Looking at EU Golden Visas, but not keen on investing in real estate? Thanks to recent advantageous program changes, the Italian Golden Visa now offers a highly compelling alternative to RE based programs elsewhere on the continent.
Let’s get into the details below…
Italy: The Golden Visa country you’ve never heard of.
Italy is one of the world’s most sought after travel, second home and retirement destinations – and with good reason. Whether you find yourself in Sicily or Lake Como, Cinque Terre or Verona, the country’s scenery, cuisine and culture is bound to inspire you.
For those with Italian ancestry, La Dolce Vita is within easy reach via the country’s Citizenship By Ancestry program.
NOTE: Sovereign Confidential members, let us know if you’d like a reference for a vetted legal supplier on the ground to assist you with your ancestral citizenship application.
But if you’re not part of what we refer to as the “Lucky Bloodline Club”, don’t despair; there is a way to make Italy your Plan B destination in 2022.
Introducing the Italian Golden Visa Program
Launched in 2017, Italy’s Golden Visa program didn’t exactly get off to a flying start. For starters, it isn’t a true Golden Visa program, as it doesn’t offer a real estate investment option.
Instead, it offered the following options upon launch:
- Two enterprise investment options; one in a conventional business (priced at €1 million, or ~$1,090,000), and another for innovative startups (priced at €500,000, or ~$545,000).
- A €2 million (~$2,180,000) government bond investment
- A €1 million (~$1,090,000) philanthropic initiative (effectively a non-refundable donation).
Furthermore, the requirements for the most affordable option, being the innovative startup track, were very stringent and complicated – and the risk of total capital loss for startup investments tends to be high.
In fact, the program couldn’t even compete with the low or no minimum in-country presence requirements of Portugal and Greece (an average of 7 days per year, and zero days per year, respectively).
To maintain your Italian Golden Visa, you had to spend at least 183 days per year in the country.
And the path to Italian citizenship would take a whopping 10 years (however, permanent residency can be obtained in only five years), compared with only five years for citizenship in Portugal.
Unsurprisingly, the Italian program could therefore not compete with its European competitors…
Until May 2020, when a raft of program enhancements changed all of that…
The new program enhancements at a glance
Most notably, the minimum in-country presence requirement was scrapped; you literally don’t need to spend a single day in Italy in order to maintain your residency status, making the Italian program one of only two programs to offer this benefit.
And as a bonus, you are now able to make the Golden Visa investment as a company, rather than as an individual, which means less personal financial risk, and potential tax benefits.
Speaking of taxation, Italian tax rates are high. But there is an option that could work for some people. You can apply for a Non-Domiciled Tax Regime, according to which you become an Italian tax resident, and agree to pay an annual flat tax of €100,000 on your non-Italian income.
Add €25,000 per family member that comes with you.
Now let’s have a look at the key program changes below:
| Consideration | Before May 2020 | After May 2020 |
| Investment requirement – Italian joint-stock companies |
€1 million (~$1,090,000) | €500,000 |
| Investment requirement – Innovative startup |
€500,000 (~$545,000) | €250,000 (~$272,000) |
| Investment requirement – government bonds |
€2 million (~$2,180,000) | €2 million (~$2,180,000) |
| Philanthropic donation | €1 million (~$1,090,000) | €1 million (~$1,090,000) |
| Minimum in-country presence requirement | 183 days per year or more | 0 days |
| Who can make the investment | Individuals only | Individuals AND companies |
These changes also lead to a significant uptick in applications during the pandemic period. But on the downside, real estate investments are still not an available option.
According to data released by Italy’s Ministry of Economic Development (PDF in Italian), around €18 million has been realized under the program to date. This figure is expected to more than double during the course of 2022, as already approved applicants confirm their investments in the coming months.
And predictably, the majority of applicants are favoring the pricier joint-stock investment option given the lower degree of risk involved.
The bottomline
As we’ve reported many times before, the future of property based Golden Visa programs looks set to be numbered, with Brussels taking aim at both residency and Citizenship By Investment programs as we speak.
In contrast, they take less exception with programs involving business investments, which could bode really well for Italy’s program in the near future.
But as always – assume that the programs available today are as good an offer as you’ll ever get, and that they could change or disappear altogether overnight.
So if you’re interested in making Italy your Plan B destination, take action today.
