1- WHAT PRODUCTS CAN I INVEST IN?
The residence visa for non-European investors was launched within the visa programme of Law 14/2013 (Law to support entrepreneurs and their internationalisation). These residence permits combined the attraction of foreign capital and the simplification of the usual procedures by reducing the time and general requirements.
The investments that give the right to reside and work in Spain for one year, which can be extended, are as follows:
– 2 million euros in Spanish public debt.
– 1 million euros in shares or holdings in a Spanish company.
– 1 million euros in investment, closed-end or venture capital funds set up in Spain.
– 1 million euros in bank deposits in Spanish financial institutions.
– 500,000 euros in one or more properties located in Spain.
Since 2013, the acquisition of a property with the aim of obtaining resident status has become a highly desirable tool for foreign investors due to the benefits it offers and the speed and simplicity of its processing. As in other countries, such as Portugal, France or Greece, this type of visa has been called Golden Visas.
To date, taking as a source the Land Registry and the Secretary of State and Commerce of the Ministry of Inclusion and Foreign Affairs, the Golden Visas issued in Spain have been:
| Year | Number of GV |
| 2021 | 324 (Until April) |
| 2020 | 394 |
| 2019 | 681 |
| 2018 | 599 |
| 2017 | 575 |
| 2016 | 661 |
| 2015 | 658 |
| 2014 | 489 |
| 2013 | 2 |
According to this data, from 2013 to 2021, 4,383 visas have been granted, which with a minimum investment amount of 500k, would have raised €2,197,500,000 of foreign capital.
If we take the numbers for the last year for which we have complete data, 2019:
Applications by nationality: China (455), Russia (42), Iran (21), USA (16), Mexico (13), Saudi Arabia (11), Egypt (10), Philippines (10).
Applications by property in Autonomous Communities: Catalonia (477), Andalusia (324), Madrid (251), Valencia (138), Balearic Islands (129) and Canary Islands (47).
Continuing with the 2019 numbers, in reality, we can see that although this visa is very popular, its effect is limited:
– Total number of visas issued from Law 14/2013 in the same year 2019: 8,000.
– Total number of GVs: 681
Therefore, the number of GVs issued against the total number of Law 14/2013 visas (highly skilled workers, business transfers, etc.) was less than 10%.
As an additional piece of information, according to the Colegio de Registradores de la Propiedad, approximately 500,000 dwellings were sold in Spain in 2019. Of these homes, 80,000 were purchased by foreigners (mainly English, French, German, Swedish), which constitutes 16% of foreign home purchases by foreigners, European or non-European.
The number of GVs in relation to these purchased dwellings – which do not necessarily give the right of residence – is 0.85%.
We can therefore conclude that the GVs have not been a tool that has produced tensions in the real estate market in Spain, nor have they modified supply and demand. The ultimate objective of this Visa has been to obtain foreign capital without this being linked to physical presence in Spain, and this objective has been achieved insofar as capital is being received from investors, who in some cases decide to reside (or leave their families here) and in others simply have access to the Schengen area and to Europe through a home in Spain.
As a point of controversy, the European Commission once had its eye on protecting these purchases and applying the law on money laundering in a severe manner. Certain NGOs have also expressed their dissatisfaction with this type of programme for facilitating covert discrimination.
2- GENERAL GOLDEN VISA (GV) REQUIREMENTS
The general requirements for the investment to be valid in the eyes of the visa are the following:
– To be in a regular situation in Spain.
– No criminal record.
– Make the minimum investment in the name of a holder, either an individual or a company that meets certain requirements.
– Buy one or more properties for a minimum amount of 500,000 euros before taxes.
– Buy two or more properties for a minimum amount of 500,000 euros, either in the same or in different cities.
– Buying the properties without any mortgage or associated loan up to the minimum amount established.
– For amounts over 500,000 euros, mortgage loans can be taken out.
– Deposit the funds in cash and from abroad in a bank account in a Spanish financial institution.
– Validate that the foreign funds come from “clean” sources.
– To elevate the purchase of the property(ies) to public deed and register it in the corresponding Land Registry in the name of the applicant.
3- PROCEDURE
1. At one of the Spanish consulates near the applicant’s place of residence.
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MORE INFORMATIONIn this case, the usual procedure is to apply for a 6-month visa in order to look for a property in Spain.
Once in Spain, being in this legal situation, the investor and his/her spouse or family can buy the property and apply for the visa.
2. Directly from Spain
The Golden visa is one of the few visas (together with the student visa) that can be applied for directly from Spain. In other words, the potential investor can enter Spain with a tourist visa and undertake the investment within 90 days.
The procedure to apply for the visa starts once the property has been registered in the corresponding Land Registry. In the case of acquiring several properties, the date of the last entry in the Register will be taken as the date of registration.
This is why it is important to be very mindful of the legal deadlines in order not to become irregular in the acquisition process. In general:
– You will need to apply for a NIE (and make an appointment sufficiently in advance),
– Open a bank account, deposit funds of lawful origin, let the bank carry out its audit procedure,
– Buy the property, convert the transaction into a public deed and register it in the Land Registry.
At this point it should be noted the strictness of the banks in the application of the Money Laundering Act and the responsibility of all participants in the process, whereby any suspicion must be reported.
From the moment the acquisition operation has been made official by means of the Property Registry, the following documentation must be submitted via the platform set up by the CGU:
– Completed and signed application form
– Copy of the completed passport
– Proof of sufficient financial resources for themselves and their family members during their period of residence in Spain (€2,130 per month for the interested party and €532 for each dependent family member).
– Take out private health insurance.
– Provide a criminal record certificate in the countries where he/she has resided in the last 5 years, for offences under Spanish law.
– Accreditation of the legal situation in the country at the date of application.
– Accreditation of the investment through registration in the land registry.
– Payment of the corresponding fees.
– Proof of family ties for the applicant’s relatives.
The resolution time from the moment of submission is 20 working days (one calendar month).
The length of stay granted is 2 years from the time of resolution. The renewal, as long as the property is maintained, can be for another 2 years and exceptionally for one more year.
After these 5 years, it is possible to apply for permanent residence. It is at this point that the property will be released for sale.
4- BENEFITS OF THE GOLDEN VISA
The applicant and his family members who obtain this visa, will benefit from the following points:
– There is no obligation to live in Spain in order to maintain the residence, there is no minimum number of days of presence except for what is required for the processing of the residence visa or renewal.
– The applicant and his/her family can maintain the status of non-resident for tax purposes and avoid, in general terms, the accrual of Wealth Tax (in addition to IRPF or IRNR).
– Properties can be leased from the outset.
– The property or properties that reach the threshold of 500,000 euros must be a home, but the applicant can buy other homes, or commercial premises and even take out a mortgage loan above this amount.
– The investor and his or her family can move freely throughout the rest of the European Schengen area. In fact, nothing would prevent them from spending the whole year of residence in other Schengen countries.
– The applicant and spouse may reside and work.
– Dependent children under 18 and dependent children over 18 and over 65 may reside (not work).
– Children over 18 years of age if they are economically dependent may be included in the visa also for the purpose of residence (not work).
– Although the main investment holder may not be in the country, his family may reside, work and study in a legal situation.
– The renewal (for 2 years) of the initial visa is very simple in terms of formalities as long as the properties are maintained.
In conclusion, there are areas of Spain where no Golden Visa has yet been issued. It will be interesting to see whether the Government will try to promote investment in other areas or limit it to those areas that are of most interest to the foreign population.