Dormant vs Liquidation for Tier 1 to Tier 4 Switch

[emperor.uk2009]

Hi, Thanks for your effort on this forum which is amazing.

As my Tier 1 (Entrepreneur) Visa is going to finish within next few month and as I couldn't generate enough income to recruit two full time staff although I'm a genuine entrepreneur and work on few award winning engineering design projects which some has been launched and show cased in design competitions and shows and some still in conceptual level, I'm looking for an alternative way to extend my UK resident permit for additional year before applying for 10yr ILR.

Can you please do me a favour and let me know whether I can
1. Switch to Tier 4 General Student Visa within UK or not?
2. Switch to Tier 2 (Sponsorship) within UK? If yes, would I be questioned about my Tier 1 Ent Progress...?

Thanks in advance for your time and attention
Kind regards

[marcnath]

Hi, Thanks for your effort on this forum which is amazing.

As my Tier 1 (Entrepreneur) Visa is going to finish within next few month and as I couldn't generate enough income to recruit two full time staff although I'm a genuine entrepreneur and work on few award winning engineering design projects which some has been launched and show cased in design competitions and shows and some still in conceptual level, I'm looking for an alternative way to extend my UK resident permit for additional year before applying for 10yr ILR.

Can you please do me a favour and let me know whether I can
1. Switch to Tier 4 General Student Visa within UK or not?
2. Switch to Tier 2 (Sponsorship) within UK? If yes, would I be questioned about my Tier 1 Ent Progress...?

Thanks in advance for your time and attention
Kind regards

Sorry to hear that.
Why did you not use your investment money to hire staff ?
You can't switch to Tier 4 from within the country but you can switch to Tier 2 if you have a sponsor and meet the other conditions.
During any Visa application, HO may check whether you have violated any conditions of previous Visa(s). It is not the same as progress on T1, but more whether you have kept to the conditions of the T1 visa such as not taking other employment.

[zimba]

You also can leave the UK before visa expiry and come back with a new visa within 180 days without breaking your continuous stay.

[emperor.uk2009]

Sorry to hear that.
Why did you not use your investment money to hire staff ?
You can't switch to Tier 4 from within the country but you can switch to Tier 2 if you have a sponsor and meet the other conditions.
During any Visa application, HO may check whether you have violated any conditions of previous Visa(s). It is not the same as progress on T1, but more whether you have kept to the conditions of the T1 visa such as not taking other employment.

Thank you marcnath for your prompt response. I tried several times to use the investment for hiring people but I wasn't confident enough to generate profit as the product my designed award-winning product was new in industry.
Thanks for your informative response.. I haven't violated any rules, except I couldn't recruit two staff which is not a violation but does not meet the Tier 1 Extension criteria.

- I remember my solicitor told me that I can switch to Tier 4 within country few month ago, however, as you mentioned, it seems it' only possible from outside the country. Am I right?

- Do you know that I need to close down my company before applying to Tier 4 as it seems I can not be a director or shareholder to apply for Tier 4? Does the liquidation make any problem for my ILR application?

Thanks in advance

[marcnath]

Sorry to hear that.
Why did you not use your investment money to hire staff ?
You can't switch to Tier 4 from within the country but you can switch to Tier 2 if you have a sponsor and meet the other conditions.
During any Visa application, HO may check whether you have violated any conditions of previous Visa(s). It is not the same as progress on T1, but more whether you have kept to the conditions of the T1 visa such as not taking other employment.

Thank you marcnath for your prompt response. I tried several times to use the investment for hiring people but I wasn't confident enough to generate profit as the product my designed award-winning product was new in industry.
Thanks for your informative response.. I haven't violated any rules, except I couldn't recruit two staff which is not a violation but does not meet the Tier 1 Extension criteria.

- I remember my solicitor told me that I can switch to Tier 4 within country few month ago, however, as you mentioned, it seems it' only possible from outside the country. Am I right?

- Do you know that I need to close down my company before applying to Tier 4 as it seems I can not be a director or shareholder to apply for Tier 4? Does the liquidation make any problem for my ILR application?

Thanks in advance

You can't switch from T1 to T4 from within the country.

You don't have to shut down your company. I am not aware of any such restriction. You can't be employed and work for the company, but a Director appointment is not employment.

[emperor.uk2009]

Sorry to hear that.
Why did you not use your investment money to hire staff ?
You can't switch to Tier 4 from within the country but you can switch to Tier 2 if you have a sponsor and meet the other conditions.
During any Visa application, HO may check whether you have violated any conditions of previous Visa(s). It is not the same as progress on T1, but more whether you have kept to the conditions of the T1 visa such as not taking other employment.

Thank you marcnath for your prompt response. I tried several times to use the investment for hiring people but I wasn't confident enough to generate profit as the product my designed award-winning product was new in industry.
Thanks for your informative response.. I haven't violated any rules, except I couldn't recruit two staff which is not a violation but does not meet the Tier 1 Extension criteria.

- I remember my solicitor told me that I can switch to Tier 4 within country few month ago, however, as you mentioned, it seems it' only possible from outside the country. Am I right?

- Do you know that I need to close down my company before applying to Tier 4 as it seems I can not be a director or shareholder to apply for Tier 4? Does the liquidation make any problem for my ILR application?

Thanks in advance

You can't switch from T1 to T4 from within the country.

You don't have to shut down your company. I am not aware of any such restriction. You can't be employed and work for the company, but a Director appointment is not employment.

Thanks again for your prompt response.

I was concerned due to the following statement in the Tier 4 of the Points Based
System – Policy Guidance by HO,

Self-employment and engaging in business activity
You cannot be self-employed or engage in business activity. ...
307. This would include the following:
 setting up a business as a sole trader or under a partnership
arrangement and that business is either trading or establishing a
trading presence;
 being employed by a company in which you hold shares of 10% or
more (including where the shares are held in a trust for you); or
 working for a company where you also hold a statutory role, such as
a director.

What's your idea about it?

Can I keep it open and be a Director and only share holder but inform HMRC and make it dormant?

Thanks again. I really appreciate your time and cooperation

[marcnath]

Thanks again for your prompt response.

I was concerned due to the following statement in the Tier 4 of the Points Based
System – Policy Guidance by HO,

Self-employment and engaging in business activity
You cannot be self-employed or engage in business activity. ...
307. This would include the following:
 setting up a business as a sole trader or under a partnership
arrangement and that business is either trading or establishing a
trading presence; ==> does not apply
 being employed by a company in which you hold shares of 10% or
more (including where the shares are held in a trust for you); ==> Cannot be employed,
i.e. not on payroll, get salary, etc.or
 working for a company where you also hold a statutory role, such as
a director. ==> Again, key is working. In fact, this actually supports the idea that you can be a Director

What's your idea about it?

Can I keep it open and be a Director and only share holder but inform HMRC and make it dormant? ==> Yes, that would be one solution. But then, you could just as well liquidate it and save some additional administrative overhead.

Thanks again. I really appreciate your time and cooperation

[emperor.uk2009]

Thanks again for your prompt response.

I was concerned due to the following statement in the Tier 4 of the Points Based
System – Policy Guidance by HO,

Self-employment and engaging in business activity
You cannot be self-employed or engage in business activity. ...
307. This would include the following:
 setting up a business as a sole trader or under a partnership
arrangement and that business is either trading or establishing a
trading presence; ==> does not apply
 being employed by a company in which you hold shares of 10% or
more (including where the shares are held in a trust for you); ==> Cannot be employed,
i.e. not on payroll, get salary, etc.or
 working for a company where you also hold a statutory role, such as
a director. ==> Again, key is working. In fact, this actually supports the idea that you can be a Director

What's your idea about it?

Can I keep it open and be a Director and only share holder but inform HMRC and make it dormant? ==> Yes, that would be one solution. But then, you could just as well liquidate it and save some additional administrative overhead.

Thanks again. I really appreciate your time and cooperation

Wow, Many thanks for speedy response.

I see. So, I can either make it as dormant, otherwise, May I know what do you suggest to satisfy the HO without going for liquidation that I'm not working in my company as I prefer to keep it open rather than close it.

I'm not on payroll as the salary is less than less than £113 a week.

Thanks again

[emperor.uk2009]

You also can leave the UK before visa expiry and come back with a new visa within 180 days without breaking your continuous stay.

Many thanks zimba88 foe your prompt response.
I've searched a lot and red the HO articles but I couldn't get it completely. Can I leave the country before the expiry date and apply for a new visa in next couple of month and return back to the country less than 180days after the voluntary leave? Or gap between two visas shouldn't be more than 28 days?

Example:
T1 Visa Expire 20 Mar 18
Leave by 18 Mar 18
Apply T4 Visa on 1 Jul 18
Enter UK 25 Jul 28

[zimba]

Yes

https://www.gov.uk/government/publicati ... -residence

[emperor.uk2009]

Yes
https://www.gov.uk/government/publicati ... -residence

Many thanks zimba88 for your prompt response. Sorry, I didn't get it.

So, my continuous residence is not broken if the gap between two valid visas would be over 28 days but returned with a valid visa within 160 days from date of leave?

This is what I get from the HO article you kindly sent,
Breaks in continuous residence
If the applicant had existing leave to enter or remain when they left and returned to
the UK, the existing leave does not have to be in the same category on departure
and return. For example, an applicant can leave the UK as a Tier 4 (General) student
and return with leave as a spouse of a settled person. Continuous residence is not
broken as the applicant had valid leave both when they left and returned to the UK.

[zimba]

That is what I alluded to. As I said above your continuous period will be protected if you leave with a valid visa and return within 180 days with another visa.

[emperor.uk2009]

That is what I alluded to. As I said above your continuous period will be protected if you leave with a valid visa and return within 180 days with another visa.

Many thanks zimba88. Yes, you are right. Many thanks

I've copied the following example by HO for others, hope it will be useful.

Examples of continuous residence
Page 14 - Published for Home Office staff on 03 April 2017

Example 2
An applicant:
• enters the UK on 1 September 2004 with entry clearance as a student which is
valid until 31 October 2005
• leaves the UK on 25 October 2005, before their previous leave expired
• re-enters the UK with valid entry clearance as a student on 5 January 2006

HO Response: The person had valid leave on the date of their departure and on the date of their
return to the UK, and the time spent outside the UK was less than 6 months.
Continuous residence has been maintained, even though the person entered the UK
with a fresh grant of leave.

[emperor.uk2009]

That is what I alluded to. As I said above your continuous period will be protected if you leave with a valid visa and return within 180 days with another visa.

Just a last question. Sorry for disturbing you at night.

Does this leave out of country will be part of overall absences of 540 days in the 10 year period? And does this time will be considered as a part of 10 year period?

[zimba]

Any absence from the UK will be counted towards the 540 days limit under long residence

[emperor.uk2009]

Any absence from the UK will be counted towards the 540 days limit under long residence

Many thanks for your help and informative responses

[emperor.uk2009]

Hi, Thanks for your effort on this forum which is amazing.

I've been offered a PhD position and as it is in the area which I was always interested to work on which is why I'm going to switch my Tier 1 (Entrepreneur) Visa by leaving the country and apply for Tier 4.

However, I'm concerned about my company which I'm still the director and only share holder of the company.

I've discussed this matter with different solicitors and they have different understanding on Home Office rules about running a company. I prefer to do not close the company in order to prevent any issues for my ILR in next couple of year, which is why I prefer to make the company DORMANT and freeze all the activities rather than take it to liquidation.

Therefore, I wonder if you do me a favour and share your opinion.

Thanks in advance for your time and attention
Kind regards

According to HO
Self-employment and engaging in business activity
You cannot be self-employed or engage in business activity. ...
307. This would include the following:
 setting up a business as a sole trader or under a partnership
arrangement and that business is either trading or establishing a
trading presence; which I'm not
 being employed by a company in which you hold shares of 10% or
more (including where the shares are held in a trust for you); =I'm not on Payroll due to LE and I can inform HMRC that no salary would be taken as company is dormant
 working for a company where you also hold a statutory role, such as
a director. some solicitor say that as the company is dormant, there won't be any activity so no working happening

[sah10406]

I've been offered a PhD position and as it is in the area which I was always interested to work on which is why I'm going to switch my Tier 1 (Entrepreneur) Visa by leaving the country and apply for Tier 4.

However, I'm concerned about my company which I'm still the director and only share holder of the company.

I've discussed this matter with different solicitors and they have different understanding on Home Office rules about running a company. I prefer to do not close the company in order to prevent any issues for my ILR in next couple of year, which is why I prefer to make the company DORMANT and freeze all the activities rather than take it to liquidation.

If you don't want to close the company, why switch to a Tier 4 visa at all? Why not continue with your company and your studies under Tier 1 (Entrepreneur)?

[CR001]

If you don't want to close the company, why switch to a Tier 4 visa at all? Why not continue with your company and your studies under Tier 1 (Entrepreneur)?

OP has failed to meet the requirements of job creation for a Tier 1 Ent extension and is looking for a route to stay in the UK to complete 10 years LR.

uk-tier-1-entrepreneur-visas/tier-1-ent ... l#p1563324

[sah10406]

OP has failed to meet the requirements of job creation for a Tier 1 Ent extension and is looking for a route to stay in the UK to complete 10 years LR.

Thanks. Maybe merge topics?

[CR001]

OP has failed to meet the requirements of job creation for a Tier 1 Ent extension and is looking for a route to stay in the UK to complete 10 years LR.

Thanks. Maybe merge topics?

To Tier 4 sub forum??

[sah10406]

OP has failed to meet the requirements of job creation for a Tier 1 Ent extension and is looking for a route to stay in the UK to complete 10 years LR.

Thanks. Maybe merge topics?

To Tier 4 sub forum??

Was thinking maybe merge this offshoot with the original topic wherever it is, but perhaps it's fine.

[emperor.uk2009]

I've been offered a PhD position and as it is in the area which I was always interested to work on which is why I'm going to switch my Tier 1 (Entrepreneur) Visa by leaving the country and apply for Tier 4.

However, I'm concerned about my company which I'm still the director and only share holder of the company.

I've discussed this matter with different solicitors and they have different understanding on Home Office rules about running a company. I prefer to do not close the company in order to prevent any issues for my ILR in next couple of year, which is why I prefer to make the company DORMANT and freeze all the activities rather than take it to liquidation.

If you don't want to close the company, why switch to a Tier 4 visa at all? Why not continue with your company and your studies under Tier 1 (Entrepreneur)?

Hi @sah10406, Thanks for your response.
As discussed above although I'm still a genuine entrepreneur and I participated in various conferences, exhibitions to present my product and even received an award for it, plan didn't well financially and fortunately a university offered a PhD with bursary to continue my research and product within the university.

Therefore, I wonder if you please consider my issue as it is and please do not prejudice it.

Thanks in advance

[emperor.uk2009]

If you don't want to close the company, why switch to a Tier 4 visa at all? Why not continue with your company and your studies under Tier 1 (Entrepreneur)?

OP has failed to meet the requirements of job creation for a Tier 1 Ent extension and is looking for a route to stay in the UK to complete 10 years LR.

uk-tier-1-entrepreneur-visas/tier-1-ent ... l#p1563324

Thank you @CR001. Sorry that I had to post a separate post as I searched and I couldn't find any similar case, and I didn't want it to make it complicated as I didn't have a clear plan few month ago and I have now due to PhD Placement.

I've tried couple of solicitors and they have two different address which made me concerned so I though to share it with people in here for solution and advice, which may be useful for others as well.

Thanks in advance for your time and cooperation