Tier 1 Entrepreneur Extension Switching Companies

[raval2013]

Dear All,

I need to apply for an extension in Sep 2016.

Mar 2013 - Applied for Tier 1 Ent. TEAM visa under "ABC Ltd" 50% share holder and director
July 2013 - Got rejection with no right to appeal due to valid visa
Sep 2013 - Made Fresh Application as SINGLE Applicant "XYZ Ltd" & in Oct 2013 - Got Visa

As I was already trading through ABC ltd since Mar 2013, I did not switch my business activities to XYZ Ltd until Dec 2014. Under ABC ltd (with 50% ownership) I and my old partner provided bookkeeping services and in Dec 2014 I thought to make an investment by my own.

In Nov 2014 I opened up a business bank account for XYZ LTD and transferred £50.5k to acquire an accountancy practice. Since Dec 2014 under XYZ Ltd - I have two full time British Employment, plenty of clients and VAT registered business.

Q1 - Is that a problem if I have not kept £50k in my personal account until I invested? (major investment £50k was made after 14 months since I got my visa)
Q2 - Is that a problem if I did not start trading through XYZ Ltd until Dec 2014? I was running the same business but under ABC Ltd with 50% ownership and directorship.
Q3 - Should I apply for visa in July 2016 so that I will get enough time to re-apply (in case something goes wrong and they reject) ?

Your precious comments and advice are most appreciated.

Thank you very much and good luck to all applicants.

Rajiv

[zimba]

Q1 - Is that a problem if I have not kept £50k in my personal account until I invested? (major investment £50k was made after 14 months since I got my visa)
Q2 - Is that a problem if I did not start trading through XYZ Ltd until Dec 2014? I was running the same business but under ABC Ltd with 50% ownership and directorship.
Q3 - Should I apply for visa in July 2016 so that I will get enough time to re-apply (in case something goes wrong and they reject) ?

First of all, how did your first visa was rejected due to valid visa ???

1. Where was the money then if it was not in your personal account ??? As far as the immigration rules go, you must invest the money within the 3 years initial period.

2. You are allowed to move on to another business as an entrepreneur. You are not forced to stay with the company you started as long as you were registered as a director or self-employed within the 6 months of being granted the initial visa (because you will not be able to extend anyway).
You can even choose to switch to self-employed instead of being a director.

3. You could apply quite early but you risk of not having enough days to cover 5 years for your ILR in future. You are allowed to apply ONLY up to 28 days before the end of your 5 years qualifying period, otherwise your ILR application will be refused.
The guide clearly says:

If you are in the UK we encourage you to apply at least a month before your existing leave expires. If you apply much earlier than this you risk having a shortfall in leave if you choose to apply for settlement. This is because any further grant of leave is given from the date that we make the decision, not the date your leave expires

[raval2013]

Thanks zimba88

First of all, how did your first visa was rejected due to valid visa ???

My initial visa was rejected due to not having £50k in my personal account but partner's personal account and not attaching director's appointment report. I did not have right to appeal due to valid visa so made a fresh application with money in my account and new company & It worked.

1. Where was the money then if it was not in your personal account ??? As far as the immigration rules go, you must invest the money within the 3 years initial period.

I got visa in Oct 2013 then I transferred £50k back to my family because of no investment opportunity until Dec 2014. In Nov 2014 I found an opportunity and invested money.

2. You are allowed to move on to another business as an entrepreneur. You are not forced to stay with the company you started as long as you were registered as a director or self-employed within the 6 months of being granted the initial visa (because you will not be able to extend anyway).
You can even choose to switch to self-employed instead of being a director.

The guideline says " registered a new company in which you are a director, or been registered as a Director of an existing company within the six months AFTER entering the category."

The problem is here because I was a shareholder and director of ABC Limited from Feb 2013 but I got my visa on Oct 2013 & I started trading through ABC Ltd (instead of XYZ, on which I got visa). So in theory I was trading under 11 months old company instead of new company.

3. You could apply quite early but you risk of not having enough days to cover 5 years for your ILR in future. You are allowed to apply ONLY up to 28 days before the end of your 5 years qualifying period, otherwise your ILR application will be refused.

My 10 years are finishing in May 2018 so I was thinking to apply early. If I apply early then I would get chance to make fresh application (in case I get rejection) and will get enough time to make alternative decisions Like tier 2.

[zimba]

I got visa in Oct 2013 then I transferred £50k back to my family because of no investment opportunity until Dec 2014. In Nov 2014 I found an opportunity and invested money.

According to the rules, you must have access to the initial funds until they are invested in the business otherwise they are allowed to curtail your leave.
You never know but the HO might ask you to demonstrate this during your extension if they see you invested after 14 months

The guideline says " registered a new company in which you are a director, or been registered as a Director of an existing company within the six months AFTER entering the category."
The problem is here because I was a shareholder and director of ABC Limited from Feb 2013 but I got my visa on Oct 2013 & I started trading through ABC Ltd (instead of XYZ, on which I got visa). So in theory I was trading under 11 months old company instead of new company.

As long as your previous leave allowed you to become a director you are fine (e.g you were on PSW or tier 1 General). You can be a director of a business even before applying for Tier 1E and continue after grant of the visa. You have been a director in the first six months and that is what it counts. I personally know a case in which the applicant became a director on PSW and applied for Tier 1E afterwards. He even got his extension based on the directorship he held well before his initial Tier 1E grant.

My 10 years are finishing in May 2018 so I was thinking to apply early. If I apply early then I would get chance to make fresh application (in case I get rejection) and will get enough time to make alternative decisions Like tier 2.

It is up to you to make that decision, particularly if you prefer to apply for ILR under 10 year route.

[raval2013]

According to the rules, you must have access to the initial funds until they are invested in the business otherwise they are allowed to curtail your leave.
You never know but the HO might ask you to demonstrate this during your extension if they see you invested after 14 months

Thanks Zimba

You are spot on, my solicitor nailed me down with the same issue. Initially I though they just wanted to scare me with this £50k balance maintenance issue but now I see your point. I am not sure why it is not mentioned in guideline that I have to maintain £50k until I invest. Basically I invested around £2500 in ABC Ltd since/before I got my visa but big investment was made after 14 months

[zimba]

According to the rules, you must have access to the initial funds until they are invested in the business otherwise they are allowed to curtail your leave.
You never know but the HO might ask you to demonstrate this during your extension if they see you invested after 14 months

Thanks Zimba

You are spot on, my solicitor nailed me down with the same issue. Initially I though they just wanted to scare me with this £50k balance maintenance issue but now I see your point. I am not sure why it is not mentioned in guideline that I have to maintain £50k until I invest. Basically I invested around £2500 in ABC Ltd since/before I got my visa but big investment was made after 14 months

Well I hope they don't choose to check it, so you might get away with it. You'll never know until you apply

[raval2013]

As per UKBA guideline 48 "Access to Fund"

1 "In my own possession": Although I did not have £50k into my account for 12 months, I can represent a loan agreement where £50k lent to third party which I received back in 12 months with interest. I guess it would show my possession.

2 ‘invested’ or ‘spent’ by your business’ excludes spending on : buying the business from a previous owner, where the money ultimately goes to that previous owner (irrespective of whether it is received or held directly or indirectly by that previous owner) rather than into the business you have bought. This applies regardless of whether the money is channelled through the business en route to the previous owner. For example, by means of you or your business purchasing ‘goodwill’ or other assets which were previously part of the business
you have bought

I HAVE INVESTED IN THIS MANNER - where I bought 100% shares of an accountancy practice for £50k. Obviously In return I received business with brand name "goodwill". Is it allowed?

[zimba]

As per UKBA guideline 48 "Access to Fund"
1 "In my own possession": Although I did not have £50k into my account for 12 months, I can represent a loan agreement where £50k lent to third party which I received back in 12 months with interest. I guess it would show my possession.

Lending your money to someone else usually means that you lose access to it until it is paid back. For example the borrower could refuse to pay back your loan or can declare bankruptcy in which case you never get your money back.
To be honest, this goes beyond immigration rules and must be discussed if HO challenged you on it.

2 ‘invested’ or ‘spent’ by your business’ excludes spending on : buying the business from a previous owner, where the money ultimately goes to that previous owner (irrespective of whether it is received or held directly or indirectly by that previous owner) rather than into the business you have bought. This applies regardless of whether the money is channelled through the business en route to the previous owner. For example, by means of you or your business purchasing ‘goodwill’ or other assets which were previously part of the business
you have bought

I HAVE INVESTED IN THIS MANNER - where I bought 100% shares of an accountancy practice for £50k. Obviously In return I received business with brand name "goodwill". Is it allowed?

No it is NOT allowed. Obviously when you buy a business from a previous owner, the money goes to his pocket rather than to the business. Therefore this form of investment it is not considered for the award of points under Tier 1E.

[raval2013]

Hello ,

I have gone throw all the options and and it looks like UKBA will defiantly question my investment (buying goodwill). I am thinking of below options, any advice would be much appreciated.

1.Switching tier 1 ent to tier 2 - As per tier 2 guideline it is allowed, but can UKBA stop me changing to this category?

2.Tier 1 ent. to dependent on wife - my wife is currently dependent on me who wants to study further masters for which she needs to go to india to apply for student visa Tier 4. Can I switch to dependent once she gets tier 4 visa?

[noajthan]

Dear All,

I need to apply for an extension in Sep 2016.

...

Your precious comments and advice are most appreciated.

Thank you very much and good luck to all applicants.

Rajiv

Have you (not any advisers you may have) had time to go through the basic guidance?

There are a number of flaws here; it seems you have not reviewed or taken on board the fundamentals.
You do not appear to have bought into the fundamental purpose of such a visa & appear to have made yourself a candidate for curtailment.

50. We may request further evidence or verify that the money will remain available and we will refuse your application if this evidence is not provided or if we cannot satisfactorily verify it. If your application is refused on other grounds we may not carry out the genuine entrepreneur test assessment, but if we reconsider the decision we may do the assessment then.

51. If you already have leave as a Tier 1 (Entrepreneur) migrant we may curtail your leave if the funds you have used to apply cease to be available to you (unless you have spent them in the establishment or running of your business or businesses).

‘Invested’ or ‘Spent’ excludes spending on your own remuneration

Ref https://www.gov.uk/government/uploads/s ... 1_2015.pdf

[seasky]

Dear All,

I need to apply for an extension in Sep 2016.

...

Your precious comments and advice are most appreciated.

Thank you very much and good luck to all applicants.

Rajiv

Have you (not any advisers you may have) had time to go through the basic guidance?

There are a number of flaws here; it seems you have not reviewed or taken on board the fundamentals.
You do not appear to have bought into the fundamental purpose of such a visa & appear to have made yourself a candidate for curtailment.

50. We may request further evidence or verify that the money will remain available and we will refuse your application if this evidence is not provided or if we cannot satisfactorily verify it. If your application is refused on other grounds we may not carry out the genuine entrepreneur test assessment, but if we reconsider the decision we may do the assessment then.

51. If you already have leave as a Tier 1 (Entrepreneur) migrant we may curtail your leave if the funds you have used to apply cease to be available to you (unless you have spent them in the establishment or running of your business or businesses).

‘Invested’ or ‘Spent’ excludes spending on your own remuneration

Ref https://www.gov.uk/government/uploads/s ... 1_2015.pdf

I am confused. I extended my visa and not based on the company that I originally submitted original application for. Since I clearly invested £200K (much more actually) in company B I did not show any evidence in company A. I clearly rememeber that they understand the nature of entrepreneurship is there will be changes of companies (in my case a 'pivot'). He ultimatly invested the £50K and hired to employees etc why wouldn't they extend the visa?

[noajthan]

I am confused. I extended my visa and not based on the company that I originally submitted original application for. Since I clearly invested £200K (much more actually) in company B I did not show any evidence in company A. I clearly rememeber that they understand the nature of entrepreneurship is there will be changes of companies (in my case a 'pivot'). He ultimatly invested the £50K and hired to employees etc why wouldn't they extend the visa?

OP has clearly explained how he put his stake in then took it out again.
And his 'investment' was paid over to someone for goodwill.

Both factors are contrary to the guidance as even OP's advisor seems to have highlighted.

[raval2013]

Have you (not any advisers you may have) had time to go through the basic guidance?

There are a number of flaws here; it seems you have not reviewed or taken on board the fundamentals.
You do not appear to have bought into the fundamental purpose of such a visa & appear to have made yourself a candidate for curtailment.

Ref https://www.gov.uk/government/uploads/s ... 1_2015.pdf

Dear Noajthan,

You are correct my advisory knew what I was doing but he was stupid same as I. I only find one problem with my file - INVESTMENT, which was not clarified in the guideline in oct 2013. It only clarified in 2015 that I cannot buy an existing business and show that as an investment. I still have time to amend that error but due to the nature of my business there is no way that can invest £50k to buy any assets.

[raval2013]

By respect to all of your comments I did some research and tried to figure out how to invest in UK

I am a professional accountant and my business is expanding with clients. Buying an office will cost me huge and doesn't make sense. Hiring an office and and buying desks, chairs and computers will not cost me more then £5000. How about rest of the £45k, can I keep this in business account and show UKBA that I am still willing to invest the rest if any opportunities arise?

My company is making profit, so I can not show that I have lent money to my company to covers the costs which is not covered by revenue (in case of loss making company).

Big question, any idea would be helpful.

[raval2013]

Hello all,

I am bit confused with immigration rule 319C(h). I am not sure if it does applies to me?

I am currently holding tier 1 entrepreneur visa and my wife (who is in uk dependent on me) is planning to study. My visa is valid till Oct 2016 and I am not planning to extend my visa due to lack of investment opportunities.

My wife wants to do MBS in uk so she will apply for tier 4 student visa from India and we would prefer to live with together so I will apply for dependent visa.

Do I also need to apply my PBS dependent visa from India or I can switch from tier 1 ent. to dependent of tier 4 general with in UK?

Many thanks for your advise.
Rajiv