The US might be a powerhouse of a country, but the number of American expats abroad is still around 9 million. Some hold dual residency, others remove their US citizenship altogether. Reasons vary: seeking another tax regime, expanding business opportunities, retiring in the country of their dreams, seeking a safer environment, and more.
If you are a US citizen who is considering relocation abroad, a residence by investment might be a convenient option for Americans. In this article, Albert Ioffe, a Legal and Compliance Officer with Immigrant Invest, discusses some of the best destinations and investment programs for US expats.
Caribbean investment programs
Why choose the Caribbean? A lot of Caribbean states are in close proximity to the US, so expats will not be far from relatives and friends. The climate here is tropical and sunny, and the ocean is always warm.
Caribbean nations, especially those in the Commonwealth, are democratic states with stable political climate, low crime rates, developed infrastructure, and high standards of living. English is the official language of 11 Caribbean territories. Economy is stable, with the Eastern Caribbean Dollar pegged to the US Dollar at ECD 2.70 = USD 1.
Transparent taxation system is in place in many Caribbean states. There are no capital gains or inheritance taxes. Except for St Lucia, there are no no taxes on interest, dividends, and royalties. No income tax in Saint Kitts and Nevis, Antigua and Barbuda.
Citizenship by Investment programs are offered by Dominica, Grenada, Antigua and Barbuda, St Kitts and Nevis, and St Lucia. Each country has at least investment options, including fund donations and real estate purchase. Investment in commercial real estate, such as tourist infrastructure, brings dividends and can be refunded in 3-5 years.
Minimum required investment sum per each Caribbean program:
- $200,000 — Dominica;
- $230,000 — Antigua and Barbuda;
- $235,000 — Grenada;
- $240,000 — St Lucia
- $250,000 — St Kitts and Nevis.
Families of investors can also be included in these programs: spouses, children, and, depending on the program, siblings, parents, and grandparents. Applicants cover Due Diligence fees, state fees for real estate purchases, and other charges. Total costs vary based on the number of family members included.
European residency for Americans: investment programs
If the tropical Caribbeans are not for you, look into relocating to Europe. While it doesn’t have programs that lead directly to citizenship, there are several great options of getting residency by investment for Americans. Investors that obtain it become eligible for permanent residence in several years, and, in some cases, for citizenship. Family inclusion is supported.
Let’s look at some of the European programs below.
Portugal Golden Visa. This is a colloquial name of the Portugal Residence by Investment program. Applicants invest €250,000+ depending on the option. Investment options include fund units, company launch, and support of Portuguese arts and cultural heritage.
Included in the Top-10 safest countries per the Global Peace Index, Portugal is great for US expats with families. It offers high quality education, including schools based on the US K-12 system. Degrees earned in local universities are recognized and valued worldwide.
Portugal has a mild climate, access to beautiful resorts by the beach, and a friendly, lively culture. The cost of living is 35% lower than in other Western European countries, yet standards of living are high.
Taxes in Portugal are lower than in the US. After becoming official residents, expats may qualify for Non-Habitual Resident (NHR) status, reducing the income tax rate to 20%. For those receiving foreign pensions, NHR status provides a flat pension tax rate of 10%.
There are other options for expats besides the Portugal Golden Visa:
- The Retirement Visa, or Portugal D7 Visa. Applicants must prove a passive income of at least €820 per month outside of Portugal;
- The Portugal Digital Nomad Visa. Available to foreigners earning at least €3,280 per month while working remotely for a foreign company. Also works for freelancers, the self-employed, and entrepreneurs.
Malta options for expats include:
- Malta Global Residence Programme. Investors spend €30,000+ plus government fees and can either lease or buy real estate in the country per its rules.
- Malta Permanent Residence Program. Investors become eligible for the respective status after buying real estate or leasing it for at least 5 years. They must invest at least €150,000 and pay government fees. Investment amounts differ depending on the Maltese region. All applicants undergo a thorough 4-tie Due Diligence check.
- Malta Naturalisation for Exceptional Services by Direct Investment regulation. Investors must fulfil several requirements: make a National Development and Social Fund contribution, make a non-governmental organization donation, and purchase or lease a residential property. They must invest at least €690,000.
Life in Malta is safe, with one of the lowest crime rates in Europe. The country’s healthcare system rivals that of the US. Malta is also praised for its education standards in the public and private sectors. Most schools follow the British curriculum.
Malta is a famously green country too, both literally and figuratively: it’s been embracing a green economy, and boasting clean Blue Flag beaches. The climate here is also one of Europe’s best, with a year-round warm sea and Mediterranean climate.
The tax system of Malta is favourable. For instance, the VAT rate is below 10%; there is no annual property tax or taxes on inheritance or gifts. Shareholders of local companies can get corporate tax returns up to 100%.
Spain Residence by Investment. This program requires a €500,000+ investment, with the options such as real estate, units, shares, government bonds, and bank deposits.
Spain is extremely popular among US expats — it currently has the largest American diaspora in Europe. It is also a 46% safer country than the US, according to the Global Peace Index.
Healthcare in Spain is considered the best in Europe according to Bloomberg, and the education system is considered the 5th best in the world per the Spanish CSIC ranking. The climate in the country is comfortably mild: summers are sunny, but not smoldering, and winters are never harsh.
In conclusion
- More than 9 million American expats reside around the globe. They relocate to places with better climate, affordable healthcare, safer environment, and other advantages.
- Those looking for a naturalization or residence permit for US citizens should consider investment programs, such as in Europe or the Carribbeans.
- Family members of American expats can be included in investment programs and relocate with the principal applicant.
