Permanent Residency: What Is It Good For?
If you are a child of the 60’s you may remember the chorus to a song that asked the question containing the words “War – what is it good for?” The answer to that musical question was, “Absolutely Nuthin’!”
However when we ask, “Permanent residency – What is it good for?” we get a very positive answer that it is good and useful for a variety of reason.
What is Permanent Residency?
To understand what permanent residency is good for, please read our Second Citizenship Report. This is available for immediate download in the Members Area for all paid subscribers
On page 15 of the Second Citizenship Report—2015 Edition we find this:
RESIDENCE is something different again. Residence is where you live. However, different countries have different definitions in their national laws. Some people may have multiple residencies in different countries. For our purposes, residence might be seen as a stepping stone to full citizenship through naturalization.
‘Residence’ is also the right to live in a foreign country. You may or may not actually spend time there, but in some countries the fact that you hold a Resident’s ID card (like a Green Card in the US) means that you are officially a resident there.
Why is permanent residency of interest to us?
Residence is of interest to us for two reasons:
You might acquire tax benefits by moving to another country. Americans who move their residence to another country get many tax and privacy advantages (such as the Foreign Earned Income Exemption) over their fellow citizens who stay at home, even if they are still ultimately subject to tax on their worldwide income. Anyone who is not American, can legally opt out of their home country’s tax system simply by changing their residence.
Residency can be a path to citizenship. Most countries allow residents to apply for citizenship after a period of residence. This can vary from about 2-3 years (Dominican Republic and Singapore) up to 25 years (Liechtenstein or Andorra.)
Let’s use permanent residency in Paraguay as an example
Paraguayan residence is a very attractive base for world travelers, particularly Brits and Europeans, Canadians and Aussies, that are seeking to travel the world in search of income while leaving behind their home country taxes. The second passport is really only important for Americans who are taxed on their worldwide income unless they renounce citizenship, or for those from countries like China or Russia who have problems traveling anywhere on their existing passports.
What is involved with applying for permanent residency in Paraguay?
Paraguay welcomes immigrants and offers Permanent Residency from the very beginning. The process takes some weeks to finalize, but only requires physical presence of the client for a few days. (There are exceptions to this if the applicants are from what Paraguay considers “sensitive countries.”)
After perhaps 6-8 weeks you will receive your permanent residency permit and your Paraguayan cédula (National ID card). If you are not in the country to pick these up, your lawyer can pick them up under a power of attorney and courier them to you. (Again, there are exceptions to this if the applicants are from what Paraguay considers “sensitive countries.”)
To some people, the most attractive part of this process is that your residence is classified as ‘Permanent’ from day one.
You don’t have to return to renew it if you don’t want to – ever!
It will never routinely be cancelled, although of course this is not citizenship and there are some provisions in law to cancel it if you are, for example, convicted of a crime.
This document is ideal for perpetual travelers who simply need a piece of paper issued by a government showing that they live somewhere. Different nationalities have different uses for Paraguay Permanent Residence.
What are some uses for the permanent residency from Paraguay?
For example, some western Europeans have to show their home governments a paper from a foreign government when they leave, so as to escape the tax nets in their country of origin.
Chinese citizens like to hold a foreign Permanent Residency because it allows their kids to get into China’s elite schools and universities that are reserved for ‘foreigners.’
Middle Eastern citizens find having residence in a South American country makes it much easier to get visas to travel elsewhere in the world.
Others, attracted by Brazil’s booming economy, see Paraguay as a back door, tax-free alternative to Brazilian immigration that is much more complicated and expensive.
We started with the question, “Permanent residency—what is it good for?” We’ve seen that there are many circumstances where permanent residency is a valid and useful option to have in your Perpetual Traveler toolbox.
We have recently completed the first of two new Q Wealth Reports on Paraguay, which you’ll find in the Members area. Existing members, please log in any time.