One partner after ILR can become an employee ?

[marketing786]

Hi

My partner has taken ILR on 10 years long residency
company was paying him directors salary every month

Can I remove him from directorship and employ him full time for employee requirement ?

[zimba]

You mean your entrepreneurial team member ?

[marcnath]

There is no need to remove him from Directorship.

As long as he is on payroll and has his ILR, he should qualify as a settled worker employed by your business.

I don't see any restriction just because he was your team member before or that he possibly owns a significant part of the business.

A grey area is about the remuneration being counted towards investment, but if the business is making enough revenue to cover the salary, it should not be an issue either.

[marketing786]

Question 1

Yes he is my entrepreneur team member

Question 2

But as being a director he was registered as self employed and was submitting his self assessment yearly.

Can a director become an employee of a same business he is he is director with ?

Becoming an employee means I will have to run a PAYE for employee can I do that ?

[marcnath]

Question 1

Yes he is my entrepreneur team member

Question 2

But as being a director he was registered as self employed and was submitting his self assessment yearly.

Can a director become an employee of a same business he is he is director with ?

Becoming an employee means I will have to run a PAYE for employee can I do that ?

Yes, nothing prevents a Director from being on the Payroll.
I am a Director, major shareholder and on the payroll with PAYE.
You said he was paid as a Director before - how was he being paid without PAYE ?

[marketing786]

We were both registered as self employed as this was one of the requirements as being directors so the directors salary was paid on self employed basis instead of using NI number and hourly pay.

As you have mentioned above it means now he can become a full time employee as well as remain as director ? I can pay his NI contributions and taxes when producing payslips

[marcnath]

We were both registered as self employed as this was one of the requirements as being directors so the directors salary was paid on self employed basis instead of using NI number and hourly pay.

As you have mentioned above it means now he can become a full time employee as well as remain as director ? I can pay his NI contributions and taxes when producing payslips

These are not immigration matters anymore, but just for the sake of clarity.
You have either misunderstood or have been given incorrect advice.
Both of you could have been on payroll, even as Directors, from Day 1. And you could have done that on monthly pay - there is no need for it to be hourly pay. In fact, the pay could be different each month if you wanted to.
Even now, both of you can be regular employees with PAYE of your company. For you as a Tier 1, the only restriction is that you can be only on the payroll of a company that you are a Director of (i.e. your own business).
As for NI, you have to pay NI anyway - only question is whether the company pays or you pay the self employed NI.
By the way, it is an area that I am not too familiar with - but check IR35 conditions. There are times, when even as self-employed, the company may have to pay NI. Ask your accountant about that.

[marketing786]

Thanks will discuss it with my accountant and update you once clarified

Again thanks for your help

[marcnath]

Check out https://www.tax.service.gov.uk/check-em ... -tax/setup

[marketing786]

Hi

My accountant is saying that I disagree with what you have suggested the other day.

Accountant:

Your partner can't become an employee through PAYE because he himself is shareholder of the business. I had to employ two full time employees who should be settled workers in U.K.

If I can include my partner as 1 because he got ILR last month and then 1 more but my accountant is saying you cannot do that instead you have to employ both from outside not your partner because he is shareholder of the same business.

[marcnath]

Hi

My accountant is saying that I disagree with what you have suggested the other day.

Accountant:

Your partner can't become an employee through PAYE because he himself is shareholder of the business. I had to employ two full time employees who should be settled workers in U.K.

If I can include my partner as 1 because he got ILR last month and then 1 more but my accountant is saying you cannot do that instead you have to employ both from outside not your partner because he is shareholder of the same business.

Two separate things
1. "Your partner can't become an employee through PAYE because he himself is shareholder of the business" is plain b******t (sorry for the language). I am on PAYE of my own company for 5 years and am the Director of another company which has had its 40% shareholder as a PAYE employee for the past 8 years.
2. " you have to employ both from outside" - I am happy to accept any evidence he can point out in the immigration rules or in the guidelines. I haven't found that.

[marketing786]

Accountant

I do accept that it is 100% allowed for you to be employee as on PAYE and director as well as shareholder.

Here he is accepting you answer as correct.

2) point he is saying when you apply for visa you do comply to create 2 full time jobs for settled workers. Here is finding it difficult to digest that your partner after getting ILR can become one of the employees.

However he is saying that I am finding it a bit gray area for my expertise and suggesting to request a legal advice from a entrepreneur specialist solicitor who can provide pure legal opinion.

Thanks for you help and will for any suggestions made by you

Regards

[marcnath]

2) point he is saying when you apply for visa you do comply to create 2 full time jobs for settled workers. Here is finding it difficult to digest that your partner after getting ILR can become one of the employees.

However he is saying that I am finding it a bit gray area for my expertise and suggesting to request a legal advice from a entrepreneur specialist solicitor who can provide pure legal opinion.

Thanks for you help and will for any suggestions made by you

Regards

I agree it looks odd.
And it is a good advice to get a professional opinion.
I haven't seen anything in the immigration rules that would prevent you from doing that. And CW has to follow the rules - they can't deny points even if the CW may think like your accountant.
If the rules said "Employee should be a settled worker when starting employment", things would have been different - maybe they will change it after your application.

[marketing786]

Indeed
That's a good point though.
I have to look for a good solicitor with entrepreneurs speciality so I can rely on his advice.
Hope for the best