Source of Funds

Source of Funds (SOF) is the documentation demonstrating that the capital used for investment has a clear and legal origin. This is a mandatory requirement in almost all residency by investment and citizenship by investment programmes.

The purpose of SOF is to prevent money laundering and terrorist financing. The vetting authority must be able to trace the flow of funds from the point of income generation to the moment of investment, leaving no unexplained gaps.

Commonly accepted sources of funds include: income from salary and business, profits from real estate sales, dividends, inheritance, or gifted funds with documentation. Each source must be accompanied by evidence such as contracts, bank statements, tax returns, and legal confirmations.

SOF is often accompanied by Proof of Funds (POF), which demonstrates that the applicant actually possesses the funds. The two concepts complement each other and are both necessary.

See the detailed guide on SOF and POF for investors in the article EB-5 source of funds.