Tier1 200k extension application successful

[Roin]

Dear Forum members

Thanks to everyone for your insightful posts.

I changed from Tier 2 ICT to Tier 1 Entrepreneur 200k in Sept 2015. I want to commence preparing for my extension due by Sept 2018 and will appreciate guidance to any post regarding sample documents to supply, timelines etc.

A few more details to enable the house to provide some more guidance:

Formed Company A (tech consultancy) immediately. I transferred over 130K in 3 or 4 installments (30k, 50k, 30k, 20k) over the period, employed 2 staff by January 2016 but had to lay them off by mid-2017 due to the difficult operating environment. We made some money but not enough to keep them on. Now working hard on marketing & sales while using freelancers and consultants when needed. Will these affect my genuine entrepreneur test consideration?

Company B (small retail) was formed before my application but commence active trading in July 2016. 2 part-time (16hr/week) minimum wage staff employed from Nov 2016 until November 2017 when it was reduced to 1 part-timer. Over 100k invested in buying stock, setting up shop etc. Planning to sell up after the successful extension to focus on company A afterward. Will this affect my ILR application 2 years later?

I have been super active in running both businesses and will really need to slow down upon successful extension to focus on delivering Company A (which was the one business plan I submitted during my initial leave to remain application)

Thanks in advance and if anyone has a list of documents to submit and sample cover letter etc - that will be appreciated. I also like overloading the HO with documents but reading this forum - minimal is encouraged!

[zimba]

Formed Company A (tech consultancy) immediately. I transferred over 130K in 3 or 4 installments (30k, 50k, 30k, 20k) over the period, employed 2 staff by January 2016 but had to lay them off by mid-2017 due to the difficult operating environment. We made some money but not enough to keep them on. Now working hard on marketing & sales while using freelancers and consultants when needed. Will these affect my genuine entrepreneur test consideration?

You must IGNORE all the opinions and claims made on this forum regarding genuineness. Genuineness is only determined by HO procedures and ONLY after thorough investigation. Normal business practices are perfectly fine.

Company B (small retail) was formed before my application but commence active trading in July 2016. 2 part-time (16hr/week) minimum wage staff employed from Nov 2016 until November 2017 when it was reduced to 1 part-timer. Over 100k invested in buying stock, setting up shop etc. Planning to sell up after the successful extension to focus on company A afterward. Will this affect my ILR application 2 years later?

Not relevant to ILR at all. You are free to do business as you wish

[Roin]

Thanks Zimba88. I appreciate this.

I was wondering - my international passport is due for renewal in October. Should I renew before applying or should I proceed anyway?

Also how close to my expiration am I allowed to apply - since am due for extension in September - can I apply in June?

Lastly for now - how do I show that the invested funds has been spent on legitimate expenses? Should I highlight such expenses on the business bank statements - total them up and include that in the cover note - or should I leave the CW to work it out from the statements themselves?

Thanks in advance for your kind assistance

[marcnath]

I was wondering - my international passport is due for renewal in October. Should I renew before applying or should I proceed anyway?

It should not matter. However, I would renew before so if I need to travel immediately after extension, I would not be stuck with an expired passport.

Also how close to my expiration am I allowed to apply - since am due for extension in September - can I apply in June?

I haven't seen a limit for extension applications. But if you apply in June and get your extension in July, you will need another extension in July 2020 as you would not have reached your 5 years when the extension period expires. So you don't want to take that risk.

Lastly for now - how do I show that the invested funds has been spent on legitimate expenses? Should I highlight such expenses on the business bank statements - total them up and include that in the cover note - or should I leave the CW to work it out from the statements themselves?

There is no requirement to show expenses. The CW will come back to you if they need more info

[Roin]

I was wondering - my international passport is due for renewal in October. Should I renew before applying or should I proceed anyway?

It should not matter. However, I would renew before so if I need to travel immediately after extension, I would not be stuck with an expired passport.

Also how close to my expiration am I allowed to apply - since am due for extension in September - can I apply in June?

I haven't seen a limit for extension applications. But if you apply in June and get your extension in July, you will need another extension in July 2020 as you would not have reached your 5 years when the extension period expires. So you don't want to take that risk.

Lastly for now - how do I show that the invested funds has been spent on legitimate expenses? Should I highlight such expenses on the business bank statements - total them up and include that in the cover note - or should I leave the CW to work it out from the statements themselves?

There is no requirement to show expenses. The CW will come back to you if they need more info

Thank you Marcnath for your advice, I really appreaciate it. . Regarding expenses, how would the CW determine legitimacy? I was wondering if I have to do the maths myself taking out my salary although am sure both businesses definitely consumed more than 200k legitimate expenses over 3 years. Just wanting to be sure that no stone is left unturned. Thanks

[marcnath]

Thank you Marcnath for your advice, I really appreaciate it. . Regarding expenses, how would the CW determine legitimacy? I was wondering if I have to do the maths myself taking out my salary although am sure both businesses definitely consumed more than 200k legitimate expenses over 3 years. Just wanting to be sure that no stone is left unturned. Thanks

You are going to be submitting FPS documents that will show your salary. Accounts will show any dividends that have been taken, and so on.
The point is CW has enough information to at least ask for more information if they need to.
But, if you think you are in violation of the investment conditions, you should take corrective action now and invest more. If you are confident everything is in order, there is no need to prove it.

[Roin]

Thank you Marcnath for your advice, I really appreaciate it. . Regarding expenses, how would the CW determine legitimacy? I was wondering if I have to do the maths myself taking out my salary although am sure both businesses definitely consumed more than 200k legitimate expenses over 3 years. Just wanting to be sure that no stone is left unturned. Thanks

You are going to be submitting FPS documents that will show your salary. Accounts will show any dividends that have been taken, and so on.
The point is CW has enough information to at least ask for more information if they need to.
But, if you think you are in violation of the investment conditions, you should take corrective action now and invest more. If you are confident everything is in order, there is no need to prove it.

Thanks Marcnath. The information helps. Just as an aside, a friend was arguing with me that you don't have to spend all the money as long as the rest is in the business bank account. My understanding is different though - 200k or more should have been expended (i.e. go out of the business account legitimately). Am I correct?

[marcnath]

Thank you Marcnath for your advice, I really appreaciate it. . Regarding expenses, how would the CW determine legitimacy? I was wondering if I have to do the maths myself taking out my salary although am sure both businesses definitely consumed more than 200k legitimate expenses over 3 years. Just wanting to be sure that no stone is left unturned. Thanks

You are going to be submitting FPS documents that will show your salary. Accounts will show any dividends that have been taken, and so on.
The point is CW has enough information to at least ask for more information if they need to.
But, if you think you are in violation of the investment conditions, you should take corrective action now and invest more. If you are confident everything is in order, there is no need to prove it.

Thanks Marcnath. The information helps. Just as an aside, a friend was arguing with me that you don't have to spend all the money as long as the rest is in the business bank account. My understanding is different though - 200k or more should have been expended (i.e. go out of the business account legitimately). Am I correct?

Your friend is correct - there is no requirement to have spent all the money. Having said that, if you have a shell business with the only expense of the 200K being two minimum wage jobs, you can expect to be questioned and even denied based on genuineness.
So, you don't have to spend all the money but there should have been reasonable expenses needed for a business

[Roin]

Thank you Marcnath for your advice, I really appreaciate it. . Regarding expenses, how would the CW determine legitimacy? I was wondering if I have to do the maths myself taking out my salary although am sure both businesses definitely consumed more than 200k legitimate expenses over 3 years. Just wanting to be sure that no stone is left unturned. Thanks

You are going to be submitting FPS documents that will show your salary. Accounts will show any dividends that have been taken, and so on.
The point is CW has enough information to at least ask for more information if they need to.
But, if you think you are in violation of the investment conditions, you should take corrective action now and invest more. If you are confident everything is in order, there is no need to prove it.

Thanks Marcnath. The information helps. Just as an aside, a friend was arguing with me that you don't have to spend all the money as long as the rest is in the business bank account. My understanding is different though - 200k or more should have been expended (i.e. go out of the business account legitimately). Am I correct?

Your friend is correct - there is no requirement to have spent all the money. Having said that, if you have a shell business with the only expense of the 200K being two minimum wage jobs, you can expect to be questioned and even denied based on genuineness.
So, you don't have to spend all the money but there should have been reasonable expenses needed for a business

Thanks for that. I never knew. I actually made business decisions based on the race to spend 200k in 3 years. I would have ran the businesses differently - but its okay. I have learnt a lot and definitely a better entrepreneur from the experience. Thanks Marcnath. I will proceed to start gathering evidence and remain active on this board to learn more.

[Roin]

Thanks, everyone for your advise and support. My extension application was successful.

Timeline:

Sept 2015 - move from Tier 2 ICT to Tier 1 Entrepreneur. Paid lawyers. Was successful.

October 2015 - Started business 1. Employed 2 people by Jan 2016. terminated by May 2017 due to slow business.

October 2015 - Started Business 2. Employed a few part-timers.

Apply for extension in Sept 2018 all by myself after 3 months of rigorus prep and frequent visit to this fantastic site. Received Biometric letter 2 weeks later. Received BRP in October 2018.

Now in the process of ensuring I comply for the next 2 years. All advice will be appreciated and I will also be available to answer any questions from any who may need it.

Once again I wish to thank all the experienced members (and all who contributed to my post) for your guidance. Thanks