- August 18, 2020
- Posted by: Editor
- Category: Law
Residency in Czech Republic can be obtained as long as certain legal requirements are met. One of them refers to the physical address where the person resides. Although there isn’t any current program that allows foreigners to obtain residency simply by purchasing a property in this country, as it is the case of other European countries, this option can be available in the case of those investing in this country, but other financial requirements must be met.
Besides the investment in the real estate property, additional steps have to be concluded, which can be presented by our immigration lawyer in Czech Republic. It is important to know that residency in Czech Republic is issued as long as a person, regardless of his or her nationality, has a residential address in this country, which means that, upon their arrival, the foreigner must make the necessary arrangements in order to rent a property here.
It is worth knowing that those moving to Czech Republic must make the proof of their residential address in this country when they apply for a residence permit, regardless of its type (temporary, Czech long-term residence permit or permanent residence permit), this being one of the basic requirements necessary when one applies for an immigration document with the Ministry of Interior. Having a permanent residency here allows a foreigner to apply for the Czech citizenship as well.
How can one acquire residency through investments in Czech Republic?
As presented at the beginning of the article, a person can obtain the Czech residency when investing in this country. The advantage provided by this program is that the documents can be obtained in a period of 30-45 days and if the foreigner has a family, the document will be extended to the family members as well. This type of program is seen as a golden visa, as the minimum investment is rather large.
We also mention that the procedure can be completed without the need for the foreigner to be present in this country during the formalities and in this case, our immigration lawyer in Czech Republic can easily represent foreigners throughout all the processes involved in obtaining the residency or the Czech citizenship.
In this particular case, the foreigners, who must be foreign businessmen, should comply with the following basic requirements: they must invest at least CZK 75 million (or EUR 2,850,000) in the local economy, this being the investment threshold that can take the form of various types of assets. From this sum, up to 60% can be invested as real estate properties, physical equipment or know-know.
At the same time, the foreign businessman must be able to create, through his investment or business, at least 20 jobs offered to EU citizens, which must be maintained for the duration of the person’s residency in Czech Republic. Along with the application form, the investor must present a clear business plan.
What should a foreigner know when purchasing a Czech property?
Foreigners are allowed to purchase properties in Czech Republic and this applies to foreigners from outside the European Union (EU) as well, but the legal procedures applicable to each category of nationals can vary. For example, EU citizens do not need to comply with any particular regulations. They can easily move here and make the proof of residence at a physical address in Czech Republic, after which they can start search for a suitable home.
Although not a member of the EU or the European Economic Area (EEA), the United States of America (USA) nationals can also acquire properties in this country, under the regulations of an investment protocol signed by the Czech and American authorities. Those moving to Czech Republic should know that, when purchasing a property, the following transaction costs will apply:
• the legal fees related to the transaction are to be paid by the buyer (accounting for 1% from the value of the property);
• properties are charged with the value added tax, which, in Czech Republic, is imposed at a rate of 21%;
• the buyer is also required to pay the registration fees (charged at 0.01%-0.02%);
• the agent’s fee is also a fee payable by the buyer, and it varies from 2.5% to 5%;
• upon the sale of a property, the seller has to pay the real estate acquisition tax, charged at a rate of 4%.
Starting with 2011, under the Amendment No. 206/2011, foreigners are allowed to own properties in this country, regardless if they obtained a short-term or a Czech long term residence permit that is issued in this country. It must be noted that the definition of a property takes into consideration both residential real estate and private land. Considering that the procedure for acquiring a property here is more complex, we invite those moving to Czech Republic to request information or legal representation from our lawyer.