE INVESTMENT

Many applicants have doubts on Capital gain taxes on the investment that an applicant makes on EUR 280,000 and EUR 350,000 investment. 

Most of the applications processed through our office have the buyback option after the waiting period and as such there is no Capital gain taxes paid by the applicant.

We have Lawyers who have almost a decade of experience and have a 100% success rate in Golden Visa applications and we at Bilimoria & Associate work on applications that will be approved with all documents in order for a family application and guide the client’s application accordingly.

The fact that most investors have applied via a rehabilitation investment in real state, makes it one of the leading experts in the real estate rehabilitation investment category from our company.

For the past years our company has been able to set an extraordinary standard in the Golden Visa Processing. Selecting as a partner, with all the developed expertise in this area, is in itself a guarantee to our success for our clients.

The Portuguese passport is a top-notch travel document allowing visa-free travel to 186 countries.

WHY THE INVESTMENT FUNDS CATEGORY IN PORTUGAL IS BECOMING A COMPLEX OPTION AS A QUALIFIED INVESTMENT FOR THE GOLDEN VISA: 

The Investment category that qualifies for a Golden Visa investment is explained in this link:  https://www.sef.pt/en/pages/conteudo-detalhe.aspx?nID=21

Capital transfer of the amount of 350 thousand Euros, or higher, for the acquisition of units of investment funds or venture capital fund of funds dedicated to the capitalisation of companies, capital injected under the Portuguese legislation, whose maturity, at the moment of the investment, is, at least, of five years and, at least, 60% of the investments is realized in commercial companies with head office in national territory.

THE INVESTMENTS:  

The commercial companies are investing in Real estate assets, SEF and the Ministry of Finance “Autoridade  Tributária” (AT) are scrutinizing these investments since in many cases they are bound to be considered under the 500,000 euro category (below) and not the 350,000 euro category Golden visa investment. These real estate assets do not normally qualify either for the 350,000 euro real estate Rehabilitation category.

The purchase of real estate property with a value equal to or above 500 thousand Euros.

GOLDEN VISA INVESTMENT CATEGORIES BREAK DOWN:

• EUR 500K:  Ready to use / New Built
• EUR 350K:  Rehabilitation Category / Buildings over 30 years / City Centers (URA)  - 94,4%
• EUR 280K: Rehabilitation Category / Buildings over 30 years / Outside urban areas         
• VCIF EUR 350K: Venture Capital Investment Fund / 350K rehabilitation / 28 GV in 5 years – 0,4%
• OTHERS:  EUR 1M Capital Transfer / 10 Jobs / Other – 5,2%

FUND CATEGORY FOR GVP: 

There is a specific prohibition for the funds of investing directly into Real estate assets (Article 10^th RJCR). The concern from Autoridade Tributária (AT) and from SEF is that the Golden Visa Investors looking at investing in this category, are being offered Fund shares of an Investment fund which is investing into real estate assets, indirectly, through a company owned by the fund. (RJCR Regime Jurídico do Capital de Risco - Legal Framework for Venture Capital). The Fund category was designed to invest in Businesses rather than Real estate.

THE GOVERNANCE OF THE INVESTMENT FUNDS AS PER THE REQUIREMENTS OF THE CMVM:

It is reflected in the current CMVM  (Portugal financial regulator, equivalent to the US SEC ) regulation arts.17 and 35 of RJCR is set up through 2 different entities, the Investment Fund and the Fund  Manager. The investment opportunities are presented by the Investment Fund, but the ultimate investment decisions taken by the Investment Fund Management Committee, at their discretion and upon the governance rules defined upfront, such as the type of asset that the Fund is authorised to be invested in. Therefore the ability for the Investment fund to influence which investments are done is very limited.

INVESTMENT FUND AND FUND MANAGER SET UP AND MAINTENANCE COSTS:  

The Set-up costs, the Depository bank fees, the Supervision fees and the Audit account for 1,5% to 2% annually of the funds invested. Which impact the net returns

KYC REQUIRED BY THE CMVM -THE PORTUGUESE FINANCIAL REGULATOR:  

In order to qualify as an investor in any fund in Portugal as per the current regulation (Regulamento CMVM nº 3 / 20115, artigo 10º, investidores qualificados), including the funds that qualify for the Golden Visa, the investor has to proof his knowledge and experience in financial transactions. In practical terms, the following rules have to be fulfilled:

- the investor has to prove that he has a personal wealth above € 500.000;

- and one of the following two rules:

a) he has done 25 financial transactions in the last year;

b) the investor is fully aware of the risks that he is assuming by investing in the fund.

THERE IS A NUMBER OF FUNDS THAT ARE OFFERING RETAIL REAL ESTATE ASSETS: 

Under the theme of Investment fund for Retail business. The appraisal of the assets involved are rarely updated in Covid-19 period. In this case , the review of any retail business driven by real estate assets , is mandatory .In the context of the new Digital Retail  Paradigm, with a global decrease in value for Retail Real Estate Assets, it becomes even a crucial factor.

LINK OF THE INVESTOR TO THE ASSET: 

On a venture capital fund, the investor is no longer directly linked to the asset, but to the VC Fund, receiving in exchange participation units in the fund. For the investor, it is a different level of assurance and security. The asset is not the collateral.

Our applications are prepared and lodged by our team of immigration lawyers specialized in obtaining Portuguese citizenship.  The conditions can differ for EU and non-EU citizens and the latter can request personalized counseling from one of our immigration lawyers.

We can guide you and assist in the preparation of your Golden Visa Program application to Portugal, which needs our continuous support for the period of five years. We strive to achieve the highest possible standards of professional service and success rate on every application that we lodge with the Immigration department.

For obtaining your EU visa through Golden Visa Program, please contact us at neville@bilimoriaassociate.com or call our office at  +91 44 2823 9229  / 4350 8191 /  2822 7127 / 2822 7222  for consultation or an appointment.

 

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