Obtaining a European residence permit is an opportunity to move to a country with a high standard of living, progressive medicine, quality education, stable earnings, and a developed economy. European passports permanently occupy high ranks in the rating of strong passports of the world, allowing their owners to move freely around the world. In turn, this allows developing business at the international level, without being tied to visas and permits.
The most frequent request of our agency's clients is to tell about obtaining residence permits in such countries as Germany, France, Italy, Spain, and Portugal. Specialists of our agency in the proposed review analyzed the main points concerning the speed of obtaining a residence permit, taxation, grounds, documents, and even climatic conditions in the country.
Germany
A residence permit in Germany (Aufenthaltstitel) is a permanent permit for citizens from non-EU countries. In the status of a residence permit, a resident can study, work, or run a business. The status is initially requested for a specific purpose. The residence permit is valid for 1 to 2 years and can be extended if the initial requirements are met.
The next step - the status of permanent residence (Niederlassungserlaubnis) is granted to people who have lived in Germany for at least 5 years, worked, and paid taxes. Another option is to obtain the status of "Daueraufenthalt-EU" (long-term residence-EU). With such a document you can move to any EU country on simplified terms.
Just recently, the German government approved a new law on citizenship, according to which you can get citizenship after 5 years of residence, and with special merits after 3 years - it is required to confirm their integration and not depend on social benefits.
Documents for registration of residence permit
To obtain a residence permit, it is necessary to collect and execute the following package of papers:
- resident's passport;
- valid passport and biometric data;
- health insurance policy;
- a certificate confirming the level of German language skills at the A1 level;
- proof of money for the first time (bank statement for six months);
- permission to stay in the country - employment contract, certificate of enrollment, etc.;
- confirmation that the main place of residence is in Germany (personal property or rental agreement).
Price
100-110 € - the cost of registration of a residence permit card, each subsequent renewal will cost 65-80 €.
Speed of registration
The applicant needs to collect the documents, certify, translate, and submit them to the Immigration Office. For the issuance of a residence permit card, it is necessary to wait 4 weeks. The document is made in the form of a plastic card with data about the owner, chip, photo, and fingerprints.
Taxes
A residence permit in Germany does not automatically confer tax residency status. Income tax will begin to accrue if you stay in the country for more than 183 days a year.
The country has developed and implemented a progressive tax rate on earned income. It increases with the increase in income. The maximum rate is 47.5% and is levied on persons whose income exceeds 265,327 €. If a person earns 14,255 € or less per year, no income tax is levied. The tax rate varies not only depending on the income but also on the tax class of the person. There is an opportunity to refund part of the listed tax liabilities by filing a tax return at the end of the reporting period.
The main taxes in Germany are as follows.
Solidarity contribution - is levied on persons whose income is more than 62,127 €. Obligations received are redirected to improve infrastructure, health care, education, and other significant areas/industries.
Social security contributions are among the highest among European countries and are divided into:
- pension insurance (18.6%),
- unemployment insurance (3%),
- nursing insurance (2.5%)
- health insurance (14.6%).
50% is charged to the employer, 50% to the employee.
Property tax - according to local legislation, a tax is levied annually on the owner at a rate of 0.35% of the value of the property. Each region has the right to set its rate and in some places, it exceeds the federal rate by 8 times! When transferring real estate from one owner to another, it is necessary to pay tax in the amount of 3.5%. When investing in real estate, you should not forget about the speculation tax. If the buyer decides to sell the property within 10 years after the purchase at a higher value than was initially paid when buying the object, he must pay tax on the difference of the income received.
Church tax - levied only on persons who are official members of a church whose religion is recognized by the state and receives funding from the local treasury. This tax can also be used as a tax rebate.
VAT is a type of tax obligation that local authorities levy on all goods and services created within the country. Some exceptions are not taxed or a reduced rate is levied on these groups. The basic rate is 19% and the reduced rate is 7%.
Climatic conditions
The country has a temperate climate, with cold damp winters and fairly hot summers. In the northern part of the country, due to the proximity of the sea, the climate is more humid.
France
A French residence permit (La carte de séjour temporaire) is a permit for a foreign resident to reside in France for 1 year or more. A residence permit can be obtained based on a long-term visa (visa long séjour), which allows you to stay in France for a period of 3 to 12 months. A French residence permit can be obtained based on study, employment, as a talented specialist, for business, or as a financially independent person.
The French residence permit allows the holder to study, work, conduct business (except - for FNP), and use medical services. To obtain a passport by naturalization, it is necessary to live in the country for 5 years in the status of residence permit and 5 years in the status of permanent residence. After 10 years, if you meet the residency requirements, you can obtain a passport. The period may be shortened if the applicant receives a residence permit through the Passport to Talent program or has made a significant contribution to the development of French history, culture, or economy. Documents for renewal of residence permit must be submitted at the place of residence, applying to the local prefecture no later than 60 days before the end of the status.
Documents for registration of residence permit
The basic package of documents for obtaining a residence permit includes:
- application form in French;
- resident's passport with an entry permit (national visa D);
- three recent photographs for the documents;
- health insurance policy with coverage of 30,000 € or more;
- a document confirming the lease or purchase of real estate in France;
- receipts for consular fees;
- marriage and children's birth certificates, if necessary;
- proof of solvency of the applicant - bank statement or salary certificate.
Price
Type D visa will cost 99 €, primary residence permit card - 241 €, prolongation of the status - 106 €.
Speed of registration
Obtaining a residence permit in France takes from 2 months. To issue a card you need to submit documents to the prefecture and wait up to 60 days. The document is made in the form of a plastic card with printed data about the owner, chip, photo, and fingerprints.
French tax system
As in many European countries, taxes in France are quite numerous and the rates are high. Not surprisingly, it is tax deductions that account for about 90% of the total income that goes into the state treasury. All taxes can be conditionally divided into three major groups:
- taxes for individuals;
- taxes on real estate;
- taxes for legal entities.
In this review, we will focus on the analysis of taxes for individuals.
Income tax - the rate and amount of income tax will be adjusted depending on several factors: marital status, presence of children, and amount of income. The taxable base is calculated not for each resident separately, but in total for his/her family, so the rate can be reduced in proportion to the number of family members.
A resident pays tax on income received anywhere in the world on a scale from 0% to 45%. An additional 3% is charged on income over 250,000 € per person and over 500,000 € per couple. If the income of a single person exceeds 500,000 € and a couple exceeds 1,000,000 €, the rate is 4%.
For non-residents, the calculation algorithm will be different. They pay income tax earned in France at a rate of 20% on income up to 27,519 € and at a rate of 30% if the amount is higher.
VAT is a tax liability on goods and services created in the territory. The basic rate is 20%. If the sphere of services or goods belongs to a preferential category (education, medicine, etc.), reduced tax rates of 10%, 5.5%, and 2.1% are used.
Inheritance taxation - in this case a progressive scale from 5 to 45% is used, directly depending on the degree of kinship. Married couples and common-law spouses are completely exempt from paying the obligation.
Climatic conditions
The climate of France is rather mild, not without reason there is such an abundance of vineyards, which bear good fruit only under favorable conditions - enough precipitation, high temperatures (but not hot), and plenty of rainfall. The climate is characterized by high humidity, and mild winters and summers.
Italy
If planning to stay in Italy longer than 90 days, a foreign citizen needs to obtain a residence permit. After living 5 years in the status of residence permit, you can get the status of permanent residence. After another 5 years, it is possible to apply for citizenship.
To obtain a residence permit in Italy, it is necessary to have a reason - work for an Italian company, training, opening a representative office, financially independent person, entrepreneurial activity, qualified professionals, etc.
To obtain a residence permit, you must first open a visa category D, which will be similar to the chosen basis. You cannot apply for a residence permit for FNL or employment with a student visa. The visa is valid for a year, from the moment of entry into the country, the resident has 8 days to apply for a residence permit at the local police department.
Documents for applying for a residence permit in Italy
The basic package of documents is as follows:
- application form for a residence permit;
- original and a copy of a passport with an open D visa;
- the basis for issuing a residence permit - a labor contract, a letter from a university, and, in some cases, just a D visa;
- checks on payment of fees;
- a document confirming the absence of a criminal record;
- four photos for documents;
- health insurance policy;
- a document confirming the place of residence in Italy - a contract for renting housing or a deed of purchase and sale of property in the country;
- stamp.
Price
Registration of visa type D will cost 50-116 €, and initial registration of residence permit card from 40 € (depending on the type of residence permit).
Processing speed
Obtaining a residence permit in Italy takes from 3 months. To issue a card you need to send documents by mail to the local police department. The document is made in the form of a plastic card with data about the owner, chip, photo, and fingerprints.
Taxes in Italy
To become a tax resident in Italy, you must live in the country for 183 days a year and register a tax code (Codice fiscale). Without a tax number, it is impossible to buy a car, conduct real estate transactions, open a bank account, or get medical insurance in Italy. Conveniently, the code can be obtained without registration, the candidate only needs to show a passport.
As in other European countries, individuals and legal entities are subject to taxation. Individuals are obliged to pay income tax, which is divided into three subcategories: federal, regional, and municipal. Income tax, which is assessed on an employee's official salary, is paid by the employer.
Federal tax (IRPEF) - is assessed on all income earned by the taxpayer: wage labor, rental income, freelance services, capital gains, and entrepreneurial activity. From income minus medical payments, alimony, scholarships, and education.
Regional tax - income tax, which is set by the regional administration, the rate varies from 1.23% to 3.33%.
Municipal tax - calculated and set by the administration of the municipality, the rate ranges from 0% to 0.9%.
Climate of Italy
The climate of Italy is rather mild, Mediterranean in most of the country. There are about 300 sunny days a year and in winter the thermometer rarely drops below 5°C.
Portugal
Obtaining a residence permit for Portugal is an opportunity for a foreign citizen to legally reside in the country for 1-2 years. The obtained status is allowed to extend, provided that the applicant meets the initial requirements based on which the residence permit was obtained. The following options are available as grounds for obtaining residency - conclusion of an employment contract with a local employer, training, investments, family reunification, registration, and creation of a business project, for financially independent persons.
To obtain the new status, it is possible to request a resident visa at the Portuguese consulate or representative office in the place of residence and, upon arrival in the country, to apply for a residence permit to the Migration Service (SEF - Serviço de Estrangeiros e Fronteiras) within 4 months.
The holder of the residence permit can apply for permanent residence status after 5 years and citizenship after another year. Since Portugal is included in the circle of EU member states, the applicant receives a temporary residence of the European Union, and later an EU passport.
Documents for obtaining a residence permit
The basic set can be supplemented at the request of the receiving party with various certificates and papers, depending on the personal history of the client and the chosen basis:
- fresh color photos for documents (2 pcs);
- resident's passport with a valid visa;
- a document confirming the solvency of the applicant - salary certificate, bank account statement;
- a document confirming the availability of housing in Portugal: long-term rent or purchase;
- SEF permission to check the applicant for criminal records in the country of legalization;
- document confirming the absence of a criminal record in the home country of the resident and the country of permanent residence;
- document confirming registration with the tax authorities;
- health insurance policy.
Price
Resident visa D1 - 90 €. 78 € - state fee, 350 € - obtaining a Portuguese Individual Resident Tax Number (NIF).
Processing speed
After submitting the documents, the average waiting time for a decision on a D1 visa is 60 days. Upon arrival in Portugal, it is necessary to go to the SEF and apply for a residence permit. It takes about 60 days for a decision to be made on a residence card application.
Tax system in Portugal
As in other European countries, you can become a tax resident if you live in Portugal for 183 days a year. Tax residents pay income tax on a progressive scale, while business owners have the option to reduce the effective rate to 5%. Wealth taxation applies only to owners of luxury real estate.
New residents could reduce tax pressure through Non-habitual Resident status. Until 01/01/2024 the status could be obtained once by all new tax residents of the country. Non-habitual Resident status was granted once for 10 years without the right of prolongation. All those who managed to get NHR until the end of 2023, retain the privileges for the next 10 years.
Most of the taxes in the country are federal: income tax, corporate income tax, capital gains, inheritance, and transfer of ownership of the real estate.
Income tax - levied on employees of Portuguese firms, private entrepreneurs, accrued interest from investment placements, taxed rental income, and pensions. A flat rate is used for non-residents. A tax liability is assessed on income earned within the country. Tax residents pay liability on a progressive scale - the rate starts at 14.5% and further depends on the amount of total annual income.
Solidarity contribution - additional deduction for individuals whose income starts from 80,882 € and more. The rate of 2.5-5% depends on the amount of total annual income.
Dividend tax - a flat rate of 25% applies to residents and non-residents of the country. The terms may be changed if a double tax treaty applies to international payments.
Capital Gains Tax - a 28% rate is levied on the sale of shares. If the securities are not traded on the stock exchange, only half of the gain from the sale is subject to taxation.
Social security payments - charged at a rate of 11% and withheld from all employees working for companies in Portugal.
Climate of Portugal
Portugal is famous for its mild subtropical climate with warm winters where the thermometer rarely drops below 10°C and hot summers with an average annual temperature of 27°C.
Spain
Spanish residence permit is a permit that allows legal but temporary residence in the country with the right to work. To obtain the new status it is necessary to obtain a D visa at the consulate of the country of residence. The permanent residence permit is a possibility of long-term residence in the country. The permanent residence permit is issued in 1-10 years after obtaining a residence permit, it all depends on the basis.
The status of the residence permit must be regularly renewed by proving the right of residence. In the status of a residence permit, the owner is issued an ID card, which allows him to get a job, live in the country with his family, register, and run a business. Permanent residence permit is an unchangeable status, it will be necessary only every 5 years to request an update of the document confirming the identity of the owner.
Documents for obtaining a residence permit
To obtain any type of residence permit, there is a basic list:
- resident's passport (original and photocopies);
- a document confirming the absence of a criminal record;
- proof of solvency - bank account statement;
- application form;
- health insurance policy;
- confirmation of the grounds for legalization in the country;
- medical examination, which guarantees that the applicant does not have any diseases dangerous for the society;
receipts for payment of state fees.
All documents and certificates obtained outside of Spain must be translated and legalized in the consulate of the country.
Price
The cost of a residence permit card is 590 € for the main applicant plus 200 € for each additional family member.
Speed of processing
Approval for a D visa takes up to 90 days. After that, it is necessary to collect the passport with the issued permit and enter the territory of Spain within 90 days. Upon arrival, a request must be submitted to the migration service and an ID card must be issued. The timeframe for obtaining a residence permit can be up to 5 months.
Spanish tax system
In Spain, there are two resident statuses: tax residency (tax residency) and immigration (resident for immigration). The former includes persons who have lived in the country for more than 183 days a year, run a business, or are employed in Spain.
Income tax - is calculated on a progressive scale and can vary from 19% to 47%. The minimum rate is taxed on income up to 12,450 €, and the maximum - income over 300,000 €.
Capital Gains Tax - is calculated on a progressive scale and can range from 19% to 26%. The minimum rate is for income up to 6,000 € and the maximum for income over 200,000 €.
Social contributions - the flat rate for employees is 6.35%. Employers are taxed at a rate of 29.9% + there are additional rates for workplace accidents.
Wealth taxation - calculated on a progressive scale and can range from 0.2% to 3.5%. The exact calculation will depend on the region of residence of the resident. There is a tax-free allowance of €700,000 at the state level.
Gift and inheritance tax - the exact rate will depend on a combination of factors and can range from 7.65% to 34%.
Property tax - the exact amount depends on the cadastral value of the object and location:
- rural areas - from 0.3% to 0.9%;
- urban areas - 0.4% to 1.1%.
Climatic conditions
The main part of the country is dominated by the Mediterranean climate with mild winters, long dry summers, and warm autumns.
If you still have questions about the registration of residence permit status in any of the above countries or you need assistance in obtaining residency in a European country and not only, the specialists of the licensed agency GARANT.IN are waiting for you for a consultation. We are ready to help you at any stage or do comprehensive work - from collecting and submitting documents for a visa to renting or buying real estate in the country of your choice.
