Secure Your Family’s Legacy through a Portfolio of Alternative Residences and Citizenships

For decades, it has been accepted best practice to invest in different regions and asset classes, from equities to real estate, to futureproof your portfolio by spreading risk and creating new opportunities to ensure longevity and the greatest value. But what about where you reside? The same principle applies. In an increasingly unpredictable world, affluent individuals are actively diversifying their geographical domicile options and expanding their personal access rights to a range of different jurisdictions through residence and citizenship by investment.

Entrepreneurs and investors recognize that having a diversified portfolio of residences and/or citizenships can add impetus to their wider wealth planning and legacy management strategies to protect against further downside and to create new value and enhance well-being and optionality for the entire family. Visa rules can and do change, as do governments, but citizenship, when legitimately acquired through an established investment migration program, is for life and can usually be passed down to future generations.

A growing number of countries across the globe host residence and citizenship by investment programs in some of the most sought-after locations in terms of business environment, quality of life, and access to top-tier tertiary education institutions and private healthcare. These programs offer a suite of attractive investment options, from government donations to real estate acquisition, to capital transfers, to enterprise start-ups — each providing a pathway to residence or citizenship in exchange for a significant financial contribution.

The only option is optionality

All investment migration programs allow the main applicant to include a spouse, most include the whole family, and some even allow for the inclusion of a wide array of dependents. For instance, the African island of Mauritius’ residence by investment program allows unmarried and dependent natural, step-, or adopted children of any age to be included in the application.

The Mediterranean nations of Cyprus, Greece, Italy, Malta, Portugal, and Spain allow the investor’s parents and in-laws to obtain residence rights as well. The same applies to Mauritius and the Southeast Asian nations of Malaysia and Thailand, as well as the Caribbean islands that offer additional citizenship acquisition.

Others, such as the Antigua and Barbuda and Malta investment migration programs, stretch across four generations and even include the applicant’s grandparents.

A wide range of program options spanning Asia, Europe, and North America allow applicants to include same gender (civil) partners in their applications. These countries include: Australia, Austria, Canada, Cyprus, Greece, Hong Kong, Italy, Latvia, Malta, New Zealand, Portugal, Spain, Switzerland, Thailand, the UK, and the USA.

Those investors who want to ensure that the benefits of their investment are transferred to their descendants may opt to apply for the Dominica, Grenada, or St. Kitts and Nevis citizenship by investment programs, which allow for the transfer of citizenship by descent, as well as all the global mobility, tax, and lifestyle benefits of Caribbean citizenship.

Similarly, Malta’s Citizenship by Naturalisation for Exceptional Services by Direct Investment is often earmarked as a legacy investment that plants seeds today for a better tomorrow thanks to its legislation, which also grants the automatic transfer of Maltese citizenship to future generations.

The great transfer of wealth

It is estimated that over the next 20 years, around USD 68 trillion in wealth generated by the so-called ‘baby boomers’ will be transferred to their Generation X and millennial offspring, motivating many high-net-worth individuals to plan generational wealth transfers more strategically.

Fiscal legislation such as the Foreign Account Tax Compliance Act and the Common Reporting Standard are impacting wealthy families who seek to mitigate their tax burdens legally. By obtaining alternative residence permits or additional citizenships, family principals can ensure that their businesses and capital are aptly structured to this effect.

Other onerous tax considerations that need to be planned for are inheritance and wealth taxes. As a result, established families are opting for alternative residence or additional citizenships in countries that have no wealth or inheritance taxes such as Antigua and Barbuda, Grenada, Luxembourg, New Zealand, Singapore, and St. Kitts and Nevis, as well as Malaysia and Namibia, which both operate a source-based tax system, meaning foreign residents are generally only taxed on the income they generate in the country.

St. Lucia offers a favorable tax regime for individuals, companies, and real estate, with no capital gains, inheritance, or withholding tax. Unlike the USA, St. Lucia does not impose worldwide personal income tax for international non-residents but does levy income tax on those who reside on the island.

The UAE's Residence by Investment offering is currently attracting significant attention from investors across the globe due to its favorable tax regime — with no personal income, capital, net worth, or withholding tax (except for those levied in the domestic banking and oil sectors), and several double-tax treaties in place.

Creating the ultimate portfolio

Henley & Partners recently launched the Henley Ultimate Portfolio Tool to assist investors and their advisors looking to construct a portfolio of complementary alternative residences and citizenships that unlock maximum access to the world while being tailored to each family’s unique requirements.

The interactive tool is based on 33 indicators that are grouped under seven overarching country benefit parameters that are important considerations for wealthy individuals when selecting investment migration programs to include in their portfolios. The interface allows you to compare the country benefits of up to two existing citizenships with those of up to four additional residence and citizenship by investment programs, as well as identify what the minimum investment threshold is and ascertain the maximum number of destinations you can reach visa-free based on the portfolio you select.

Investment migration programs are fundamentally designed to balance risk and opportunity: the acquisition of multiple residences and citizenships generates unique short-term value and long-term yield, enabling investors to transcend the constraints imposed on them by their countries of origin to improve the resilience of their portfolios and ensure physical and financial longevity for generations to come. Having just a plan B is no longer enough. To secure your legacy, you need a plan B, C, and even D — and that is what Henley Ultimate provides.

Individuals should seek independent financial advice to inform any investment decision.