Portugal’s Golden Residence vs. Spain’s Investor Visa: The Honest Comparison for German Investors 2025

Let me cut straight to an uncomfortable truth:

Most German investors who ask me about Iberian residency programs have unrealistic expectations. They primarily think about low taxes. That’s missing the point.

Why?

Because both Portugal’s Golden Residence and Spain’s Investor Visas are, above all, residency programs—not tax loopholes. In other words: They solve different problems than you might expect.

Over recent years, I’ve advised dozens of clients. And I keep coming across the same misconceptions. That’s why today, I’ll guide you through a reality check of both programs.

No sales hype. No empty promises.

Instead, you’ll get the unvarnished truth about minimum investments, hidden costs, and the true tax realities. Plus: clear advice on which program suits which investor type.

Ready for some straight talk?

Portugal Golden Residence: The Facts Without Sugarcoating

Let’s start with Portugal—because this is where most of the myths circulate.

The Programa de Autorização de Residência para Atividade de Investimento (ARI)—that’s the official name—was fundamentally overhauled in 2023. Many advisors conveniently overlook these changes.

Minimum Investments and Options after the 2023 Reform

Here are the latest minimum investments that actually work:

Most importantly: Direct real estate investments have been suspended since October 2023. Full stop.

If anyone is still pitching you Lisbon or Porto apartments for the Golden Visa, they’re either misinformed or not reputable. Most of my clients now opt for real estate funds.

But beware:

These funds are often structured opaquely. And as an investor, you have significantly less control than with direct property. Budget for annual management fees between 1.5% and 2.5%.

Requirements and Application Process: What No One Tells You

The formal hurdles are manageable. Still, many applications fail on details:

• Clean criminal record: From Germany AND every country you’ve lived in for more than a year
• Health insurance: Must be valid in Portugal—German public insurance isn’t sufficient
• Proof of funds: In addition to the investment sum, at least 50,000 EUR in liquid assets
• Proof of presence: At least 7 days per year physically in Portugal—strictly checked

The application process currently takes 12–18 months. That’s due to staffing shortages at Portugal’s immigration agency SEF. Plan accordingly.

A common pitfall: translations and apostilles. Every German document must be officially translated into Portuguese. Cost: around 3,000–5,000 EUR extra.

Tax Aspects for Germans: The Unfiltered Truth

This is where it gets interesting—and complicated.

Portugal offers the Non-Habitual Resident (NHR) regime. That means up to 20% flat tax on certain income for 10 years. Sounds tempting, right?

The reality:

As a German taxpayer, you remain tax resident in Germany at first. That only changes if you truly emigrate—meaning you give up your German residence and center of life.

On top of that: The double taxation treaty between Germany and Portugal prevents double taxation—but also creates complexity in allocating income.

My honest take?

Portugal’s Golden Visa is mainly a residency program with an option for EU citizenship after five years. The tax advantages only kick in if you actually relocate your center of life.

Spain’s Investor Visa: What You Really Need to Know

Spain makes it more complicated. Why?

Because there isn’t just one investor visa, but several different programs. Each with its own rules, minimum investments, and pitfalls.

Overview of the Different Visa Categories

Let me bring some order to the chaos:

The reality: 95% of my clients go for the Real Estate Investor Visa. Simply because it’s the most transparent option.

But watch out:

Unlike the Portuguese program, you must actually purchase and hold the property. If you sell it before obtaining permanent residence, you lose your status.

Investment Terms in Detail: Hidden Traps

The Spanish Real Estate Investor Visa has pitfalls that even experienced lawyers can overlook:

• Mortgage-free: The 500,000 EUR must be fully equity-financed—no loans allowed
• New properties preferred: Existing properties are allowed, but with new construction, the process is smoother
• No rental initially: For the first two years, you cannot commercially rent out the property
• Regional differences: Madrid and Barcelona have stricter review procedures than other regions

A practical tip from my experience:

Many buy in Valencia or Alicante, where you get better value for money and the authorities are more cooperative than in the major metropolitan areas.

Don’t underestimate the additional costs. Expect to add 10–15% of the purchase price for notary, transfer tax and legal fees.

Legal Framework: What’s Changed in 2024

Spain tightened requirements in 2024—a fact mostly ignored by the German press:

First: Stricter due diligence on source of funds. You must provide a clear paper trail for all invested capital. Combating black money is taken very seriously.

Second: Higher residency requirements. You must enter Spain at least once a year and have this documented.

Third: Stricter health insurance rule. Your policy must offer comprehensive coverage and be recognized in Spain; German international travel insurance is not enough.

The application process is much faster than in Portugal. On average, 4–6 months from application to decision.

Head-to-Head: Portugal vs. Spain for German Investors

Now for the upshot.

After three years of running both programs intensively, I can say: The differences are far greater than most advisors admit.

Comparing Investment Sums: More Than Just Numbers

At first glance, Portugal looks cheaper—500,000 EUR for real estate funds vs. 500,000 EUR for a Spanish property. Is that true?

Not really.

Look closer and you’ll see Portugal incurs higher overall costs:

In other words: Financially, both programs are nearly even.

The key difference?

In Spain, you own real property. In Portugal, you have fund shares, whose value can fluctuate and over which you have no direct control.

Time Commitment and Bureaucracy: An Important Factor

This is where the differences stand out:

Portugal:

• Processing time: 12–18 months
• Minimum stay: 7 days per year
• Renewal: Every 2 years, relatively straightforward
• Permanent residence: Possible after 5 years

Spain:

• Processing time: 4–6 months
• Minimum stay: Must enter at least once per year
• Renewal: Annually in the first years, then every 2 years
• Permanent residence: After 5 years and a language certificate

For busy entrepreneurs, the Spanish system is often more practical. Faster turnaround, lower residence requirements in the early years.

But: the language certificate for permanent residence is not to be underestimated. Level A2 minimum, B1 recommended.

Long-Term Perspectives: EU Citizenship and Exit Strategies

This is the biggest strategic difference:

Portugal offers:

• EU citizenship after 5 years
• Basic Portuguese is enough (A2 level)
• Dual citizenship possible
• No minimum stay required for citizenship

Spain requires:

• EU citizenship only after 10 years
• Advanced knowledge of Spanish (B2 level)
• Dual citizenship only with a few countries
• Proof of integration and regular presence required

For German investors seeking a second EU citizenship for the long-term, Portugal is markedly more attractive.

Tax Implications: What Your Advisor Hasn’t Told You

Now for the heart of the matter.

The majority of tax advisors don’t really understand these programs. Why? Because they mainly know German tax law, but overlook the international aspects.

Double Taxation Treaties: The Key to Understanding

Germany has double tax treaties (DBA) with both countries. These regulate where which income must be taxed.

The basic rule:

As long as you remain a German tax resident, nothing changes for tax purposes. The investor visa alone does not make you a tax resident in Portugal or Spain.

In concrete terms:

• German-source income: Remains taxable in Germany
• International income: Taxed according to German rules
• Investment income: Still subject to German capital gains tax
• Property income: Taxed in the country where the property is located (Portugal/Spain)

Only when you truly move your center of life does the game change.

German Exit Tax: The 10-Million-Euro Trap

This gets really expensive if you’re not careful.

If you leave Germany with a shareholding over 1%, exit tax applies. Meaning: hidden reserves are taxed as if you’d sold everything.

An example from practice:

A client owned GmbH shares with a book value of 500,000 EUR but a market value of 3 million EUR. Moving to Portugal would have triggered a taxable gain of 2.5 million EUR—tax liability approx. 650,000 EUR.

The solution: apply for deferral and smart restructuring before moving away.

But a word of caution with Spain:

Spain is particularly aggressive in auditing high-net-worth newcomers. The so-called Beckham Law can help, but is time-limited and subject to strict conditions.

Optimal Structuring: The Path to Legal Tax Optimization

Here’s the practical part.

If you want to use one of these programs for genuine tax optimization, you need a comprehensive strategy:

1. Timing matters: Ideally relocate at the start of the year for full tax residency in destination country
2. Consider holding structures: Often Cypriot or Maltese holdings are more tax-efficient
3. Property timing: Ideally sell German property after moving
4. Plan liquidity: Ensure enough liquidity for the investment plus living expenses

My advice: Start optimizing your structure at least two years before your planned move. Otherwise, it’ll get expensive or impossible.

My Honest Recommendation: Which Program Fits Whom?

After everything we’ve discussed, let’s tackle the crucial question: Which program is right for you?

The answer depends on your goals. And this is where most advice stays superficial.

Who Should Choose Portugal

The Portuguese Golden Visa suits you if you:

• Value flexibility: Minimal stay requirements (7 days/year)
• Want EU citizenship: Possible after just 5 years
• Don’t want direct property investment: Prefer a fund structure
• Plan tax optimization: NHR system is attractive if you truly leave Germany
• Are comfortable with the language: Portuguese is manageable for Germans

Typical candidate: digital nomad or location-independent entrepreneur who wants security for themselves and their family, without being tied to one place.

A concrete example:

Thomas (38), a software entrepreneur from Munich, already spends six months a year between Bali and Dubai. The Portuguese Golden Visa gives him EU flexibility and a clear path to a second citizenship—without giving up his nomadic lifestyle.

When Spain Makes Sense

The Spanish investor visa is the right choice if you:

• Prefer real property ownership: Direct control over your investment
• Value fast processing: 4–6 months instead of 12–18 in Portugal
• Want to live in Spain part-time: The country and culture appeal to you
• Expect rental income: Commercial renting allowed after two years
• Are not in a hurry for citizenship: 10 years is acceptable to you

Typical candidate: established entrepreneur or investor, sees foreign property as part of their portfolio, willing to spend regular time in Spain.

An example from practice:

Elena (45), a management consultant from Hamburg, buys a villa in Valencia for 600,000 EUR. She uses it herself for six weeks a year, rents it out for the rest, earning 4–5% yield. Plus: EU residency option for her teenage children.

Avoiding Common Mistakes: My Conclusion

To finish, here are the key learnings from three years of intensive consulting:

Mistake #1: Considering programs in isolation
Both Portugal and Spain should be part of a broader strategy. Think at least 10 years ahead.

Mistake #2: Overestimating tax benefits
An investor visa alone doesn’t save taxes. Tax advantages only apply if you truly leave Germany.

Mistake #3: Underestimating additional costs
Plan for 15–20% extra on top of the minimum investment, for supplementary costs, legal fees and ongoing charges.

Mistake #4: Ignoring language requirements
Without a basic grasp of the local language, every long-term perspective becomes tricky.

Mistake #5: Neglecting your exit strategy
What happens when you want out after 5–7 years? Plan your exit from the outset.

My honest recommendation?

Don’t just choose between Portugal and Spain. Choose between “keeping the status quo” and “creating international options.”

Both programs are tools for flexibility, security, and long-term options. But they are not a miracle cure for high German taxes.

If you get that, we can talk about concrete structuring.

Yours, RMS

FAQ: Portugal vs. Spain Investor Programs