One category, which on the face of it, looks to be simple is the Tier 1 (Investor) visa. This involves demonstrating that you have £2 million to invest in the UK, but in reality obtaining and then extending the visa can be difficult. Here are some of our top tips on avoiding having an Investor visa application refused:
1. It's not just about showing you have the money
As strange as it may seem it's not enough to have £2 million to invest. You also have to provide the correct evidence to show that you have the funds. This evidence can vary depending on how the funds are currently held, and how long they have been held for so simply providing a bank statement will not be sufficient. Instead it may be necessary to provide a letter from the bank, and further evidence of the source of funds if the money has not been held in the same bank account for 90 days. Similarly, if funds are held in a joint account with the visa applicant's partner then additional evidence must be provided to demonstrate that the visa applicant can invest the funds freely.
Many initial applications for Tier 1 (Investor) visas are refused due to evidential reasons that can easily be avoided with careful planning.
2. Know the timescales for investing
A common misconception is that once a Tier 1 (Investor) visa is granted the visa holder can take their time to identify suitable investments, and has the full 3 year visa period to invest the £2 million but this is not the case. The Immigration Rules require the full £2 million to be invested within 3 months of the individual entering the UK to activate their visa.
This may seem like a long time but often it is necessary to transfer the funds to the UK, which can involve banks or organisations carrying out enhanced due diligence causing delays. Failure to invest the money timeously can lead to a visa being cancelled or an extension refused.
The best way to avoid this issue is to identify the wealth manager who will invest the funds on your behalf, and carrying out all necessary checks, before the visa application is submitted.
3. Know how the funds can be invested
It goes without saying that when you are investing a significant sum of money it is it vital to have a detailed investment strategy that analyses both risks and rewards. When the investment forms part of a Tier 1 (Investor) visa it is equally important to carefully consider the investments, as it is not possible to invest in offshore companies or trusts or collective investment schemes. Instead the investment must be made directly into a UK company or into UK bonds. Failure to invest the funds properly can make it impossible for someone to extend their visa.
4. Carefully consider re-investment
The nature of investment often involves selling one investment and buying another, but Tier 1 (Investors) need to be careful to ensure they reinvest the correct funds and do not use profits to pay Capital Gains Tax or the wealth manager's fees.
In reality the Tier 1 (Investor) visa is as complicated as any other visa application, and specialist immigration advice is necessary to avoid many common problems. It is also important for a Tier 1 (Investor) to instruct specialist wealth management and tax advice to ensure their investment does more than secure their right to stay in the UK.
If you are interested in finding out more about the Tier 1 (Investor) visa, or you already have a visa but want to confirm you will be able to extend it please get in touch.
Morton Fraser's Designed for Life Service is a comprehensive offering involving both legal specialists and Independent Financial Advisors and we are fully equipped to meet the needs of Tier 1 (Investors) and their families.