New Immigration Rules Affecting UK Self Sponsor Visas – The Way Forward!

On April 9th some important changes were made to the Rules that apply to Skilled Workers. This article highlights one particular aspect of these changes.

One of the main purposes of the new regime is to restrict the use of monies that an applicant for a self sponsor visa invests in the start up company the applicant intends to set up. This has been a very popular method for entrepreneurs
and those with high level skills to get into business in the U.K. through a route that could lead to permanent residency. The company that is set up sponsors their visa.

The monies that have been invested in these new businesses have typically been used to get the business off the ground and meet various business expenses including salary due to the Applicant. The salary level is in essence the salary level set out in the job code for the particular work they are undertaking for the company and is put down on the Certificate of Sponsorship.

In deciding whether or not the company is paying the correct amount of salary certain sorts of monies used by the company cannot be included and have to be deducted from the salary amount in calculating whether or not the salary level has been achieved.

As with the Immigration Rules generally it can be difficult to decipher exactly what they mean in detail and how the Home Office will apply the new provisions. If the Applicant does invest monies in the start up company there are some quite complex Rules as to how such monies will be deducted in working out if the company is meeting the necessary salary threshold. So the cautious advice would be at this time to therefore take steps to consider carefully how to
arrange for the monies the company needs in its initial stages to be provided by other sources.

There are a variety of possible external sources of funding that could be considered. One obvious solution is to ensure that the company generates sufficient trading income to meet the salary requirements but of course there will be others unrelated to the Applicant.

There are serious implications if the Home Office make entrepreneurs look elsewhere to set up their businesses particularly when the U.K. is looking for economic growth but as things stand it would be hoped most such persons will have alternative ways of financing their company in the early stages. There may also be other visa routes that will be worthy of consideration such as the Innovator Founder visa and the Expansion Worker visa. Indeed there might even be a greater interest in the Republic of Ireland which is in the EU and has a similar cultural heritage and lifestyle and which can also in time provide a route to the U.K. after obtaining Irish citizenship.

Clearly it will be useful to demonstrate the genuineness of the funding and there are ways in which that might be done. Those skilled workers who had no real business development intentions or skills and with inadequate finance will be affected but others should be able to find ways to achieve their ambitions within the new environment.