Sure, that would help, but what if we threw in visa-free travel and geopolitical diversification into the mix? Obtaining a second citizenship can help with all that. And if it sounds like something that ‘a regular citizen like me’ could never pull off, think again.
Second passports can be obtained by naturalization, investment or descent. And, obviously, there are many considerations and tax planning questions that must be answered beforehand.
For example, do you want to live in the country where you’re getting your second passport? Depending on your answer, your strategy will differ. We’ve got the low-down on the benefits of a second passport as well as the drawbacks – all within
this article.
1. The Concept of a Second Passport
- Citizenship vs Residency
2. The Best Second Passport for US Citizens
3. Why Have a Second Passport?
- Get Unburdened by Visas
- A Better Lifestyle and Improved Quality of Life
- Second Passport for Tax Optimization
- Avoid Political Uncertainty and Diversify Your Governments
- Privacy Considerations
4. How Would You Like to Be a Citizen of the World?
o Decide Where You Are Going to Live First
5. How Do I Apply for a Second Passport?
- A Pre-Application Checklist
- By Way of Ancestry
- By Way of Naturalization
- By Way of Investment
6. Second Passport Myths: Debunked
7. What’s Next? The Importance of a Contingency Plan
1. The Concept of a Second Passport
Before we jump straight into all the benefits that having a second passport brings, we should define the concept itself.
Simply put, a second passport is the travel document you will be able to claim when you acquire another citizenship.
Sounds easy enough, right?
Not all countries in the world even allow having a second passport, so before you proceed, you should check in on that.
That said, citizens of the following countries can hold dual citizenship:
- USA
- UK
- Australia
- New Zealand
This is not a full list, but if you’re from one of these countries, you’re in luck. The governments won’t even flinch if you turn up with two or more passports.
Citizenship vs Residency
Now, we should clear something up. Citizenship and residency aren’t the same thing. You might have heard of countries where you could move to tomorrow and gain temporary and/or permanent residency just like that.
And you can. But doing so wouldn’t qualify you for a personal travel document, such as a passport. They might issue you an identification document to prove you’re a resident somewhere, but that’s certainly not a document you want to try and catch a flight with.
A citizenship, whichever way it comes to you, is a status as a citizen of a country, which entitles you to a passport.
What we’re talking about in this article is citizenship and second passports. And to complicate things a little bit more, here’s another fun little fact: you don’t have to live in the country where your second passport is potentially issued.
2. The Best Second Passport for US Citizens
This is probably a question that’s the most frequently asked among our readers, so we do apologize to our audience from elsewhere.
Let’s start by just saying that according to the Nomad Passport Index, the US passport is ranked 38 th globally in terms of its power. This is mostly due to the global taxation of its citizens.
And when it comes to obtaining a second passport for US citizens, there is no ‘best’ second passport for any one person. It greatly depends on the circumstances of the second passport being sought out.
However, if you ask us, the top 7 best second passports for non-EU citizens are:
- Finland
- Switzerland
- Luxembourg
- Ireland
- Spain
- Malta
- Portugal
Yup, you’ve noticed that right – all of these are EU countries, giving you passport power to the max.
With one, you can travel visa-free to most of the countries of the world, you can access the entire European Union and freely live within all its lands.
Just don’t forget to do your due diligence and ask yourself this:
Are you looking to invest, move somewhere new, reduce your taxes, or do you simply want to expand your travel options?
The best country to get a second passport for an American citizen will depend on your answers to these question.
3. Why Have a Second Passport?
This is what we’re all here for – to talk about the benefits of a second passport.
Or your third, or fourth. There really is no limit as to how many you can get if you can find the right jurisdictions.
We know a guy who has eight!
But let’s not get ahead of yourselves. Here’s why you should have a second passport.
Get Unburdened by Visas
Your passport might be one of the ‘powerful’ ones , or it might not be. In any case, having another passport opens up even more doors than just the one to your new country of citizenship.
Traveling without any restrictions is bliss: imagine no visa processes to track, no fees to pay, no deadlines to meet and no interviews to attend.
Having a second passport means that you’ll likely have more possibilities to travel the world, free as a bird.
For example, say you are an American citizen who’s getting Maltese citizenship. That’s certainly not unheard of.
Having a Maltese citizenship means the entire EU is suddenly open to you to freely travel, live and work in. Amazing!
Lastly, there is the pro of having a second passport when you visit one country that doesn’t play nice with another one.
Say, you visited Israel and then want to go off on a journey to Iran. That won’t be possible with the same passport, but having two will definitely help get you there.
A Better Lifestyle and Improved Quality of Life
We alluded to this point at the very beginning of our article and we’re circling back to revisit it now. We’re strong believers that having a second passport gives you more options.
More options might mean choice paralysis when it comes to picking out a box of cereal or a new TV, but more options via multiple passports is always a great thing. This benefit overlaps with some of the other ones. For example, a decreased tax bill or a fruitful investment might make you happier too.
However, we find it important to tell you exactly how a second passport might give you a more fulfilled life.
Say you’ve admired Spanish architecture for years and have taken Spanish in high school. The food has always intrigued you and you loved your holiday in Barcelona.
What about a little apartment in a Gaudi-esque building in Barcelona for yourself, then? A second passport that you’d obtain in Spain could help.
Sipping your morning coffee on a balcony, overlooking the country of your dreams and social preferences will sure give you a nice boost in overall happiness.
Why not take the plunge? Carpe diem, as they say.
Furthermore, having a second passport could directly impact your family in a positive way. Your spouse could potentially take on career opportunities abroad or your (future) kids could go to school and university in more places than just home and pay ‘home’ fees.
Second Passport for Tax Optimization
As a dual passport holder, you’ll be in a league of your own.
You will be able to brag all about the benefit of optimizing your tax, though remember it works best when it’s well-thought out and planned conspicuously.
Governments worldwide will bend over backwards to tax businesses and residents. The tendency is that they will want more and more, so that they can keep making their policies a reality.
If you’re a wealthy individual earning more than your country’s average income or running a successful business, you will soon start worrying about the parties, the representatives, politics in general, and everything in between.
But what if we told you there was a better way?
Obtaining a second passport in a no- or low-tax country could mean you would automatically decrease your tax burden.
Of course, you’d have to live there to become a resident for tax purposes, but there are various ways to deal with this ‘obstacle.’ There are countries in this world that want incoming capital, so they have low taxes and offer the possibility for foreigners to obtain their citizenship by way of investment.
It’s up to you to seek these countries out and really take advantage of all the legal ways that you can lower your tax burden. That’s what a second passport is for.
And remember, we mentioned low tax countries too. Sometimes, it might be worth paying more – say 10% income tax – to have the political stability, a more favourable location and the like.
In other words, optimizing your tax isn’t a be all end all. Just think about the quality of life factor that we spoke of above!
Avoid Political Uncertainty and Diversify Your Governments
Politics can be a whirlwind: one day, a country might be welcoming to foreigners and their capital. And come next election, all foreigners are thrown out and their money seized.
The good news – that scenario has not panned out anywhere you’ve lived yet, at least not in the recent decades.
Peaceful protests can escalate into armed conflicts, putting the lives of millions at risk. Just look at Hong Kong and Chile in 2019. It seems as if the year has been plagued by civil unrest.
Not only are you risking your personal security by staying put, but your business, career, family and residence are also at risk in situations like that.
That’s when a second passport would come incredibly in handy.
It probably wouldn’t help if you have a passport to a neighbouring country or a country that’s closely tied to the country in turmoil.
Yet, if you’ve diversified your citizenships smartly, you’d do much better.
So, even though you might be living in a country that fully embraces democratic principles, on some occasions, it can mean absolutely nothing.
Privacy Considerations
You don’t have to be part of the rich and famous to want improved privacy in your life. In the age of “social media everything” and governments snooping on their citizens, privacy is a thing that people are willing to pay a premium on.
A second passport can help here too, and it’s not all about creating a ‘new’ life for yourself, one that is devoid of old connections.
No.
It simply means that having a second passport can let you move assets abroad, maybe to a country that doesn’t participate in information sharing.
Imagine the following scenario.
Say you are a Mexican citizen and a tax resident there. As soon as you pass a certain threshold in income, your information becomes publicly available for ‘transparency purposes,’ of course.
While the intention of this law might have been right, the effects of this are not. It means that wealthier people are getting kidnapped (or their family members kidnapped) and blackmailed for ransom all the time.
And nobody’s got time for that! Or the nerve, really.
This person might want to claim a second passport for privacy reasons. Moving most of his assets offshore would take him off the public lists and make him less visible in the eyes of the con artists.
4. How Would You Like to Be a Citizen of the World?
The world is your playground. So why limit yourself to one citizenship?
With all the benefits we’ve discussed that having a second passport gives you, you are probably convinced by now. Holding two (or more) passports is not bias. It’s not a crime, nor is it treason to your homeland.
People always seek out the places where they feel the best – it’s only natural.
So why not hold two citizenships and reap all the benefits that your dual citizenship might offer? We see no reason.
Decide Where You Are Going to Live First
A huge consideration among all this second passport talk should be your desired country of residence.
You should weigh up your concerns now, versus your concerns later.
Will you really want to stay put on a tiny Caribbean island, say St. Kitts and Nevis or The Bahamas, for the next decade just to get a second passport there?
If you’re not retired, the answer is probably not.
The places are tiny and although they have some highly favourable tax regimes, you’d quickly get bored out of your mind.
Obtaining a second passport often hinges on becoming a resident there, so if you’re not willing to make a move (just yet), there will be no dice getting that passport.
For example, Malta is a highly coveted citizenship that opens up doors to the entire EU and more. Yet, the Maltese government, pushed along by the EU itself, demands that people prove genuine links to the country: you must live in Malta for the majority of the year, have property there and a liveable income that you remit to the country too.
If you don’t want to get into all this, then you really must give yourself a genuine answer as to where you want to live now and in the future.
Not willing to relocate? Then keep that in mind when fishing for a second passport.
Tax planning is key.
5. How Do I Apply for a Second Passport?
Have we convinced you that you need a second passport? We hope so, as there are so many benefits.
Now, let’s get to the nitty-gritty – the actual process of obtaining a second passport.
A passport is a document that legitimizes you as a citizen of a country and is issued by a governmental institution, normally within a Ministry of Internal Affairs.
A Pre-Application Checklist
Before you apply and go spending your time and money, make sure you’ve ticked the following boxes:
– Your current place of residency allows for dual citizenship
– The country in which you want to obtain a second passport allows for dual citizenship
(otherwise, you’ll need to renounce your first one and lose the benefit of government
diversification)
– You know exactly what tax implications a second passport will have for yourself, your family
and your business
– You have chosen the method through which you will obtain said passport
And talking about methods, there are three solid ones. Let’s jump right in.
By Way of Ancestry
If you can, you should aim to obtain your second passport by way of ancestry. It has the least tax implications and you normally wouldn’t be required to live in the country to obtain the passport.
For example, the Irish ancestry passport program is well-known and widely used, especially by people with Irish heritage in the United States.
Your reason for obtaining a passport by ancestry might not be as much for tax purposes, but more for quality of life and improved opportunities to travel, work and study (for you and your family).
Irish citizenship through descent means that at least one grandparent or parent must have been Irish-born and resident in the country. It’s a country that’s highly open to handing out passports to long-lost relatives abroad.
This is great news – holding an Irish passport means you’d have access to all of the EU. That’s a big perk!
Similar perks await those with ancestors from Germany, England, France, Italy, Portugal, and many nothers.
So, you should think about your family tree and go as far as great-grandparents. Then look if any of the countries you’ve identified offer to obtain citizenship by way of descent.
You could be pleasantly surprised; there is comparably little paperwork involved and the fees aren’t usually that high for a second passport obtained this way.
There will normally be minimal, if any, language requirements, and the timeline will be rather expedited. You could be a proud owner of a second passport in mere months!
To apply for a passport by ancestry, you will:
– Apply for it at your nearest embassy if you’re not in the country in question
– Alternatively, apply for citizenship at the civil status authority within the territory of the
country
– Provide your apostilled birth certificate
– Provide a personal certificate that shows your civil status
– Apostilled birth certificates of your children, if you have any
– Supply a document that confirms your blood line to your ‘local’ ancestor
– Provide any necessary documents to prove sufficient income to support your residence in
the country (if applicable)
Before you apply, just triple check whether you’re able to fulfil all the necessary criteria. Otherwise,
it’s a very pricey letter that you’ll be paying for – ‘Sorry, but you have been denied.’
By Way of Naturalization
The most common way to get a second passport is by naturalization.
This simply means that you will have to live in a country for a set period of time, have decent language and culture skills, as well as have enough income and prove yourself as a non-threat to the country’s security.
All of this can be achieved if you’re really committed to the country and living abroad.
Let’s say you really like Bulgaria and all that it has to offer. You decide to become a resident there, so you apply for a temporary residency permit at first.
After a specific number of years, you can upgrade it to a permanent residency, but while that means you’ll be treated just like a citizen for tax and social services purposes, you still won’t hold a national ID – a passport.
After another set number of years, you’ll become eligible to apply for citizenship and a passport.
How long the period from your initial arrival to the obtaining of a passport lasts differs wildly depending on the country.
We’d say you could ballpark it at a minimum of 5 years to a maximum of 20.20?!
Well, some Gulf States, which don’t necessarily want you to gain citizenship, have set the bar particularly high.
You could live in a country for 20 years, speak fluent Arabic, pay all your tax there, but still be denied citizenship, based purely on a whim of the Sultan. If you’re serious about obtaining a second passport by way of naturalization, be prepared for a
relatively long and hard slog.
You’ll need to master the language and culture, as there are often exams and/or interviews to test that.
Plus, you’ll need to provide documents to prove you’re not a threat to the country’s security. This could mean proving that your criminal record is clear in your country of origin and it can also mean that you’ve committed no crimes during your time in the host country.
Some countries are more liberal, and others are more conservative when it comes to granting citizenship.
You should check the current requirements – keeping in mind that they can change at any time – and plan your naturalization process accordingly.
And then remember this saying: ubi panis ibi patria – where there is bread, there is my country.
N.B. The naturalization process, albeit expedited, is also used when people marry someone of another nationality and wish to obtain a passport from the country of residence of their spouse.
By Way of Investment
The so called ‘instant citizenship countries’ and ‘buy a passport’ countries are all the rage among people wanting to get a second passport really quickly. And although it’s not exactly equal to buying a passport, we can see why it’s called that.
Obtaining a passport by way of investment requires that you put a certain amount of money into the local economy, be it funds, property or a business, before you’re awarded a second passport. Just like that.
Needless to say, passports are NOT being handed out for $500. You’ll need much more than that, which is why passports by way of investment are only accessible to those with substantial wealth. You can Google around to find the ‘cheapest’ place to buy a passport, and you’ll see sums starting from at least $100,000.
For example, Malta requires an investment of $800,000 per family member. Say you had a spouse and a kid and suddenly, you’re looking at a bill of $2.5 million.
That’s certainly something that very few can afford. Plus, you’d be required to invest in a property in Malta too, which can be rather pricey on a small island.
Some other countries which allow you to obtain a passport by way of investment are Cyprus, St. Kitts Nevis, Dominica, Vanuatu and a few select others too.
As with every investment, there cannot be any guarantees that you will make or get the money back.
So, tread carefully.
Sure, there might be a boost in your quality of life or a tax burden that could shrink, but it all comes at a price.
6. Second Passport Myths: Debunked
Second passports are highly sought after by wealthy businessmen, entrepreneurs, cryptocurrency traders, people looking to protect their assets and more.
So how come there are always cases when these people get caught up doing shady business with snake oil salesmen?
There are many companies, gurus and ‘coaches’ out there who will be really happy to take your money in exchange for a second passport.
However, you should know that there is no ‘best’ passport for any one person, following the official rules and regulations will make sure that you don’t waste unnecessary time and money.
And finally, dealing with a legitimate tax planning business will ensure that your second passport is LEGAL.
You surely don’t want to attempt to travel on a fake passport and then have to explain yourself to the customs people.
Here are three myths that you should watch out for when deciding whether you’d like to go for a second passport.
It will take a long time to get your second passport
Obtaining a second passport doesn’t have to take an eternity.
If you’re thinking of residency programs, which then let you apply for the citizenship in five, ten, or twenty years’ time, then yes.
But nowadays, there are plenty of options for a relatively quick second passport process. It won’t be overnight, but you know what they say: Rome wasn’t built in a day.
All good things are worth waiting for, so just stay put and enjoy the process of obtaining your second passport – for many good reasons.
You’ll be flagged up for audit for having a second citizenship
People are always so fearful of offshore anything that they fail to see how their own government has got them cornered in, afraid to make financial moves.
It’s your money and it’s your life.
We say go for it and get that second citizenship if it makes sense in your life. And rest assured, because you definitely won’t be flagged up for an audit or an inspection just because you’ll have another passport.
Not complying with reporting requirements and such MIGHT, but the government probably has bigger fish to fry than people going off and legally obtaining another citizenship.
You must renounce your current citizenship to claim another passport
As we discussed at length throughout this article, having a second citizenship and passport is
in many of the world’s countries.
And if dual citizenship is not possible, it doesn’t automatically mean that you must renounce your ‘home’ citizenship.
It simply means that if you were born with two or three citizenships, you will get to keep them for the duration of your life.
What no-dual-citizenship countries prohibit is you actively going out there and seeking a second passport.
7. What’s Next? The Importance of a Contingency Plan
You might have read about the stories of UK or Dutch citizens being stripped of their citizenship because they’ve gone and joined ISIS in Syria.
What happens to those people who suddenly find themselves having no passport? Well, they are considered stateless. Just imagine having no document to travel with, identify yourself with at the hospital or just do anything, pretty much.
Having a second passport can help you always have this contingency plan.
And no, we’re definitely not saying you will be going to join ISIS!
With a second passport, you will always have a place to go to where they can’t turn you down, simply because you are a citizen.
If something horrible went down in your country of residency, you could pick up and leave. When it comes to life, you just never know and having a plan B can come in handy. And, as always, we recommend that you hire a lawyer or an advisor to help you navigate through all of this second passport business.
From the application process, to opening bank accounts and whatever else may be required of you as a potential citizen, they will make sure you tick all the necessary boxes to succeed and comply with law.
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