Each year, high living standards, political stability, relatively low tax rates and picturesque landscapes attract hundreds of wealthy individuals to Switzerland. Though Swiss immigration laws are rather strict and it takes 10 years to get Swiss citizenship, in average every one in five residents of that country is a foreigner.
Not all Swiss people are happy with their government’s immigration policy and request to toughen the rules. However, the investment scheme is still operational and open to foreign investors who want to get residency by investment in Switzerland.
Wealthy foreigners that are prepared to invest in Swiss economy come from all over the world. Unfortunately, the process of obtaining Swiss residency by investment is still surrounded by blunt myths and false information. This article will cover 7 most common misconceptions.
If you apply under Swiss residency by investment program, purchase or long-term rent of a property is only one of the conditions on which you can move to the country. But the principal investment is an annual payment of a lump-sum tax – a fixed amount of tax in Swiss francs that you will have to pay each year to tax authorities of the canton you are moving to, based on an agreement signed with them.
The amount of lump-sum tax can vary significantly across cantons as does the density of population in the Swiss Confederation. There is a rule of thumb that can help you reduce the annual tax sum: the less populated the canton where you are going to be registered is, the less you are going to pay in tax. If, however, you prefer a big city to a little picturesque village, you must be prepared to pay more tax to get Swiss residency.
To give you a rough idea of how much of lump-sum tax you can expect to pay each year to keep your residency status in Switzerland, we are talking about at least 250,000 Swiss francs or around 263,000 US dollars.
We can see how this myth could have appeared. Some people think that money can buy everything while others know about citizenship programs of other counties where, indeed, you can get a passport in return for a significant investment. Switzerland does not offer this opportunity.
Your investment will only buy you Swiss residency. To apply for Swiss citizenship, you must live in the country for at least 10 years. And all these years you must have reasons to be in the country: investment and lump-sum tax payments, marriage to a Swiss national, employment or own business.
Immigration laws in Switzerland do allow to include in your application for Swiss residency by investment your family members, but only a spouse and minor children under 18. All other relatives, no matter how close you are to them or how much they depend on you financially, must make separate applications.
Therefore, Switzerland is not for you if you plan to move with the whole family comprising three generations. However, it does not mean there is no other country you can go to. Malta citizenship by investment program accepts applications for children under 26 and parents over 55 provided they are your financial dependants.
This statement is only partially true because a standard naturalisation process in this Alpine country usually takes at least 10 years. You must live all this time in Switzerland learning the language and making sure you do not break any laws.
Can I become a Swiss national faster?
There are two situations when one can become a Swiss citizen quicker:
This must be the most common myth about Swiss residency by investment, ‘Once I get it, I can live anywhere, I can work and do business in any country in the Schengen Zone.’
Swiss government rightfully assume that if you are wealthy enough to spend a lot of money on residency in their wonderful country, you would want to come and live there with your family. Therefore, they expect you to spend most of the time in Switzerland, at least 183 days.
Besides, Swiss authorities think that if you can pay annual lump-sum tax for your Swiss residency (i.e. an amount is fixed in an agreement between you and local canton authority), there is no need for you to do business or work and thus take away a much needed job on a tiny and highly competitive Swiss market.
Bear in mind that as a Swiss investor you will not be able to work or set up a company either in Switzerland or in any European jurisdiction. Residency means that you must move to and live in the country. However, if you just need a residence status for visa-free travel, have a look at residency by investment programs of other European countries or invest in a Caribbean passport.
Believe it or not, but irrespective of how stringent Swiss immigration laws are and how many applications are refused, there are not that many requirements to applicants for Swiss residency by investment. Yes, they will conduct background checks on you. Yes, you will have to go to a chosen canton, alone or with your immigration adviser, to submit an application. However, there are no language or other special requirements at this stage.
Famous for its banking system, politically neutral and unbelievably stable Swiss Confederation is not so desperate to get foreign investments to the point that even a very affluent investor must comply with a lot of requirements to keep their residency status.
Moreover, Switzerland is one of the most attractive relocation destinations that for many years has been rated highest in the world thanks to high quality of life and wellbeing of the population. It is an excellent solution if you are looking for a great place to live where you can give your kids an excellent education.
To avoid mistakes and pitfalls when applying for Swiss residency by investment, we recommend consulting experienced immigration advisers. Our experts at Imperial & Legal will help you get resident status in Switzerland in as short time as possible and provide full support in all immigration and other relocation matters such as opening a bank account, property search and tax planning.
We will work with you to find a customised solution for your immigration, second citizenship, business, tax and other needs.
Second passport by investment
Residence by investment
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