Citizenship by investment is a mixed blessing. Both dual nationals and their businesses may directly experience its effects. The article below sheds light on second citizenship pros and cons providing detailed information on the issue. To learn more about how to obtain a second passport and get citizenship by investment abroad, you are welcome to contact the International Wealth weathered immigration industry experts. FYI: initial consultations are free at International Wealth.
Approximately 50 years ago citizenship by investment and holders thereof were considered a unique and unheard-of phenomenon. They were unicorns. It was a common belief that average Joes should have remained loyal to one state only. According to Theodore Roosevelt Jr., U.S. President No. 26, second citizenship was “perfectly absurd” in concept.
Yet, tempora mutantur – the old Latin saying got it right. The number of second citizenship holders enjoying the related citizenship by investment benefits kept growing and ways to acquire it ran rampant. In the 1980s, it became possible to acquire citizenship by investment abroad in a flash.
If among the Internatioal Wealth readers and subscribers striving to obtain a second passport and citizenship by investment without delay, you should contact an International Wealth industry expert for assistance and advice. Go ahead and book an introductory consultation free of charge. This is simple – fill in the form below and you are good to go.
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Positives and negatives of second passport and dual citizenship
Citizenship by investment is an effective 21st century tool and its holders benefit from multiple advantages citizenship by investment has to offer. Yet, like every other coin, it has not just 2 sides but an adge as well. With CBI, applicants may experience certain negatives while trying to apply for second citizenship. On a more profound level, what losses and gains do citizenship by investment holders enjoy and suffer?
|Benefits of second citizenship||Second passport drawbacks|
|Benefits of second citizenship: family members and relatives stick together with no major issues |
Most states come with the laws providing for dual and second citizenship that may be inherited by their children. This is a good thing as families with parents having citizenship of different states are able to stick together. Basically, they enjoy the benefits of second citizenship their parents have. Various citizenship by investment schemes come with opportunities to obtain second citizenship abroad for both investors and their family members.
|Citizenship by investment applicants wishing to bring their family members along, shall pay extra |
Rules and regulations that various citizenship by investment schemes come with provide for an opportunity to include investor’s realtives in citizenship by investment applications. The above relatives include spouses, children, parents, grandparents, and on occasion siblings. Yet citizenship by investment opportunities for relatives are only open to those investors ready to pay extra. NB: the amount to pay extra is affordable. For more information, you are welcome to contact the International Weatlh team to get an individual price quote for your family.
|Benefits of second citizenship: new tax planning instruments|
Potential tax benefits of second citizenship that may be accessed or are easier accessed with citizenship by investment in the bag depend on the country granting citizenship by investment to applicants. Compared to mature economies, Caribbean jurisdictions may come with lower rates or no PIT, gift tax, or analogous taxes for fiscal residents. Their citizens enjoy a tax resident status and use related benefits the easiest. With a second passport in the bag, you are free to renounce citizenship of a state where an obligation to pay income tax is linked not to your residency but citizenship (e.g., the U.S. or Eritrea) meaning you will have to pay taxes there regardless of where you live and how long you are out of the home country.
|Additional tax liabilities and unascertainable terms|
To enjoy fiscal benefits in low-tax jurisdictions, you most likely will have to become a tax resident thereof and reside the most of the calendar year therein. Other criteria may be used to establish residency. Changing one’s tax residency to enjoy the above benefits may result in serious issues if the applicant fails to meet unascertainable terms. It is essential that you consult an experienced industry professional before making the final decision to change your tax residency.
|Travel benefits of second citizenship |
For many would-be dual nationals, the main benefits of second citizenship are the opportunities to make cross-border trips easier and benefit from no visa restrictions. First and second citizenship countries are crucial for the number of visa-free states one can visit as a dual citizen. Malta passport holders enjoy visa-free access to approximately 200 jurisdictions, including, inter alia, the U.S., Canada, and Australia. Certain countries, e.g., China, remain unavailable to them. With carefully chosen second citizenship, the number of visa-free destinations increases dramatically. An opportunity to legally use both passports to receive visas where necessary is another benefit citizenship by investment holders enjoy.
|Possible complications when crossing borders|
Dual citizens striving to use visa advantages to the max may face certain issues when crossing borders. Say, an American national shall use a U.S. passport to enter the States and exit the country, even if they have a second passport and second citizenship. The other countries set similar limitations. This is why to reap their benefits in full, dual citizens may have to build a customized strategy for trans-boder trips.
|Benefits of second citizenship are invaluable for globetrotters willing to enjoy extra protection and security |
With several passports in your bag, you enjoy extra security and are able to travel the world with fewer restrictions. The bigger your passport collection, the more consulates and/or embassies you may apply to in case of emergency while staying abroad. Benefits of second citizenship granted by the EU or the UK allow holders thereof to seek assistance from diplomatic missions of both the corresponding state and the other EU members, where necessary
|With a second passport, you risk becoming a target for terrorists or other criminalsI|
f you obtain second citizenship in any Western countries, you should keep in mind to use the document with caution when visiting certain jurisdictions. Second passport holders may become a target for terrorists and be taken hostage. This is why you should exercise extra caution when using a Western passport as an ID while traveling.
|Benefits of second citizenship allow you to legally avoid military service |
An opportunity to avoid conscription is a valuable benefit for second passport holders liable for military service in their home country. Caribbean jurisdictions like Dominica and Grenada, plus the Pacific state of Vauatu are excellent options to obtain second citizenship in next to no time (it usually takes 2 to 6 months there) and avoid army service. Prices are reasonable. To acquire citizenship by investment in Grenada, a potential CBI applicant shall make a USD 150,000 contribution to the special-purpose government fund. CBI procedures can be carried out remotely, which is an extra bonus. No high taxes to maintain the army is something to enjoy as well.
|Military service may be obligatory for second citizenship holders|
Potential citizenship by investment applicants striving to obtain a second passport abroad should keep in mind that in a new home country they may be subject to conscription. In Turkey, new citizens with second citizenship by investment in the bag may be liable for military service. Males of non-Turkish origin who obtained dual citizenship in Turkey after they turned 22 are an exception. They are exempt from military service. Dual citizens subject to compulsory military service may face other issues. Holders of U.S. passports and passports issued in a state with a compulsory military service risk losing U.S. citizenship in certain situations (e.g., if the second country’s armed forces are in the war against the U.S.).
|Medical services, employment, and education|
|Benefits of second citizenship: easier access to economic and social infrastruture |
Benefits of second citizenship iniclude economic and social infrastructure-related advantages a new citizen enjoys in their home country and new citizenship state, including, inter alia, educational and healthcare establishments, and the right to seek employment.
|New civil obligations |
Second passport holders have additional civil obligations that result from using economic and social infrastructure in citizenship states. Those wishing to use full social welfare and medical services, will have to make contributions to a social security fund in the corresponding jurisdiction.
|Benefits of second citizenship: opportunity to avoid political turbulence and red tape |
Faced with political turbulence in their home country or heightened geopolitical tensions in the region that they come from, common people may feel uneasy, if things go terribly wrong. Western residents should keep these risks in mind as the latter make second citizenship benefits obvious. If faced with political turbulence in their home state, dual nationals may go abroad together with their loved ones in no time, and shift their assets to a new jurisdiction. With second citizenship in the bag, you’ll be able to quickly leave the residence state in emergency situations like potential conflicts, civil commotions, or sanctions. This is an option if you feel uncomfortable in the home country due to excessive bureaucracy, irrational government measures (say, the government is about to cancel citizenship and passports, prohibit crossing the state border if a pandemic strikes, etc.). Second citizenship holders are able to relocate, i.e., move abroad within a short time. Dual nationals having the right to be politically active in a new home country, vote at local elections and become state employees is a distinct advantage. Dual citizens may successfully integrate into the host jurisdiction society and enjoy full political rights therein.
|Dual nationals may have no promise of political office and face additional political commitments|
When they run for government posts, dual citizens in Austrlia, Ukraine, and some other states face certain restrictions and limitations. Second citizenship prevents you from receiving government jobs in the U.S. or jobs with access to classified information. Using the above restrictions, local governments try to close legal loopholes that pose a threat to state security. The said limitations do not apply to most immigrants seeking private sector jobs but may be a hindrance to those dreaming of a political career. In certain cases, dual citizens running for government posts feel it best to renounce dual citizenship. Those who have been dual nationals since birth (e.g., if their parents were citizens of different states) face fewer issues as compared to natualized citizens or nationals who obtained citizenship in any other way. The other essential second citizenship drawback is that in certain states citizens are literally forced to be politically active. In Turkey and Egypt that issue citizenship by investment to foreigners, you will pay fines or face criminal prosecution that may potentially result in a prison sentence, if you fail to show up to the polls.
|Banking and investments|
|Benefits of second citizenship: opening bank accounts or investing with a trusted passport|
A passport issued by a respected and advanced Western nation may be used to open bank accounts under a simplified procedure and invest on a global scale regardless of the investor’s country of origin.
|To open bank accounts abroad with no hassle, a tax residency certificate issued in the country of second citizenship may be required|
To open a bank account with a new passport, the applicant may be required to prove they have links with the receiving country. A tax residency certificate, a utility bill, or an analogous document may be used as such proof. Ways to obtain them are numerous. If you intend to acquire a Grenada passport, feel free to use the Carribean concierge service to prove your presence in the second nationality state.
|Benefits of second citizenship: no restrictions as to real estate ownership in citizenship states|
Certain countries tend to limit buyer influx on their real estate markets and only grant the right to purchase properties to citizens. With dual citizenship in any such states, you will be able to own real properties as provided for under local laws and regulations. The above advantage may be used by globetrotters who travel often and need their own residences in the countries they visit. It is oftentimes a more profitable option that saves you more money compared to hotel stays or apartment rent. Investors may benefit therefrom as well.
|Issues with paying real estate taxes in several jurisdictions|
Oftentimes, property owners may face tax issues if the properties they own are located in several different states. In Spain, individuals who are not considered Spanish fiscal residents have to pay a non-resident rent income tax (IRNR, a.k.a. Impuesto sobrela Renta de No Residentes) due to owning properties in Spain. The regulation applies even if the asset in question is not actually leased out. For potential property investors, the above drawback wipes out many potential benefits they may eventually enjoy.
|Geographical diversification of assets and financial privacy|
|Benefits of second citizenship: free hand with minimizing risks via geographic diversification|
Second citizenship is a useful tool to reap all benefits international assets offer. For citizenship by investment holders, investing and doing business abroad is easier and much more efficient, regardless of where they are active, be it Portugal or the Dominican Republic. Higher financial privacy comes as an additional perk that can be achieved with foreign bank accounts, trusts, or other instruments. Citizenship by investment that makes it possible is the best solution for those who do not wish the government back home to fully control their financial transactions via the use of CRS or similar mechanisms.
|Expert assistance is a must|
It is challenging to boost financial privacy and minimize related risks via geographic diversification of assets independently. To achieve the ultimate goal, expert assistance is required. You should turn to pros boasting impeccable reputation who guarantee true privacy to customers. The International Wealth seasoned pros are here to help you accomplish any tasks and achieve any goals, from setting up trusts and opening accounts abroad to acquiring citizenship by investment in liquid assets that are guaranteed to generate passive income. Go ahead and turn to the industry’s best to succeed and make your dreams a reality the soonest.
|Interaction with judicial branch|
|Benefits of second citizenship: Immunity from groundless prosecution and trumped up charges |
Politially motivated arrests and unfair trials are the harsh reality many countries have to deal with on a daily basis. Dual citizens are not extradited, and this is an unmatched advantage second citizenship offers to holders thereof. When it seems that all is lost, dual citizens are guaranteed to walk free. The main thing is to make sure you are where you need to be before any issues arise. The good news is, you will see lots of red flags before any real headache sets in.
|Planning an escape route in advance is vital|
It is hard to do something to walk free when you are already an investigation subject and have come under scrutiny of authorities. Please be advised that it takes some time to acquire second citizenship. Hence, it is vital to start acting in advance, even if you don’t expect any trouble in the foreseeable future. No one knows what future lies ahead, and securing freedom long before a storm breaks is a reasonable effort.
Ways to obtain second citizenship: pros and cons
If you are sure citizenship by investment with all its pros and cons is your choice, and you have firmly resolved a second passport is what you need, it is likely you wish to obtain it the soonest. Feel free to choose any of the 2 options below to do it but beware each comes with its own strengths and limitations.
|Silver bullet solutions for you to obtain second citizenship – advantages||Silver bullet solutions for you to obtain second citizenship – drawbacks|
|You will remotely obtain second citizenship in a fast and easy way |
Not fortunate enough to be born a dual citizen able to reap multiple benefits thereof? Opportunities to acquire a second passport abroad in a fast and easy way do exist. You can obtain second citizenship remotely. In Vanuatu or St Kitts obtaining citizenship by investment takes 1.5 to 2 months, and investor’s personal presence in the jurisdiction is not required therefor. The offer differs to a degree from obtaining a second passport and benefits that follow by naturalization. In the latter case, the standard naturalization procedure to become a citizen takes 2 to 20 years and you will have to spend most of each year in the host country. Exceptions do exist, though. Successful applicants for the Portugal Golden Residence Program obtain citizenship in Portugal via a 5-year naturalization. Under the terms thereof, potential citizens shall spend 1 week per year in Portugal to keep their golden residence status active.
|With opportunities to do it quickly closing, it does not come cheap to acquire second citizenship within a short time |
You should factor material expenses into your budget if you wish to acquire citizenship by investment together with the related benefits in no time. Most citizenship by investment schemes come with multi-thousand USD or EUR fees. Additionally, you will pay licensed agent’s fees and administrative charges, including, inter alia, for application processing and verification. In most cases, the total price to pay equals an average apartment cost in a European capital. Where you need to get citizenship by investment in the EU and wish to reap the benefits a EU passport offers, you need to be OK with spending more as citizenship by investment in the EU will cost you approximately EUR 1,000,000. The said service costs upwards of EUR 715,000 in Malta and you will have to wait for 3 years to acquire a Malta passport. It is possible to speed up the procedures threefold but it will cost you much more. Although the benefits of citizenship by investment for both investors and host countries are obvious, the jurisdictions with citizenship by investment schemes in place face harsh criticism at present. Opponents of popular citizenship by investment schemes argue that due diligence procedures for potential CBI applicants are not thorough enough to guarantee that all anti-money-laundering and terrorism counter-financing laws and practices are followed. Oftentimes, it results in closure of citizenship by investment schemes. With this in mind, investors should do their best to apply for citizenship by investment in due time.
|Other applicants for second citizenship|
|Citizenship by investment is not the only option for you to acquire a second passport together with the resulting benefits in next to no time |
Many roads lead to dual citizenship and a second passport obtainable within a short time. If you are about to marry a foreign national, can document you have or had relatives in the host contry, e.g., your great grandparents lived there, or did military service in the said state as a foreigner, it may speed up naturalization procedures.
|Second citizenship based on army service comes with inherent risks and it is hard to prove you have kinship ties in the host country, while a sham marriage may bring you to jail |
Most states do not grant citizenship based on army service or kinship ties, i.e., having distant relatives who were or are host country citizens. The jurisdicions that offer second citizenship to those ready to join the local army demand that conscripts pass multiple tests. They may be at times sent to conflict zones. It may be challenging and lenghthy to obtain a second passport based on ancestry if you try to handle bureaucratic red tape on your own. Second citizenship based on a sham marriage is the one that you can easily lose if the marriage fraud in question comes to light. Certain states crimimalize sham marriages and your fate may be unenviable should you attempt it.
Naturalization is a cheap but lengthy way to obtain second citizenship that comes with its own merits and flaws. Feel free to check it all out in the table below.
|With dual citizenship by naturalization and valuable knowledge you’ll gain along the way, your cultural horizons will broaden dramatically|
Applicants for second citizenship by naturalization willing to obtain a second passport abroad to enjoy the resulting benefits automatically aree to reside in the host country for decades to follow. If successful, they will enjoy free access to both countries and cultures. Opportunities to study the culture of your new homeland, become a part of the local society and communities, and master a second language are essential for cultural adaptation and communication success. With its multiculturalism, the world today is full of chances and opportunities unavailable before. Being a part of 2 different cultures is a unique experience valued by employers and business partners alike. Those boasting it tend to rethink life, reevaluate set opinions, and establish new commercial ties with the host country’s business community. The latter is essential for international business people.
|Naturalization procedures are complicated and positive outcome is not guaranteed |
Being tied to your new potential homeland for years to come is not the only drawback. You will have to spend lots of time and effort to settle allpending issues and finalize legal procedures while at the same time studying a foreign language. States like Monaco make the related procedures so difficult that immigrants willing to obtain second citizenship to reap the resulting benefits fail to succeed. Authorities may reject citizenship applications with no clear reasons and candidates for citizenship receive no second chances to re-apply.
Wishing to keep benefits of second citizenship? Privacy is key to success
In an ideal world, you could enlarge your passport collection non-stop to gain more and more benefits. It is especially true for citizenship by investment that comes with faster document processing and perfect privacy.
Even if a country’s authorities outlaw multiple citizenship, officials in the other county won’t have any information about the new passports one holds. This is understandable as in most host states citizenship by investment procedures are highly confidential.
That said, some governments promote a dual citizenship concept trying to enhance their country’s image.
Sadly, if you are not careful enough, you can easily lose one passport where dual citizenship is outlawed in any of the 2 states. It is enough for your foreign passport data and/or the fact that you have second citizenship to become public for you to lose all benefits second citizenship comes with. In Ukraine, China, UAE, India, Austria, Singapore, and some other states, dual citizenship is not allowed, so proceeding with caution is a sound idea.
Legislative amendments or foreign policy shifts in your native country or new homeland inspired by e.g., a military flare up may result in a loss of dual citizenship for you. If anything like this happens, you’ll have to choose between the 2 passports and eventually lose the benefits dual citizenship grants to holders thereof. Yet, with citizenship by investment procedures being highly confidential, applicants for second citizenship manage to minimize related risks.
Expert assistance with picking and acquiring citizenship by investment abroad
It is a great idea to obtain second citizenship and a foreign passport due to multiple benefits successful citizenship by investment applicants enjoy. The latter may include freedom to travel, political and enconomic stability, physical safety, freedom to open bank accounts abroad, invest in real estate, and become a part of the new culture. Yet, drawbacks do exist.
It is possible that citizenship by investment comes with more positives than negatives and still these negatives should be considered when selecting the country you plan to acquire second citizenship in. At International Wealth, our seasoned consultants will help you make the right choice in line with your wishes and preferences.
To have your questions as to citizenship by investment, related benefits, and ways to obtain it answered the soonest, you are welcome to contact the International Wealth experts directly. For your convenience, please use the above contact phones or an online chat to your right.
What are the benefits of citizenship by investment?
Citizenship by investment comes with additional opportunities as well as extra rights for the holder. With citizenship by investment in your bag, trips and traveling arrangements will be easier and you will enjoy extra consular protection abroad. You will avoid political turmoil and economic volatility if you move to a new safe homeland. A second passport is a tool that can be used to legally avoid conscription. It will make tax planning, investing, and bank account opening much easier for you.
What are the hidden pitfalls of second citizenship?
Citizenship by investment will cost you upwards of USD 100,000. Second citizenship based on army service comes with inherent risks and it is hard to prove you have kinship ties in the host country, while a sham marriage may bring you to jail. Naturalization is a lengthy process and positive outcomes are not guaranteed in case you choose this option. Oftentimes, second citizenship comes with new obligations, including, inter alia, tax liabilities, military commitments, etc. Passports of certain states may turn you into a terrorist target or prevent their holders from pursuing a career in politics.
Now that I am aware of second citizenship positives and negatives, how can I obtain it the soonest?
The fastest and easiest option to become a dual citizen is to choose a citizenship by investment option. Well-off individuals who can afford it have to wait 1.5 to 6 months only to get a second passport. Please, beware that you are not allowed to apply for citizenship by investment to local officials directly. Citizenship by investment applications are to be submitted to a licensed immigration agent in charge of investment and document issues. For more information and customized price quotations, you are welcome to contact the International Wealth top industry experts. They will be happy to provide you with every detail you may need.