International real estate investment has become more popular with the increased attention to residency and citizenship by investment programs. Today many investors, families, and businessmen prefer to acquire property abroad, either to produce income or to live in. While some of these programs promise residency in return for a real estate investment, some grant citizenship in a short time, e.g. six months.
With the rising popularity of real estate investment abroad, it gets more important to consider different aspects to avoid possible risks. Below we’ve listed the crucial points to help you with your international real estate plannings.
Check All Property Taxes
Buying property comes with tax obligations. It’s a standard procedure to pay a tax for the property you’ve purchased. However, there are some other annual taxes you’ll be required to pay. We suggest you check all the tax requirements before you make a big investment.
In most countries, property taxes are calculated based on the value of the property. For example, there is a difference for taxes on rural and urban properties in Portugal. Taxes also differ depending on the purpose of buying.
If you buy a property in Greece under the name of your company, you’ll be required to pay 15 percent annual tax, also known as SRET.
Learn More On The Inheritance Laws
Inheritance regulation is an important point to consider when you buy international real estate. In some countries, it’s recommended to make a will as you buy a property there.
For example, if you own a property in Spain and are a resident in the country, your assets automatically are passed on to your children. If you want another beneficiary to receive your inheritance, you’re required to make a Spanish will.
Understand Your Personal Tax Liability
If you want to live in the real estate you’ve purchased on a permanent basis, note that you’ll be considered a tax resident in the country. Depending on the regulations, you might end up paying double taxes. So, it’s very important to check the taxation treaty between your country of origin and the country where you’ve purchased a property.
Know The Limitations
Residency and citizenship by investment programs grant you different rights. For example, if you buy a property in Portugal that qualifies you for a Golden Visa, you can enjoy visa-free travel to Schengen countries. However, if your main purpose is to get Portuguese citizenship, note that you’ll need to wait a minimum of five years.
In some countries, full-time residency is required to get citizenship, for example in Spain. Turkey grants citizenship by investment in four to six months. However, a Turkish passport doesn’t allow you to travel to Europe without a visa. That’s why it’s going to be useful to check all the requirements before you make a decision.
For further reading, please refer to our ultimate guides on property investment in Portugal, Greece, Spain, and Turkey.
Get Golden Visa: Who We Are And How We Can Help You
We are a full-service investment immigration agency and investment advisory company. We provide end-to-end solutions on residence and citizenship by investment programs. We have legal professionals and chartered real estate professionals in our team.
We work with clients from all around the world, interested in making international real estate investments.
Contact us today and talk to one of our experienced team members to help you with any questions you might have on your real estate plannings.