The growing demand for second passports among Family Offices and UHNWI’s is being described as the final pull away from America.
Following COVID-19, Biden’s election and fears of repercussions from the Afghanistan ceasefire, wealthy American’s are looking to the likes of Cyprus, Dominica and Paraguay to plan their great escape out of the US and it is becoming the ultimate status symbol within Family Offices.
For some time, the ultra-wealthy have used citizenship via investment routes to gain access into more tax advantageous countries. From purchasing houses in the Caribbean to depositing thousands in a Panamanian Bank and making donations to Cyprus, UHNWI’s and their families have paid-their way across borders for years and while it might seem extreme, it is quite easily explained.
The Caribbean is one of several offshore jurisdictions to offer a 0% tax rate which when compared to California’s 13% (excluding Federal Tax), is an unquestionable way to save money. On top of the financial savings and tax optimisation, Principals who move to the region can also see a better quality of life, increased freedom of movement and unlock investment opportunities considered otherwise not easily accessible to the Western market.
The golden passport opportunities are not exclusive to offshore jurisdictions either. In the UK, immigrations routes via investments such as the Investor Visa whereby one is expected to invest at least £2,000,000 will help you settle in the UK in 5 years’ time. The time to settle in the UK can be reduced from 5 years to 2 years if the investment is at least £10,000,000. At the end of the end of the applicable settlement time period, permanent residency (indefinite leave to remain) in the UK is granted which, as a long-term investment opportunity, offers the ultimate reward.
Investment is one of four primary ways to gain second citizenship after ancestry, nationalisation and marriage. Unsurprisingly, it’s the easiest and the fastest way to gain entry into a country permanently with each of the other three options requiring three to ten years of commitment to residency, employment or even national service which is the case in Israel as part of its ‘Law of Return Citizenship’.
Paying for your place has become increasingly popular over the last 18 months first with COVID-19 cases rising in the USA. The US election manifesto of taxing the wealthy and the recent US withdrawal of troops in Afghanistan which is causing a global surge of concern. Ultra-wealthy Americans are now weighing up their options and it seems there are seven countries on the green list for Family Offices which include Ireland, Portugal, Paraguay, Armenia, Dominica, Israel and Panama.
Family Offices are placing their bids, where would you place yours?