Henley
The Swiss Christian Kälin is with his company Henley
Rainer Zitelmann: You say you’ve never had so much to do with arranging residence permits and citizenship. What are the reasons?
Kälin: The Corona crisis was a big accelerator. In some countries, such as Spain and Italy, people were literally put under house arrest, and in almost all of them they were no longer able to travel abroad. This has increased the demand for our service, which we call “mobility consulting”.
Is it primarily tax reasons that play a role for wealthy people when they look for another place of residence?
Kalin: No. This plays a role for some clients, but it is usually not the focus. From a tax point of view, it is increasingly difficult to leave Germany. The “exit taxation” is tantamount to a fiscal wall. Germans who want to leave the country tend to do so because they are dissatisfied with the political situation and are looking for countries where there is more entrepreneurial freedom and security.
Which countries are currently particularly popular with your clients?
Kälin: Great Britain, Switzerland of course, Canada, and more and more Dubai. However, there are also countries that do not immediately come to mind, e.g. Montenegro or countries in the Caribbean.
And how do you get a residence permit or even a passport from one of these countries?
Kälin: There are various ways to do this, but we have specialized in investment programs. In many countries you get a residence permit if you do business there or buy a property. The rule is: the higher the sum you invest, the longer the residence permit. However, there are many different schemes in most countries and our expertise lies in advising clients on which is best for them and helping them apply.
The reform for the new property tax is complex – and this year it will require owners. You have to submit some data to the tax office. You have to be very precise and observe special deadlines. In our large guide you will find all the information you need to know in a compact form.
Do you have to give up German citizenship when applying for a second passport?
Kalin: Not necessarily. If you take on a foreign nationality and wish to retain your German nationality, you must apply for a retention permit. If your application is approved, you will receive a certificate confirming that you are permitted to retain German citizenship (Bebehaltungscertificate).
What happens if you take another citizenship without first applying for the retention certificate?
Kälin: Then you lose your German citizenship. But there are probably tens of thousands of Germans who live abroad with another passport and who also have a German passport – without this certificate of retention. They actually lost their German citizenship, but they don’t know it because the German authorities didn’t notice that they had another passport. We strongly advise against this, it is very risky.
How much does it cost to get a residence permit or passport for another country?
Kälin: That depends, among other things, on how difficult and complex it is. In Dubai it is very easy and can be arranged from as little as 5,000 to 10,000 euros. But if you are a German and want to change your citizenship and become Austrian, for example, you are faced with greater challenges. This is much more complex and takes longer – and therefore costs several 100,000 euros.
And how high do the investments have to be?
Kälin: In the UK, for example, it starts at £250,000. In the US, it’s currently at least $850,000 for passive investing, less if you’re starting a business. But there are also countries where significantly lower sums are required.
I met green card brokers in the US who worked with real estate companies. My impression was that the investors sometimes didn’t look very closely at the quality and sense of the investment because the green card was the main motive.
Kälin: No investor should make this mistake. The investment must make sense in itself, you should check the quality independently of the goal of getting a residence permit.
How long does it take to get a residence permit or even citizenship?
Kälin: In Turkey or Grenada it goes relatively quickly, in the USA, for example, it takes much longer.
In the United States, getting a green card makes you taxable worldwide, even if you don’t live there. This leads to a very high effort for the tax return. Is there something similar in other countries?
Kälin: For the USA, it depends on which visa you apply for. The EB5 visa, which leads to a green card, is as you say, but there is, for example, as an alternative to the green card, the E2 “treaty investor” visa, which is attractive to investors if they do not intend longer living in the US four to six months a year. Also in Canada, a popular country, it is important to note that if you stay there for more than six months, you generally become liable for worldwide tax.
It sounds like it’s all a real “science”.
Kälin: We have been in this business for more than 25 years now and have offices in more than 35 countries. And yet you learn something new every day, because it is becoming more and more complex, there are more and more options worldwide, and the programs in the different countries and the motives of the investors are constantly evolving.
You can learn more about this topic at an event taking place on March 20 in Berlin.
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