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Hi,

I am on HSMP(2 years) +Tier1(3 years) about to apply ILR in March .

Currently I am director of a Limited company ( Only one director.that's me only). I am on basic salary + dividends =40K Nearly.

My doubt is
1) Is it better to Apply ILR as an Employee
2)Is it better to Apply ILR as a Self Employed.
3)If i am showing as a Employee, Will they ask why I am taking Dividends as an employee ?

Under what category you guys suggest me to apply for ILR.

Awaiting for your suggestions.

ILR_UK_ wrote:Hi,

I am on HSMP(2 years) +Tier1(3 years) about to apply ILR in March .

Currently I am director of a Limited company ( Only one director.that's me only). I am on basic salary + dividends =40K Nearly.

My doubt is
1) Is it better to Apply ILR as an Employee
2)Is it better to Apply ILR as a Self Employed.
3)If i am showing as a Employee, Will they ask why I am taking Dividends as an employee ?

Please suggest me under what category you guys what me to apply for ILR.

Awaiting for your suggestions.

1) I would apply as Employee, cause that is what you really are.
Although it is a "self employment" in layman's term; in legal term I think it is salaried employment for ILR purpose (even though you pay yourself dividend from your LTD company), simply because you pay Class 1 NIC.
And your P60s will support the claim.

2) That may confuse case worker even further, and may ask you for document like your registration with HMRC as "self employed", which you won't have as you are not a self employed, but employee of your own LTD co.

3) If your salary is enough to get the sufficient points and you are not Claiming Dividend income for ILR purpose, you can simply say that although I am paying dividend I don't want to claim it.
If you want to claim it though, you will need to provide Dividend Voucher + Personal Bank Statement to support it.

ILR_UK_ wrote:Hi,

I am on HSMP(2 years) +Tier1(3 years) about to apply ILR in March .

Currently I am director of a Limited company ( Only one director.that's me only). I am on basic salary + dividends =40K Nearly.

My doubt is
1) Is it better to Apply ILR as an Employee
2)Is it better to Apply ILR as a Self Employed.
3)If i am showing as a Employee, Will they ask why I am taking Dividends as an employee ?

Under what category you guys suggest me to apply for ILR.

Awaiting for your suggestions.

1. If you are a director of a ltd company, you are not self employed . You are an employee and director of ur company. If u mention the self employed term, they will get confused.
So apply as an employee.
3. It's better to carry an accountant letter(along with personal bank statement and dividend voucher) stating that u r the director and 100% share holder and can withdraw the profits as dividends, however show them the letter only upon requesting if u planning for same day service

Guys, there is a little confusion around this "Employed" / "Self Employed" status ...

In the eyes of HMRC , as a director of limited company you are "Employed" by your limited company ....


But as regarded by the UKBA they generalise this status as "Self Employed" ... also reading some posts of those who have been to PEO and submitted their documents as employed, they were concluded as selfemployed by the CaseWorker and then granted ILR ...

This is pretty contradicting and confusing too ... Moderators/Experts, your thoughts on this please ?

I reckon at the time of my last T1G extension application the FLR form or associated guidance had a note saying people in this situation i.e. working through their own LTD co. and taking a salary and dividend will be treated as Employee. Can't find similar wording now in the SET (O) guidance, but it is still clear to me that if you state "Self Employed" it is wrong.

One can ask his/her accountant to write a letter explaining the difference between Employee and Self Employed and state that you are working as Employee of own LTD co.

Hi UK_ILR,

I'm in the same situation as you....applying for ILR in March and only Director of Ltd Co with 100% share holding. Salary + Dividends just under 40k (37-39k).

What docs will you be using along with your application? Also have you heard of the Biometric registration process which will come in place from 29th Feb which means you will have to book appointment and register for Biometric before you can apply for your ILR?

You have to apply as an employee of your limited company. You must ensure 5 things -
That your accountants-
1) Must give you monthly salary slips and interim dividend vouchers
2) Must also provide you with a letter confirming the figures on those salary slips and dividend vouchers
3) Must also provide you with another letter confirming the date since when you've been operating your limited company, and that
you are employed as a director with your own company and also that you are 100% shareholder and entitled to all the retain profits
from the company revenue
4) That your accountants are registered with FCCA and their membership number shows clearly on their
letter head (or you might have unwanted questions from case workers)

It is a very common case for UK Home office case workers to handle as most contractors in the UK operate their own limited company and are employed as directors within their company

Biometric registration - This is taken care of at the PEO if you are applying in person. You need to register for biometric separately only if you're applying by post (a sincere advise is never apply by post)

This answer is based on actual response of other successful applicants who submitted their ILR application using form SET-0 version 04/2013 and 12/2013

uktraveller.030209 wrote:You have to apply as an employee of your limited company. You must ensure 5 things -
That your accountants-
1) Must give you monthly salary slips and interim dividend vouchers
2) Must also provide you with a letter confirming the figures on those salary slips and dividend vouchers
3) Must also provide you with another letter confirming the date since when you've been operating your limited company, and that
you are employed as a director with your own company and also that you are 100% shareholder and entitled to all the retain profits
from the company revenue
4) That your accountants are registered with FCCA and their membership number shows clearly on their
letter head (or you might have unwanted questions from case workers)

It is a very common case for UK Home office case workers to handle as most contractors in the UK operate their own limited company and are employed as directors within their company

Biometric registration - This is taken care of at the PEO if you are applying in person. You need to register for biometric separately only if you're applying by post (a sincere advise is never apply by post)

This answer is based on actual response of other successful applicants who submitted their ILR application using form SET-0 version 04/2013 and 12/2013

And again, this post is 2 years old!! Many of your replies are to old posts (2010/2012/2013), please check the date of the original post.