Getting Residency in Nicaragua
Updated May 20th, 2023
A guide to getting residency in Nicaragua, updated for 2023. If you are looking at becoming a resident to spend time / live in Nicaragua or as a second residency “Plan B” option, my hope is the information in this article shall be useful.
The usual disclaimer to such articles applies. I am neither an attorney or accountant in the country. Should you desire I can refer you to relevant experts for both of those professional services. You can also check out the consulting page if you need bespoke guidance on these and other related topics.
The Basics
Whether you need and / or want residency in Nicaragua depends on your goals and a number of other factors. The application of residency laws are changing so this article reflects current information at the time of writing and probable future trends.
Do I need to be a resident to invest in the country?
You do not need to be a citizen or resident of the country to buy property in Nicaragua. Foreigners can purchase property, and own businesses operations in the country with the same rights as nationals. Having said that, you can use a qualifying real estate investment to qualify for residency, and it does have benefits.
For a full breakdown on ownership check out the article and the video 14 Things to Know About Buying Property in Nicaragua.
Do you want become a tax resident in Nicaragua?
Nicaragua has a territorial tax system. Meaning that income earned abroad is untaxed as long as it does not enter the country into a corporate bank account. Funds entering personal bank accounts for income earned abroad & online are not taxed by Dirrecion General de Ingresos (DGI), Nicaragua’s version of the IRS.
With the exception of American citizens, most foreign nationals who become non tax residents in their native country are not taxed on their worldwide income. US citizens who meet the requirements for the foreign earned income exclusion would not have to pay tax on the first $120,000 of income per individual, or $240,000 per couple, as of 2023. The use of Panamanian corporations and Nicaraguan residency can be extremely advantageous for many, reducing their total tax rate to 5% or less. Again you can consult with me on this to determine your specific needs, requirements, and use of alternative structures and jurisdictions.
Are you looking for a Nicaraguan residency as a “Plan B”?
Nicaragua has been an attractive place to be since 2020. Like many other tropical low tax places we saw an influx of professionals, remote workers and retirees move to the country. A lack of Covid related lockdowns, quarantines and restrictions on daily life were attractive to large numbers of global citizens. Living here was 99% normal from mid 2020 onwards. With a $30,000 minimum investment is has one of the lowest costs of “Plan B” second residencies for potential applicants.
Are you planning on living continuously in Nicaragua for more than 90 consecutive days on a regular basis?
The Nicaraguan tourist visa is valid for 90 days for citizens of most countries. If you’re only coming down for a few months at a stretch your situation may not require residency. You can also pop into Costa Rica for a quick in-and-out border and and get a new 90 days. There is no minimum time required to be out of the country to get the new 90 day stamp.
Pre-covid lot of people instead chose to leave the country and immediately come back in, getting a new 90 day visa on re-entry. Sometimes doing so for years. This became less attractive during the pandemic as borders closed, extensions on visas become more onerous, and this only works for the Nicaragua - Costa Rica land border.
Nicaragua is part of the CA-4 agreement with EL Salvador, Guatemala and Honduras. As a result, leaving to any of these countries does not provide you with a new stamp. Costa Rica, however, is not part of the CA-4. So even an hour spent in Costa Rica was enough to immediately come back in. This works better in San Juan Del Sur where the majority of my properties are located. It’s not so great for the rest of Nicaragua, given the time and logistics.
So you don’t necessarily need residency here for owning property. But it does have it advantages.
The main factors which will determine your route for residency are:
Your age
Source(s) of income
Capital for investment
Plans for length of time spent in the country each year
Desire to operate a business in the country
The three types of residencies that most people Will Use:
Inversionista / Foreigner Investor
Pensionista / Pensioner
Rentista / Fixed Income
Foreign Investor / Inversionista:
Essentially it’s the only route for individuals under 45, or couples / families where neither spouse is 45 or older
An individual, married couple or family with minor children can apply for residency in Nicaragua with a minimum of $30,000 via a qualified investment under Law 127.
The applicant is required to invest in the country in a manner which creates economic activity. The minimum investment must take the place of tangible assets, in the country, and proved to the relevant government authorities via documentation such as a deed of purchase (Escritura)
This can be done using a qualifying real estate investment that has economic activity and / or an actively managed local operation
Until 2022 it was fairly easy to buy a property, place it in a Sociedad Anonima (S.A.) corporation, and then apply for residency. For those who wan to run a business the S.A. lends itself to certain situations and real estate transaction. Even including a home you lived in and / or rented out on sites like AirBnB.
However that was not the spirit of the Investor Class Residency in Nicaragua. What the government wants to see now is economic activity. So the purchase of something like a hotel could work. Most people looking for investor residency in Nicaragua, however, do not want to own and manage an operation of that nature.
For those under 45 looking for residency via investment contact me and we can chat about options specific to you.
The investor class of residency is subject to approval from the Immigration Ministry and the Ministry of Finance (MIFIC)
There a are a number of current & coming changes to the Investor Residency program
The Ministry of Finance (MIFIC) has become more stringent in it’s analysis of the financial basis for approval
MIFIC wants to see legitimate investment and economic activity. The spirit of the law entails the investment has a positive an economic impact in the country.
The investment, land or business needs a physical location, it cannot just be your home. Unless the property and business operation have a real economic connection, such as land titled to your name, planted with teak, and managed
If the business does not own property, via a corporation for example, it needs a rental agreement
MIFIC wants to see the ramifications of the benefit to the economy, and generation of employment
Two or more employees with contracts are required. I like GreeNica because it’s a hand’s off investment for people, and has an economy of scale. Meaning its team of employees are managed by them, yet also meets the hiring requirement. At the time of writing GreeNica’s monthly maintenance fee for the owners of the lots & plantations are $50 per month / lot
The business neesd a written business plan for five years of operations / the investment, or the entity representing your investment needs to have one. Again Greenica has one investors can come in under, reducing the costs and logistics of application
There are benefits to Investor Class Residency in Nicaragua not available via the other classes. Investors have no minimum time in the country required. Only the six month anniversary renewal dates of the residency (ID) card. Meaning two total days per year are required to be in the country. The only thing to note is they are specifically the six month anniversary dates. For example someone who got their residency on January 1st would need to be in Nicaragua on July 1st and January 1st of each year.
Costs of the Investor Residency:
Initial costs:
$30,000 or more into tangible / demonstrable local investments
Registration expenses and taxes if the purchase was real estate. For a $35,000 investment one would estimate $1500 here
The cost to apply inclusive of attorney and government and fees is $1000-2000 for the first individual, $800-$1200 for a spouse, and $300 - $500 per minor depending on applicant-specific requirements. These costs vary based on attorney and / or residency consultant. For GreeNica they would be on the lower end of that spectrum
For S.A. businesses such as hotels you would require accountants, employees, and annual compliance which would vary by your specific situation
Thus the land & teak investment is the least expensive and most simple option for most people who are just looking for residency via investment in Nicaragua
Fixed Income / Rentista:
The best option for those over 45 but without pension or disability income
Similar to the pensioner, but applicable to income derives from investments. This category is now the best route for those whom they are their spouse are 45 or older but do not draw pension income.
Proof of stable income from a single source totalling $1250 or more per month, plus $150 for each dependant is required. Options for this include income from rental properties, annuities, trusts, fixed long term contracts etc.
This category does require client-specific consultation and planning. Consulting is recommended, along with law firms specializing in residencies. I can provide both.
Expenses: The cost to apply including legal and government fees is $1500 for the first individual, $1200-1200 for a spouse, and $500 per minor dependant
Annual Costs: None excepting actual cost of cedula paid twice a year on those six month anniversary dates for the cards
Pensioner / Pensionista:
The best option for those over 45 with sufficient pension or disability income
Available to people aged 45 and older who can demonstrate pension / disability income. Or military pensioners of any age. The applicant(s) must prove the value of their fixed income. The minimum at time of writing is $1250 per month per individual, plus another $150 if a couple. So $1500 total for retired couples.
Expenses: The cost to apply including legal and government fees is $1500 for the first individual, $1200-1200 for a spouse, and $500 per minor dependant
Annual Costs: None excepting actual cost of cedula paid twice a year on those six month anniversary dates for the cards
Documents Required:
Application form
Original passport with color photocopies
Photographs: Passport size, 4 ½ inches high by 3 ½ wide, on a white background, without glasses, without hat, ears and forehead must be visible
Birth Certificate(s): Notarized & apostille stamped. Or in the case of Canadians authenticated using a different process
Marriage License: For married applicants. Notarized & apostille stamped. Or in the case of Canadians authenticated using a different process
Criminal Record Check: Interpol in Managua can provide this document for $25
Health certificate, issued by the Nicaraguan health authorities.
Category-specific documents:
For Investors all of the documents related to the aforementioned investment
Pension letter for Pensionistas
Proof of investment income for Rentistas
Other documents may required to support your specific application
Document Verification:
If you are from one of the 114 countries of the 1961 Hague convention your documents can receive an apostille, an international certification similar to notarization. (Sorry Canadians, not you! We get to you in a minute.)
To receive an apostille the documents must be from the applicant’s home country must be authenticated by the nearest Nicaraguan Consulate within the issuing country. To get authentication in the United States, documents must be notarized and authenticated by a County Clerk or Secretary of State. See the Association of Departments of State website for information on where in the US you can get the apostille.
Canadians need to have their documents notarized in Canada and then sent to the Nicaraguan Consulate in Washington, D.C. In some cases, documents can also be legalized in the Canadian Consulate in Managua. Check before leaving Canada what documentation can be certified in Nicaragua.
Length of the Process
As of May 2023, the average wait time once the application for residency is submitted is 6-8 months. Another important thing to note is how the applications are processed. If you submit your application and are missing a document, the immigration department will notify you and request the new item.
However, when you re-submit with the new document, your application goes back to the "bottom of the pile" as it were. Meaning potentially months of extra wait time. So it's very important to ensure that you submit all the required documents, with apostille or notary certifications, and translations the first time. This is where a quality investment, advisor and and legal representation are key.
Remember that police and health certificates are time-sensitive. They are only valid for 90 days from the date of issue. Ensure that you have all the other documents in order before applying for the police record check and health certificate. As long as these certificates are valid at the time of submission they will stay valid during the process. Most residencies come with five year terms. They are essentially permanently renewing as long as the underlying investment or income source is retained, such as the investment, pension, annuity, trust fund etc.
Obligations of residency:
You must spend at least half the year in Nicaragua (With the exception of investors, who only are required to be in country on the two specifics days of renewal each six months)
You must respect the law
Renew your cedula every 5 years or when it expires
Renew your residency card on every 6 month anniversary
May not become involved in political activities
Provide proof of investment or pension income, if applicable, to INTUR
Don't get the police check or health check in your home country, they are the last things you get and it’s better to get them in Nicaragua.
Can I apply for this on my own?
The short answer is yes, but it is challenging. Some people with patience and good Spanish skills are able to navigate the labyrinth government process of the immigration office. A vast majority of successful applicants for residency, however, use the services of an structured investment with and agent & legal representation.
Consulting Services:
The majority of what I do in Nicaragua is broker real estate transactions and assist with investment. For clients purchasing property I provide residency guidance as part of my services. I also offer consulting for people considering getting residency in Nicaragua who are not currently investing in property, or those in the initial stages of their process.
If you are looking at buying property and using that for residency contact me any time!
Joel Stott-Jess
Cell / WhatsApp: (+505) 8176 8624
Skype: joelstottjess
Joel Stott-Jess is a New York Times featured agent / broker in San Juan Del Sur.
Originally from Alberta, Canada he has been doing business in Nicaragua since 2014.
An investment consultant, serial entrepreneur, surfer, and outdoor enthusiast he is an expert on the real estate and business markets in Nicaragua. He also operates The Central Investor, a real estate and investment blog focused on the entire Central American region.
Thanks to his lovely Nicaraguan wife, a medical doctor, he is also well informed on health care services in the country.
Oceanfront one third acre lot at Playa Remanso