Where China’s wealthy are turning for second passports

For some wealthy Chinese, securing a foreign passport is becoming the ultimate trade-off: giving up their Chinese citizenship.

Wealth advisors say a growing number of affluent Chinese are considering renouncing their nationality as Beijing intensifies scrutiny of offshore wealth, with concerns over taxes, geopolitical uncertainty and greater international mobility driving their interest in alternative passports.

China does not recognize dual nationality, meaning Chinese nationals seeking to acquire foreign citizenship must renounce their passports.

“We have had some clients who are willing to give up their Chinese citizenship to hold multiple passports,” said Armand Arton, CEO of immigration migration consultancy Arton Capital, who added that the choice of passports depends on their lifestyle and business needs.

Meanwhile, Ryan Lin, director at Singapore-based legal firm Bayfront Law, said he has seen an increase in wealthy Chinese considering renouncing their nationality since July.

That month, Beijing introduced new measures targeting offshore trusts, with certain incomes and transactions potentially subject to a 20% tax. The changes have prompted some families to reassess how they hold and transfer assets overseas.

Previously, clients would discuss the possibility of giving up their citizenship. Now, more are expressing concrete intentions to do so, Lin told CNBC.

Manish Tibrewal, co-founder of multi-family office Farro Capital, also reported growing interest in foreign passports.

The wealth advisory firm is helping some Chinese families pursue Caribbean citizenship alongside Singapore permanent residency, with the longer-term possibility of obtaining Singapore citizenship, subject to government approval.

Tibrewal said the number of Chinese families actively exploring alternative citizenship options since July far exceeds those who have completed the process last year.

Inquiries from Chinese clients have risen 33% since July, investment migration firm Savory & Partners said, while Global Citizen Solutions reported an increase of nearly 40% compared with the same period last year.

Both firms specialize in investment migration, which helps wealthy individuals obtain foreign residency or citizenship, often through qualifying investments in their destination countries.

Renouncing Chinese citizenship does not automatically erase existing tax liabilities though.

Individuals could remain liable for taxes on historical gains, depending on how their wealth was structured, even after giving up their nationality, but a genuine change in citizenship and residency could affect future obligations, experts said.

For many wealthy Chinese, relinquishing their nationality remains a significant sacrifice, particularly for those whose businesses and fortunes are tied to the mainland.

Lin said those most willing to take that step generally have few remaining business links to China, with much of their wealth and operations already based offshore.

So where are they…