Knight Frank report: 34% of high-income individuals have obtained a second citizenship

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While some people are exploring possibilities, others are already enjoying privileges. About 34% of high net worth individuals with the income exceeding $30,000,000 have a second citizenship. This is stated in The Wealth Report 2018, the annual report by Knight Frank agency.

The number of multi-millionaires has grown by almost a third just in a year

According to the end of 2017 report, only 160,000 people in the world are considered ultra high net worth individuals (UHNWIs) with fortunes above $30 million. While the vast majority of millionaires (90%) globally have fortunes between $1 million and $5 million. Tokyo has 279,800 millionaires, London – 357,200, Dubai – 50,400, Mexico City – 86,700, São Paulo – 64,500.

Twenty-eight percent of high-income Africans, 24% of high-income Asians, 41% of high-income Latin Americans, 39% of high-income Middle East individuals, and 58% of Russian and CIS countries citizens with the capital exceeding $30,000,000 have already obtained a second citizenship (worldwide average is 34%). Analysts also state that 50% of Russian, 45% of Latin American, 35% of Middle East, and 27% of African millionaires are interested in obtaining a second passport.

IT IS NOTED IN THE REPORT THAT THE MAJORITY OF AFRICAN MILLIONAIRES WOULD LIKE TO TAKE UP PERMANENT RESIDENCE IN AUSTRALIA, US, UK, SOUTH AFRICA, WHILE RUSSIAN MILLIONAIRES CHOOSE MONACO, ITALY, SWITZERLAND, THE UNITED KINGDOM AND CYPRUS.

Out of this list, only Cyprus offers official citizenship by investment program. Other countries give one an opportunity to receive residence. Let us take a look at the details of the most popular programs.

Monaco’s residence by investment in real estate

Monaco’s residence provides one with a great opportunity to integrate into the European society and become a member of the ‘elite millionaire club’. The Principality of Monaco is one of the largest countries in the world: every 54th citizen of the jurisdiction is a multi-millionaire, and every third person has at least $1,000,000 in his/her account.

Attractive tax system and favorable business environment are among the benefits encouraging high-income people to obtain the residence of Monaco. The country has no personal income tax, capital gains tax, the tax on profits is 33.33 %. Moreover, the country residents can easily travel for business or as tourists to the Schengen countries.

The Principality of Monaco accepts people having serious own capital. Investors interested in getting Monaco’s citizenship must purchase or rent real estate in the country’s territory and prove their financial well-being. However, there is no specific requirement regarding the object price.

ACCORDING TO THE INFORMATION PROVIDED BY KNIGHT FRANK, IN THE SECOND QUARTER OF 2017 THE COST OF A SQUARE METER OF LUXURIOUS PROPERTY IN MONACO REACHED €53,000 (COMPARED TO €41,000 IN 2016).

As of today, real estate prices remain among the highest in the world, with sales dynamically increasing.

 

Knight Frank report: 34% of high-income individuals have obtained a second citizenship | Migronis

The most popular regions among customers are Fontvieille, Monte Carlo and La Condamine

To become Monaco’s resident, a candidate must:

  • officially prove the fact of real estate purchase or rent;
  • open a bank account in Monaco and deposit at least €2,000,000 on it;
  • get a visa, type D;
  • have stable and regular income sufficient for supporting the applicant himself/herself and his/her dependent members;
  • obtain health insurance for oneself and family members participating in the program (a spouse, underage children).

 

The investor is also to cover additional expenses, including:

  • €180 (€266 starting from the second year) — resident card issuance for each applicant;
  • €100 — consular charge (for each person);
  • at least €300 — health insurance.

 

There is no need to permanently live in the Principality. At the same time, resident card holders can remain in the country territory throughout the whole year.

The application processing takes 1-2 months. The resident ID is valid for a year starting from the issuance date (for underage children it is valid within a 5-year period). Upon the expiration of this term, the card is renewed for an equal period of time. In 5 years, the investor can receive Carte de sejour (which is, in fact, permanent residence), and in 10 years one can apply for citizenship.

MONACO DOES NOT SUPPORT DUAL CITIZENSHIP, THAT IS WHY THE APPLICANT WILL HAVE TO RENOUNCE THE PREVIOUS CITIZENSHIP.

Switzerland’s residence

Switzerland is a promising place for high-income business people who are interested in getting residence of a highly developed country with stable economy.

IN 2017, US NEWS & WORLD REPORT RECOGNIZED SWITZERLAND AS THE BEST COUNTRY IN THE WORLD FOR LIVING.

The ranking includes 60 countries, with the following parameters taken into consideration: quality of life, level of democracy, education quality, business environment, etc.

 

Knight Frank report: 34% of high-income individuals have obtained a second citizenship | Migronis

Switzerland is among the best countries in the world for living

There are two ways of getting the country’s residence status:

  • Launching business from the ground up. The government does not set limitations regarding the investment amount. But the investor is supposed to contribute at least €1,000,000 in the business project development. What do the authorities pay attention to? The enterprise must be beneficial for the country and the region, must create jobs and generate income.
  • Paying a fixed lump-sum tax. The tax amount ranges from €100,000 to €1,500,000 per year depending on the canton. It depends more on the expenses of the investors and his/her family than on the income. This is why the tax is calculated for each investor individually. One must additionally contribute to social insurance funds for each adult family member under 65. However, residents are not allowed to work and run business in the territory of Switzerland.

 

The term of case consideration is from 2 to 4 months (depending on the region). Resident card holders can travel visa-free to all the Schengen countries.

The main investor’s relatives, including a spouse and underage children, can also apply for residence together with the main investor. Those who want to permanently live in Switzerland must provide credible information about their assets and income.

Provided that all the program requirements are fulfilled, the resident status is renewed every year.

THE PERSON CAN APPLY FOR PERMANENT RESIDENCE ONLY 10 YEARS AFTER GETTING TEMPORARY RESIDENCE, AND FOR CITIZENSHIP -— IN ANOTHER 2 YEARS. SWITZERLAND RECOGNIZES DUAL CITIZENSHIP.

If one works in Switzerland for more than a month or lives in the country territory at least 90 days a year, one is considered a tax resident of Switzerland.

Residence of Cyprus

Since 2009, one can get Cyprus’s permanent residence in exchange for at least a €300,000 investment. What encourages foreigners to obtain a Cypriot residence?

  1. Permanent residents can live in Cyprus throughout the whole year.
  2. Favorable business environment. You can register a company in Cyprus and enjoy the benefits of low corporate tax rate (12.5%).
  3. The status is issued once for a lifetime and it applies to dependent family members, including a spouse, children under 25 and parents of both spouses. The status is inherited.
  4. The document processing takes 2 months.
  5. In a 7-year period you can apply for citizenship. There is also a citizenship by investment program valid in Cyprus. The minimum cost of the country passport is €2,000,000. The document processing takes up to 6 months.

 

It is worth noting that the residents of Cyprus cannot travel visa-free to the Schengen countries, but they can easily get a Schengen visa within a one-week period. In order to get the status renewed, one must visit Cyprus once in 2 years. There is no need to permanently live in the country.

 

Knight Frank report: 34% of high-income individuals have obtained a second citizenship | Migronis

According to the official data, economic growth in Cyprus in the second quarter of 2017 corresponded to 3.6%.

The real estate item that you plan to purchase must comply with 3 major requirements:

  • the minimum cost must be €300,000;
  • it must be offered for sale for the first time;
  • It must be put up for sale by a developer, not a private person.

 

The investor must additionally open a deposit account in a bank and have at least €30,000 on it. The retention term is 3 years.

Conclusion

A European passport can be most frequently obtained through the long-term naturalization process. The exceptions are Austria, Bulgaria and Cyprus offering citizenship by investment programs. Cyprus, according to Knight Frank research, is one of the most attractive locations for high-income Russian and CIS countries business people. The list also includes Switzerland, Monaco, Italy and the UK.

Interested in more detailed information about residence and citizenship by investment programs? Contact us!

  • We offer free consultations, understanding how important it is for the client to make the only correct decision.
  • We work only in the field of investment immigration, integrating gained experience into the investor’s goal.
  • We work only with official programs of the European Union and Caribbean countries.
  • Before signing the contract, we inform our clients about all additional fees and expenses.
  • We conduct a screening to assess the investor’s chances of obtaining the desired citizenship.
  • We oversee the process at each stage and work exclusively towards the result.
  • We are in touch 24/7.
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