For those looking for a reasonably straightforward approach to lowering your tax burden, make international investments that also allow you to live abroad if you so choose, obtaining a second residence is a great solution. It is not inexpensive and takes some planning and time, but there can be significant financial and other benefits.
What is a second Residency?
At the simplest level, a second residency allows you to legally reside in another country on a long term basis (every country has a different definition of what long term means).
A temporary residence is one that will need to be renewed after a certain amount of time (varies by country) in order to maintain your resident status. Temporary in some countries is one year at a while in others it could be five years or more. Most countries also have rules regarding the number of days you must spend in the country in order to maintain your residence permit. How many days per year you must spend in-country again varies from country to country.
Obtaining your temporary residence can often lead to or be the initial step in obtaining permanent resident status.
In most cases, permanent residence means just that and rarely, if ever, have to go there and renew it, and you don’t have to spend time a certain amount of time in-country to maintain it either.
There are cases when having permanent residency status does not really mean permanent. The United States is an excellent example of permanent, not really meaning permanent. Having a U.S. green card (aka permanent resident permit) gives you the right to permanently live in the United States. However, when you stop living there, USCIS can cancel your permanent residency at any time. So if you have a green card, you should plan on living in the United States for 10-11 months each year or risk losing it.
The other end of the extreme is Greece. With Greek Golden Visa, you can invest $250,000 in property and receive a permanent residence permit, which is truly permanent and not easily lost. They have no requirements that you live in Greece.
So as you can see, the rules about second residence vary significantly from country to country.
Reasons Second Residencies Can Be Issued
Residence permits are issued for many reasons. The options and rules are different for every country. The terminology can be confusing as some countries refer to their residence programs as visas. However, if all you get is a residence permit, it’s technically a second residence, not a visa. Some of the most common avenues to gain a second residenct (and sometimes citizenship) are as follows:
- Family Reunification
- Business and Real Estate Investments
- Investment In Government Programs
- Significant Bank Deposits
- Be of Retirement Age and Have Income
- Self-Sufficient Income