Reviewing Citizenship by Investment and Residence by Investment Plans:

In answering this question, it is important for clients to recognize that storm clouds can form in either their country of birth or in the overseas countries where they have purchased a citizenship and/or residence.

In some home countries there has been a sharp increase in incidents of abrupt arrest and asset seizure. This may happen without the accompanying rule of law protections common elsewhere. In countries where this is occurring, there is also a tendency to use extraordinary techniques. These may include seizing and charging innocent extended family members in order to extract results.

In the overseas countries, there is a marked increase in the ability of tax authorities to identify and seize the international assets of those who might be accused of tax evasion. It is key to remember that in the area of tax, the onus of proof is reversed. The taxpayer needs to overcome a tax authority’s assertion of tax liability. This is an issue that is being frequently overlooked by many purchasers of Citizenship by Investment programs. Many of these individuals did not comply with tax or other obligations that were part of the status they acquired. This may well have been through ignorance of such obligations. They may also have fallen victim to not changing with the times awareness that lax enforcement at the time allowed them to take liberties without suffering adverse consequences. Those days are gone!