Live & work in Spain: „Golden Visa“ residence permit for non-EU citizens
(Von Simin Eschtehardi – Assessor jur.)
Introduction
The residence permit for investors in Spain, the so-called “Golden Visa” is regulated by Law 14/2013, dated 27 September, on supporting entrepreneurs and their internationalization (hereafter, “the Law”). What is peculiar about this Law is that it not only regulates aspects related to the support of entrepreneurs and companies, introducing important novelties in Spanish commercial, bankruptcy and tax law, but regulates a series of residence permits, an issue that was normally regulated in the Immigration Law 4/2000, of 11 of January.
To understand this, we must remind the reader of our article today about the context of Spanish economy in the year the Law was passed, 2013. The Spanish financial crisis, also known as the Great Recession in Spain, began 2008 and lasted for six years. The country was unable to bail out its financial sector and had to apply for a €100 billion rescue package provided by Europe. The main cause of Spain’s crisis was the housing bubble and the accompanying unsustainably high GDP growth rate. There was a large inventory of unsold properties that were seized, or slated to be seized, by Spanish banks. The idea with the Law was to stimulate the economy, reduce public debt and create jobs, attracting foreign investment.
So, the Law opened the door to all non-EU citizens who make a significant investment in Spain to obtain a permit to stay and work, in two steps with a lot of bureaucracy. Since his approbation and until 2019 (the latest year for which data are available) a total of 25.243 visas and residence permits where issued, from which 18,7 % of them, correspond to investors.
Conditions for applying for the “Golden Visa” as an investor
Article 63 of the Law regulates which cases are considered to be significant investments:
– Investment in public debt or financial assets, worth two million euros (2,000,000 €)
– Investments in bank deposits in Spanish corporations or in shares of Spanish companies worth one million euros or more (1,000,000 euros).
– Buying property in Spain with an investment of more than 500,000 euros.
– Execution of business projects in Spain. They must be considered and recognized as of general interest.
One of the best-known cases is the purchase of real estate with a value of at least 500,000 euros free of all charges or encumbrances, provided that the purchase took place after the entry into force of the Law, i.e. on September 29, 2013. Therefore, properties purchased prior to that date are not considered a substantial investment.
Golden Visa procedure
The “Golden Visa” is actually a procedure that encompasses two kind of administrative permits: on the one hand, the residence visa for investors, on the other hand, the residence authorization for investors. The visa is issued by the Spanish Embassies and consular offices in the country of residence of the applicant, and is valid for one year. Within this year, the applicant has to come at least one time to Spain, in order to apply for the authorization. The authorization of residence is issued in Spain (Madrid), and is valid for two years.
To apply for a “Golden Visa”, it is necessary to meet the general requirements, which include, among other things, not living illegally in Spain, being over 18 years old and having state or private health insurance. There are also other specific requirements for “Golden Visa”. The most important requirement is that the applicant must provide evidence of the project or the final purchase of the property. The purchase plan can be evidenced by means of a notarized preliminary contract with a guarantee for the purchase through a deposit or any other method provided by law. The purchase itself can in turn be proven by the title and debit deed, which was collected by the responsible Land registry.
Golden Visa and British nationals
Although the Law has been in force for more than seven years, it has grown in importance following the UK’s withdrawal from the European Union and the associated change in the status of British nationals as from January 1, 2021. British nationals who want to stay in Spain for more than three months, must apply for a residence permit within the framework of the regulations for non-EU citizen, one of them also of course the “Golden Visa”.
Citizens of the United Kingdom who can demonstrate that they lived and were legally established in Spain as of December 30, 2020, may apply for a TIE (Foreigner Identity Card) that allows them to continue living and working in Spain with practically the same rights as before, under the terms of the United Kingdom’s Withdrawal Agreement from the European Union. However, those who have arrived and arrive in Spain after January 1, 2021 will enter the general immigration regime. It is still possible to obtain residency in Spain, but several stricter conditions are now necessary, one of which is to demonstrate that you have sufficient income. Residence in Spain not equal to tax resident Finally, it should be noted that the mere fact of having a residence permit does not mean that you are considered a tax resident in Spain. In order for this to be the case, it is necessary to have stayed in Spain for at least 183 days in a calendar year. To understand more about the difference of being a resident or non-resident in Spain and his tax implications, please read our article „Die nicht-Residenten Steuer in Spanien sollte ernst genommen werden„. We’ll be delighted to assist you in any doubt regarding the application of residence permits in Spain. Contact us.
