Company going under administration or winding up

rxhxl · Post by **rxhxl** » Thu Jan 18, 2024 7:41 pm

Hi Admins,

I have previously posted in the forum and have received helpful replies. My previous post is locked so I have started this new thread...

I hold a T1 Entrepreneur visa and am technically due for ILR in April '24, however, the company (which has 3 other directors apart from me and 2 of them are British) is in a bad state financially and we may enter into voluntary administration before April or receive a winding up notice from a creditor.

I want to understand my options and my questions are:

1. If the company goes into administration - is it still technically 'Active' and can I apply for ILR in April?
2. If I choose to switch to another visa category such as T2 SKV - Can I be a director of the existing company on the date of SK visa application? If so, when should I resign?
3. How many months do I have to remain on SKV to qualify for ILR?

Looking forward to your valuable response. Thanks

Post by **alterhase58** » Thu Jan 18, 2024 8:17 pm

Administrator will try to restructure to save the business, or if not possible liquidate the assets.
Not sure you can make plans in this basis. Can’t comment on how this will impact an ILR application.

rxhxl · Post by **rxhxl** » Thu Jan 18, 2024 9:03 pm

Thank you for your prompt response. Can I get a reply on my Skilled work visa switch questions please i.e.

1. Once the company goes into administration / winding up proceeding - when should I resign to switch to Tier 2 visa?
2. How many months do I need to be on a Skilled worker visa to qualify for ILR ? (5 years complete in April)
3. At the time of application of Skill worker visa - can I still be a director of the existing company?

Best wishes

Post by **zimba** » Fri Jan 19, 2024 1:23 am

rxhxl wrote: ↑
Thu Jan 18, 2024 9:03 pm
Thank you for your prompt response. Can I get a reply on my Skilled work visa switch questions please i.e.

1. Once the company goes into administration / winding up proceeding - when should I resign to switch to Tier 2 visa?
2. How many months do I need to be on a Skilled worker visa to qualify for ILR ? (5 years complete in April)
3. At the time of application of Skill worker visa - can I still be a director of the existing company?

Best wishes

1,3. As long as you are not on the payroll and no longer working for the business then, you should be ok. The company is winding down so it should not be an issue. during a switch
2. At least a month working for the sponsor is needed

Post by **marcnath** » Sat Feb 03, 2024 12:49 pm

rxhxl wrote: ↑
Thu Jan 18, 2024 7:41 pm
Hi Admins,

I have previously posted in the forum and have received helpful replies. My previous post is locked so I have started this new thread...

I hold a T1 Entrepreneur visa and am technically due for ILR in April '24, however, the company (which has 3 other directors apart from me and 2 of them are British) is in a bad state financially and we may enter into voluntary administration before April or receive a winding up notice from a creditor.

I want to understand my options and my questions are:

1. If the company goes into administration - is it still technically 'Active' and can I apply for ILR in April?
2. If I choose to switch to another visa category such as T2 SKV - Can I be a director of the existing company on the date of SK visa application? If so, when should I resign?
3. How many months do I have to remain on SKV to qualify for ILR?

Looking forward to your valuable response. Thanks

As long as it is not moved to Dissolved it should be considered active. But you can also register yourself as self employed which is sufficient to meet the requirement.

Post by **Frontier Mole** » Fri Feb 09, 2024 4:03 pm

If the business goes into administration then by default it is not managed or owned by the shareholders / directors. The administrators will / should inform the Home Office - if they are aware of the business being conducted under the Entrepreneur visa. Invariably they don’t.
As part of the routine checks for extension or ILR the Company House records are checked. So administration or other insolvency actions will be recorded.
Other issues, on administration or insolvency the records of the business transfer to the third party. The directors lose all control and will not have access to their records. Therefore you can’t rely on anything the business would provide for ILR. Your tax affairs will also need to brought up to date and paid, this will be another problem if the business goes under.

Moving to SWV - that might not step you away from the issues above, particularly your tax liabilities.

rxhxl · Post by **rxhxl** » Tue Feb 13, 2024 12:34 am

Thanks for the reply, Frontier Mole.

I didn't follow the below

Your tax affairs will also need to brought up to date and paid, this will be another problem if the business goes under.

Moving to SWV - might not step you away from the issues above, particularly your tax liabilities.

My tax affairs are different from the company's as both are separate legal entities. However, do you mean if I move on to SWV, then I will not be able to apply for ILR if the company I used as a vehicle under T1 Entrepreneur visa is under administration?

I apologize I didn't catch your message and it seemed like it was suggested that the company going under will hinder my ILR through a different route (suitability?).

rxhxl · Post by **rxhxl** » Tue Feb 13, 2024 3:54 pm

Can any moderator please reply on my post above. Thank you

Post by **marcnath** » Tue Feb 13, 2024 4:06 pm

I don't see anything that @frontier mole said that indicates your ILR will be directly impacted.

What he points out is that when the company is under administration, it may be difficult for the entrepreneur to get documents etc. For example HO may ask for copies of customer contracts as part of their review of your application. If you have lost control of your firm, you may no longer be able to get that.

I would assume HO has the right to check that you were satisfying the Tier 1 E visa conditions, if that period is part of your ILR qualifying time. While the company being in administration is not a direct disqualification, you may have to answer questions as in the above paragraph.

So I believe @frontier mole is just cautioning you about some potential pitfalls that you need to watch out for.

Post by **Frontier Mole** » Tue Feb 13, 2024 4:27 pm

The somewhat poorly worded point I was trying to emphasise. Make sure your personal tax matters are up to date, and that includes any payments of tax due on your behalf from the company.
The potential failure of the company to pay tax due as a result of administration or insolvency MAY have an impact on how they view your personal conduct as a director of the business.
They don’t take kindly to debts owed to the Crown.

rxhxl · Post by **rxhxl** » Sat Feb 17, 2024 6:26 pm

Thanks for your clarification Marcnath and Frontier Mole

I was paid a salary in the form of PAYE from the company (and about 6 months' of my salary are owed). The company has 15 plus employees; though payments to other employees have been made on time, the company owes PAYE and NIC amounts to the HMRC.

From your statement, Frontier Mole - this PAYE and NIC tax debt owed to HMRC for all employees may cause an impact on my ILR through the Skilled worker route? If so, is there any solution? I or other directors are not in the position to cover the HMRC debt...

rxhxl · Post by **rxhxl** » Sat Feb 17, 2024 6:27 pm

We are trying to raise finance and have signed term sheets but like everything, nothing is guaranteed unless money comes in.

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Company going under administration or winding up

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