Choose an appropriate UK business visa to increase your chances of gaining UK entry. The UK Government wants to attract overseas entrepreneurs and investors, and offers favourable tax breaks. UK business is booming, and tech companies thrive.

The taxation and visa regimes are complex. Rules and procedures frequently change.  Our focus is high net worth investors and entrepreneurs, looking to build a UK business.

The immigration system is points based. There are five tiers, or visa types.  An individual’s points score is essentially based on the individuals’ value to the UK. With a visa, individuals gain the right to work, invest, retire or study in the UK.

An overseas business does not require a visa to open a UK branch or subsidiary, but must file accounts and reports with the UK tax authorities.

Tier 1 UK business visa

The Tier 1 visa is for entrepreneurs, investors, and exceptionally talented individuals. It is the highly skilled tier, designed to attract individuals who will contribute to the UK’s business productivity and growth.

For every Tier 1 subcategory, the migrant applies in the UK to the UK Border Agency or to a British diplomatic post if overseas.  Tier 1 is the only Tier where the immigration permission attaches to the individual rather than the sponsor.

Tier 1: entrepreneur visa

A Tier 1 entrepreneur visa is for individuals from outside the European Economic Area and Switzerland, who will create or run a UK business.  The Entrepreneur visa is granted on points, e.g.

  • Access UK funds of over £200,000;
  • Dispose of these funds in the UK;
  • Speak english.

It can be possible to form an entrepreneurial team, and share the same investment funds for this visa with another applicant.

This visa enables entrepreneurs to create or manage one or more UK businesses. The business can employ the entrepreneur and pay the entrepreneur a salary. The entrepreneur can also bring family members into the UK. However, no other business can employ the entrepreneur.

Once an entrepreneur visa is granted, it becomes possible to work up to an application for indefinite leave to remain in the UK.

Tier 1: investor visa

A Tier 1 investor visa is for individuals from outside the European Economic Area and Switzerland, who will invest over £2 million in the UK. The funds can either be in the UK or abroad when the investor applies.

This visa enables investors purchase shares in, or lend capital to, active, trading UK registered companies.  The type of company in which investors can invest is restricted. There are also additional eligibility restrictions.

If you obtain an Investor visa you can live in the UK for three years.  You can subsequently apply to extend this for a further two years.

Investors can work or study in the UK, and, depending on the investment amount, can apply for settlement after 2 or 3 years. You have to:

  • Access funds of £1 million in the UK, or
    • If you intend to obtain a loan, personal assets exceeding £2million, and
    • There are conditions on the lender;
  • Intend to make the UK your base;
  • Finance yourself and family using your own money, although
    • You can live on the cash generated from the business.

If you spend five years continuously in the UK under your Investor visa, you can apply for indefinite leave to remain in the UK. You must continue to meet the investor requirements.

Tier 1: exceptional talent

This sub category is limited to 1,000 people of exceptional talent. It applies to scientists, academics and artists who have achieved international recognition.

Tier 2: skilled

The Tier 2 visa enables UK employers to sponsor an overseas individual to work in the UK. The employer must be a licensed sponsor, and must issue the individual with a Certificate of Sponsorship before the individual arrives in the UK. The employer, as sponsor, must comply with onerous record keeping and reporting obligations to retain their licence.

An employer who transfers an existing employee from an overseas office to the UK must submit evidence the employee has worked for the employer for at least 12 months.

If there is a change of employment the sponsor is required to issue a new certificate of sponsorship and the individual needs to make a new application for leave. There are however exceptions to this, for example if the employee is continuing to work for the same sponsor provided certain conditions are met.

Tiers 3, 4 & 5

Tier 3 is not currently used. It is a contingency for future immigration requirements.

Tier 4 enables overseas students to study in the UK. We do not provide advice for this Tier.

Tier 5 is for temporary or exchange workers.  It provides a visa for temporary workers, e.g. sportspeople and charity workers for up to 12 month. Religious workers can gain a visa for 24 months.

Staff transfers

Businesses move employees and directors into the UK in response to business demands.  The UK’s HM Revenue and Customs, HMRC, closely watches the movement of income and gains around the world for tax avoidance.  If employees and directors don’t accurately report their UK income, sizeable penalties result.

One-stop business support

We are more than immigration lawyers. With our tax and commercial expertise, we are a one-stop shop for overseas business people to create a UK business. This spans:

For international entrepreneurs and investors, we:

  • Set up UK branch offices or subsidiaries;
  • Utilise tax breaks: e.g. Entrepeneurs’ relief and EIS
  • Assess agreements, e.g. distribution and agency agreements;
  • Facilitate and obtain visas for staff seconded to the UK;
  • Ensure compliance with UK regulations.
  • Co-ordinate your tax position across the UK and overseas jurisdictions,
    • Using our network of overseas accountants and lawyers.

For those working in multiple countries during the same tax year, we:

  • Draft and review dual contracts of employment;
  • Navigate double taxation treaties;
  • Obtain HMRC clearances for tax treatments.

We assess your tax status: i.e. if you are:

  • UK resident;
  • UK ordinarily resident; and or
  • UK domiciled.

We minimise the tax paid by internationally mobile employees, who are:

  • Seconded to the UK;
  • Seconded overseas to work for the same employer, group or unrelated employer;
  • Minimise taxation of payments received under long term bonus plans, shares and options, especially
    • If performance conditions straddle tax years involving UK and non-UK residence periods;

In addition, we assess which of the following three taxation methods apply for income or gains:

  1. Not taxable in the UK, no matter the source;
  2. Arising outside the UK, and taxable on the remittance basis; or
  3. Arising anywhere in the world, and taxable in the UK.

Relevant UK tax reliefs

The UK offers a wide variety of legitimate tax breaks. These include:

Entrepreneurs’ relief

When a shareholder sells all or part of a business, capital gains tax may be payable. Entrepreneurs relief, if available, reduces the rate of capital gains tax on qualifying assets to 10% instead of 18% or 28%.  There are two important conditions. The seller must, for over 1 year prior to the sale date:

  • Own over 5% of the company’s shares and voting rights;
  • Be a company director or employee.

Enterprise Investment Scheme

The Enterprise Investment Scheme, EIS, offers tax relief to equity investors in small, high risk trading companies. However, not every small company qualifies.

In essence, investors can gain income tax relief for 30% of their investment, up to a £1 million annual investment limit. Clearly the investor has to be paying UK income tax to benefit.

In addition, there is no capital gains tax on profits if the investor:

  • Held the shares for over 3 years;
  • Received income tax relief on the investment.

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