The recommendations of the Migration Advisory Committee, published in February 2014, were given effect in the legislations enacted in October 2014. The most significant change introduced in these legislations was the increase in the minimum investment requirement under the Investor Visa category from £1 million to £2 million. This change was brought into effect from 6th November 2014. All investment immigration applications made on or after this date will have to comply with the new rules and regulations.
The basic procedure for obtaining a Tier 1 Investor visa involves the applicant providing sufficient proof to the Home Office of his or her ability to transfer a sum of not less than £2 million that can be transferred into the UK. However, there are other rules to be followed and other procedures to be complied with, especially if the applicant does not hold funds in cash, or if the applicant does not hold funds in a sterling bank account for three consecutive months, or if the financial institution holding the funds is not prepared to issue the requisite statements.
The procedure for obtaining entry clearance as a Tier 1 Investor or applying for initial grant of leave for switching into the Tier 1 Investor category involves fulfillment of the following conditions:
- Applicant must have a sum of not less than £2 million of own money in a duly-regulated financial institution. Funds held by spouse or civil partner may be considered subject to submission of the required documents.
- The money must be freely disposable in the UK.
- If not held in sterling, then the sum must be converted into sterling.
- If the sum of £2 million is not held in a bank account for at least three months, then the applicant must submit formal proof about the source of the funds.
The grant of entry clearance will allow the applicant to enter and reside in the UK for a period of three years and four months. If the applicant is switching to the Investor Visa category from another category, then he or she can enter and reside in the UK for a period of three years.
Investors seeking to reside in the UK beyond the period of three years or three years and four months, as applicable, must make apply for extension of their residency permit for an additional two years. The following conditions must be fulfilled in order to become eligible for extension:
- Proof of having invested at least £2 million in qualifying investments—government bonds or share or loan capital in active and trading companies registered in the UK that are permitted to receive such investments.
- The above-mentioned investment must be made within three months of the investor’s entry into the UK, and must be maintained till the date of the application for extension.
- In event of sale of assets within the investment portfolio, the investor should ensure the value of the investments do not fall below the minimum requirement.
Immigrants investing £2 million must hold the investment for a period of five years in order to become eligible for settlement or the Indefinite Leave to Remain. The conditions for applying for settlement are:
- The investor should not reside outside the UK for 180 days or more per calendar year.
- The investor and all dependents should comply with all requirements related to Knowledge of Life and proficiency in English, unless otherwise exempted from these requirements.
- While immigrants investing a sum of £2 million can seek settlement after a period of five years, those investing £5 million and £10 million can apply for settlement after three and two years of residence respectively.
- The minimum requirement of £2 million must be invested within three months of the applicant’s entry in the UK. The additional investments can be made later but application for settlement cannot be made until the investments have been maintained for the minimum period of two or three years, as may be applicable.
Investor immigrants are permitted to include their spouse, civil partner, same-sex partner, and even unmarried partner in the application. Further, minor children too are entitled to accompany the investor. However, both parents of minor children must be either seeking entry at the same time as the children, or must be otherwise entitled to reside in the UK.
Investor immigrants residing in the UK for a period of not less than five years are eligible to apply for citizenship. The immigrants must comply with a wide range of conditions and requirements including:
- Residence in the UK for not less than five years prior to the application.
- Applicant must have held Indefinite Leave to Remain in the UK the last year immediately preceding the application for citizenship.
- Residence outside the UK should be more than average 90 days per year or 450 days during a five year period. Longer absences may be permitted under certain circumstances.
Under these rules, those investing £2 million can apply for citizenship after a period of five years and an additional 12 months residence under Indefinite Leave to Remain. Investor immigrants investing £3 million or £5 million can apply for citizenship after five years of residence. Dependents can apply for citizenship after a period of six years of residence. Dependents married to British citizens are exempt from this rule.
Since those seeking citizenship must not reside in the UK for 180 days or more, such immigrants automatically become tax residents in the UK, and shall be subject to tax in the UK. Such investor immigrants must ensure their assets are structured in a tax-efficient manner before their entry into the UK.
Investor immigrants must consider the following practical points to minimize risk of issues or difficulties during entry, residence, or application for Settlement:
- Maintain detailed travel records for proof that investor has not resided outside the UK for 180 days or more in a calendar year. Those seeking citizenship must not reside more than 90 days outside the UK in a calendar year.
- Only the main investor is subject to the residence requirements. Hence, the main investor should be that person who is most likely to spend a minimum of 180 days in the UK in a calendar year.
- Partners who have not married or have not finalized a civil partnership must provide proof of cohabitation in a committed relationship for a period of not less than two years. Proof of cohabitation includes joint bank statements, and the same must be included in the application.
All investor immigrants are required to undergo due diligence. This may result in a delay in the opening of the account that will hold the applicant’s investments in the UK. Early investments will help minimize delays in the processing of the investor’s application
Source: MondaqGeneral Information: Contact us to receive more information about this article.
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