Investment for extension

Hi all,
After reading all the forums related to extension, I am still confused about the director loan and the actual investment. I understand we need to transfer the amount in buss acc but what about the later part as some says staff wages, office rent etc is not counted towards investment. I did went through the policy guidance but need an actual procedure by which we can spend on business carefully. As all can understand 50000 is not a small amount. All gurus and senior members can help all the existing entrepreneur to go carefully so that we don't panic before extension time.

Thanks & Regards

Daer Satinder,

i have exactly the same problem its been one year of my Tire 1 Ent visa and have already invested around 20k but i am not so sure of lease if this includes in investment and how to prove that investment is made by me or on my behalf. i have intially tranfferd money from my personal account to my business account and have been spending money from my business account. my accountant given me one suggestion of buying 100% shares of my own company and keep share certificate to prove my investment in the business and where ever my company will spend this money (regard less expence or investment) will fulfil my investment requirement. but i am still confused how this is really gona work out ony one please advice!!! thanks

Irfan

Hi Irfan,
We are on same boat, will need to ask the gurus to have there say by only using evidence and references. I respect there judgments but have to be supported through documents from UKBA.

It's difficult to be sure about your case, as I don't have the details, but all legitimate business expenses, other than your own remuneration (salary, dividend, director's loan out of the company) counts as spending on the business.
If you clearly transfer the money into the business, and the accounts show that you have invested the amount, it should be fine.
This is general advice only - without seeing your accounts, statements etc, it's impossible to give you personal, definitive advice.

Hope it's helpful anyway

@ Ben thanks for your help, As you are a ECA Legal advisor would this be possible to have your contact details so i can contact you for Legal services in the future. Thanks Sir

@Stainder as we both are on the same boat it would be very helpful for both of us to keep in touch in the future (if you would like).

My Email Address is : nini2002pk@yahoo.com

Kind Reagrds,

Irfan

Hi
As per rule you need to invest 50k.
1-Q) So if I Buy commercial Property value 50k means I met the requiement ?

2-Q) Can I SUB LET PART or TABLE SPACE of the property to generate more Income ?

3-Q) Can I sell propery after first extention ( 3 YEARS)or do I have to keep it till I ILR ?

4-Q)What does it means your Business should be profitable any figure or it just has to be in positive ?

Can any of the member give their opinion on it please it will be really helpfull

Thank you
Jiwani

Hi all I m still confused as well even I meet 2 3 professional accountant they are not exactly sure wat to do, they just told me transfer all money in business account then any asset u buy for business is counted as ur investment, like computer office fitting, buying property, etc but bills wages are counted as expanse not investment , this is the little information I have so I share it, I think even Ukba is confused on investment as u can't buy property in commercial area just for 50k.....

true, from accounting point of view you are right.

mcr2013 wrote:Hi all I m still confused as well even I meet 2 3 professional accountant they are not exactly sure wat to do, they just told me transfer all money in business account then any asset u buy for business is counted as ur investment, like computer office fitting, buying property, etc but bills wages are counted as expanse not investment , this is the little information I have so I share it, I think even Ukba is confused on investment as u can't buy property in commercial area just for 50k.....

yes, most of the accountants are saying that ' there is a distinct demarcation in between Expenses and really meant Investment'. Theoretically they are right, however, we are just following what HO considers the right. HO has included all legitimate expenses done for and on behalf of company as investment.

I know, as I am also rowing being on the same boat, atm there are so many obscure questions going on and over our heads. However, I think, it is always good to choose and go with minimum risky options, as we never know what the HO wants from us.

As per my Understanding to meet investment requirements you will need to show that you have transferred 50k or 200k in to your business bank account from your personal account and as a proof that money is invested by you will need to produce either Share Certificate or Director Loan agreement. Once money is gone in to your business account it will be spent by business when its needed on its growth etc. but i think you meet inventment requirments as soon as your money is tranffered in to your business account. Hope this helps

correct, but you can't just have the money lying in the business account; you gotta spend it as a normal business would do. Policy guidance states this clearly. and anyway, if you are going to hire the minimum two people, you would have to use some of the money, anyway.

yes i agree with you, but your business does not have to spend all 50k in order to meet HO requirement as you said business will spend money where its needs to be spent. you fulfil the requirement as soon as you have invested money in UK reg business. I Think ! any suggestion ?