Golden Visas Spain
Last year the Spanish Government put in place legislation changes to allow non EU nationals to travel to and reside in Spain if certain parameters and levels of investment in Spain were met.
When the legislation was first put on the statute books a number of matters were unclear.
These included whether the resident’s card would allow free travel into the whole of Spain and Europe and a lack of clarity as to the process and what constituted a suitable investment.
Over the last few months some of these questions have started to be answered.
Visa application process
In terms of the key steps for Visa application before any application can be made the applicant must first meet and or hold the required level of assets or have agreed the fiscal activity they will undertake.
The process of application for each type of Visa is slightly different and there are three types of Visas, lucrative, non lucrative and a working Visa.
If the applicant wishes to apply purely on an asset basis, and will not undertake any other fiscal activity in Spain, this is classed as non lucrative. The asset must be bought and evidenced before an application can be made. The applicant will not be required to be fiscally resident in Spain or spend the required level of days in Spain. The applicant will be required to show they have sufficient incomes from outside of Spain which will vary depending on whether it is just the individual or family members also and will require to prove they have private health care. This type of residency Visa will allow the applicant to travel within most Europe.
Acceptable assets include buying a property in Spain where the cash input from the buyer equates to € 500k or more, putting € 1m or more on Bank deposit or other Bank investment vehicles in Spain and or the purchase of a specified level in Government Bonds. For the holding of assets in Spain an NIE fiscal number will need to be applied for.
If the individual wanting to secure a Visa wishes to undertake fiscal activity when in Spain, then evidence of either a job or the type of company and or business they wish to set up must be agreed with the working ministry, the capital invested reach the required level, and sufficient funds to support themselves evidenced.
On all occasions the individual must have contracted private health care to cover their medical needs.
The first stage in the application process is to meet the requirements as laid down in the legislation, this is more complex for an applicant who wants to undertake fiscal activity in Spain or buy a business. The activity must be deemed, by the working ministry, to be of interest to Spain in an industry considered to be of financial and economic or technological advancement that will benefit the Spanish economy.
For either lucrative or non lucrative applications the asset must be bought or the work agreed before an application for a Visa can be made.
What happens after the Visa has been applied for
The initial Visa is a permit to travel and this can now only be gained by the person themselves so whilst they can take a representative with them to the designated authority, and a third party like a Spanish lawyer can prepare for them all the paperwork they must also personally attend.
Once the travel Visa is approved, which takes between 1 to 3 months, then the applicant must visit Spain to apply for the actual resident’s card. This part of the process requires fingerprinting at the Police Station and then further visits to the government office responsible for providing residence cards where the previously presented paperwork must be presented again.
From the travel visa to the resident’s cards can take up to three months. During this time the client can only leave Spain with a special permit and this should be avoided if at all possible and certainly not requested more than once. If the applicant keeps leaving Spain whilst waiting for the card to be produced, the card may be denied. This means the applicant should ideally allow for their first visit to Spain to be for a period of up to three months.
Once the card is provided the client can move freely within all of Spain and Europe and for a full fiscal residency will be required to spend a minimum of 180 days in Spain.
An important point is the applicant who wishes to reside in Spain will be fiscally resident in Spain which means they will be required to pay Spanish taxes on their worldwide incomes in Spain. If they have fiscal activity in Spain they will also be required to register for Social Security.
Technically under current law an applicant should declare all overseas assets which reach or exceed a value of € 50k when they come to Spain. Whilst these previously owned assets will not be liable for immediate tax, future capital gains and income derived from them will be. Each year any incomes derived from any overseas source will be liable for Spanish Income Tax. Fines for incomes earned outside Spain and assets owned in excess of € 50k are pretty heavy if at a later date it is found that they were not declared.
How astute the tax office in Spain will be in looking for overseas assets is difficult to assess. If however no overseas income is declared and there is insufficient fiscal activity in Spain this may raise concerns and highlight the individual to the tax office as the question will be asked as to how a lifestyle, that includes owning a large asset, is supported.
The residence card is for a year first and can then be renewed but each year the applicant must demonstrate they still meet the requirements for holding residency and must still hold the asset level required or be undertaking the fiscal activity originally agreed.
We can be contacted for more personal and detailed information on what the Visa changes may mean for you. Contact us