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November 20, 2016

Cypriot second citizenship by investment: A very fast way into Europe

Cypriot second citizenship by investment: A very fast way into Europe
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Neil Petch

Chairman of Virtugroup

Cyprus currently offers one the fastest second citizenship programmes in Europe. In just six months you could potentially gain full EU citizenship and a Cypriot passport which entitles you to the same rights as natural-born citizens.

One of the most fundamental of these rights is the ability to travel visa-free or visa-on-arrival to around 80% of countries globally. You’re also entitled to live and work in any of the 28 EU countries, leveraging a powerful and prosperous trade bloc. You’ll benefit from exceptionally well-developed infrastructure across health, education and business, as well as highly favourable tax laws.

With those advantages in mind, it’s little wonder that second citizenship of Cyprus is such a popular choice.

So what do you need to know if you’re considering the benefits of Cypriot citizenship for you, your family or your business?

Cypriot second citizenship: A closer look

Investors in Cyprus’ citizenship-by-investment programme come from a variety of different backgrounds with great diversity in their interests. From smart business people looking to unlock European trade, to families who are simply aspiring to travel more freely – whether you’re considering it from a personal or a business perspective, the scheme has plenty to offer.

So let’s look at seven major advantages to Cypriot citizenship.

1. The fastest way into Europe: Cypriot second citizenship is fast. You can potentially obtain full EU citizenship within six months from application to acceptance. Not only is this the quickest European second citizenship programme – it’s one of the fastest of any nationality. To put that into context, the next fastest EU citizenship-by-investment program is Malta and that can take up to 12 months.

You can potentially obtain full EU citizenship within six months from application to acceptance.

2. Secure lifetime citizenship: When you’re awarded a Cypriot passport, it is for life. And it cannot be revoked, meaning you’re fully protected from the whims and whimsy of policy change. This makes it a low-risk investment: You know you’re getting what you paid for, and always will. Very few other investments offer that degree of lifetime security.

3. Unlock the EU: Cyprus has been an EU member country since May 2004 which means Cypriot citizens are automatically granted full EU citizenship. As an EU citizen, you’ll enjoy several privileges including the freedom to live, work, study and travel across all 28 EU countries without restriction.

You could choose to capitalise on the strong financial markets in Germany, or learn Spanish in Spain. Perhaps the relaxing rural life of Italy or the bustle of the French Riviera. If you’re family-oriented, maybe your children will join the more than half a million other EU students who enrich themselves studying in other nations within the union.

4. Simple travel to 150+ countries: As both a British Commonwealth and EU member nation, Cyprus holds a strong position on the world stage. These global agreements grant citizens a number of benefits, including freedom to travel. As such, a Cypriot passport is one of the strongest you can have, granting you visa-free or visa-on-arrival access to 159 countries. As of 2016, Cyprus regularly ranks in the top 20 strongest passports in the world.

5. Family-friendly citizenship: Cypriot second citizenship is considered one of the most family-friendly options as it allows your family to share in the benefits of your investment. You can easily include multiple family members within your application including your spouse, children under 18 and dependent adult children under 28. You can also add your parents for an additional cost.

6. Good for business: A Cypriot passport is good for business in two major ways. Firstly, your EU citizenship grants you access to the European single market which (with a GDP of EUR 13tr last year) can prove extremely lucrative. Cypriot citizenship entitles you to freely move capital, services or goods without restriction amongst all 28 member states, so you can unlock a more profitable global marketplace.

Your EU citizenship grants you access to the European single market which (with a GDP of EUR 13tr last year) can prove extremely lucrative.

Secondly, Cyprus is known for its highly favourable tax rates. You won’t be considered a tax resident in Cyprus unless you spend over 183 days per year there – and as a non-domiciled citizen you won’t pay personal income tax. At 12.5%, the rate of corporate income tax is one of the lowest in the EU. You’ll also enjoy various other tax exemptions including inheritance tax, capital gains and foreign exchange gains.

7. Well-developed infrastructure: As an EU citizen, you can benefit from exceptional education, health and social infrastructure. Indeed, if you need medical support then many of the world’s highest ranking medical systems are European. As an EU citizen, you are also able to benefit from exceptional educational opportunities across the EU area. In fact, The Times Higher Education’s World University Ranking for 2016-2017 noted that of the best 1,000 universities across the world around 400 were based in Europe. According to The Times, Germany alone has 41 universities that are regarded as among the best in the world. So whatever your subject, as an EU citizen expanding your horizons through education is no longer pure theory – the door is open to education of the highest quality.

The process of gaining Cypriot second citizenship

Now is a good time to secure Cypriot citizenship as the government has recently reduced the total investment requirement from EUR 2.5m to EUR 2m.

To apply for Cypriot citizenship, you must meet a handful of personal and financial requirements. The personal requirements demand that you have no criminal record and that you have not had your property frozen within the EU. You must also own a Cypriot residence in which you invested at least EUR 500,000 excluding VAT. An additional EUR 500,000 investment allows you to add your parents onto your application.

These conditions satisfied, there are several investment options from which you can choose. This is another reason Cypriot citizenship-by-investment is so popular: You needn’t donate your wealth, but can invest in proactive revenue-generating activities.

You needn’t donate your wealth, but can invest in proactive revenue-generating activities.

The first option is to invest at least EUR 2m into real estate, including commercial, residential, infrastructure and land for development. You must hold these assets for a minimum of three years, after which you can reduce your investment to EUR 500,000. For instance, you could buy four apartments for EUR 500,000 each in order to qualify, and after three years you could sell three of them. If you choose the real estate option, your EUR 500,000 residence can count towards your EUR 2m minimum investment.

Secondly, you can purchase, create or participate in a Cypriot-established (and operated) organisation to the tune of at least EUR 2m. Any such business must have a proven presence in Cyprus and employ at least five Cypriot citizens. You can also invest in Cypriot financial assets such as bonds and securities as long as the entity is licensed by and active in Cyprus.

You can also qualify for second-citizenship if you hold a personal fixed term deposit of EUR 2m for at least three years in a Cypriot bank. The same applies to the deposit of a privately owned company or trust if you’re the beneficiary owner.

Finally, instead of meeting the minimum investment criteria in any one of these categories, you can mix and match as long as your total investment is at least EUR 2m. Your investment combination can also include up to EUR 500,000 of special government bonds, which you must hold for at least three years. For instance, you could invest EUR 1m in real estate, EUR 500,000 in Cypriot financial assets and EUR 500,000 in government bonds to qualify for citizenship.

After paying the initial professional fees, the application process can begin quickly and can be completed just as promptly. Although individual timelines can vary slightly, most applicants have their new passport in hand within six months.

Cypriot citizenship is a two-fold venture, allowing you to profit from investment in the growing Cypriot economy while granting you full EU citizenship. Unlike other second-citizenship programmes that require you to donate your wealth, the Cypriot programme asks only that you invest astutely. Even putting potential in-country profitability to one side, the rewards on your investment are high. Your Cypriot second citizenship allows you and your family to work, live, travel, trade and study in some of the most desirable, and lucrative, locations in the world.

Next Generation Equity is a government-approved provider of second citizenship and residency programmes tailored to the individual needs of discerning clients across the globe. To learn more about our programmes, please sign up for a free consultation via the form below.

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