Entrepreneur visa extension

Helping Person

I don't think that the extension would solely be refused on the basis that the business incurred losses in the first 3 years. In fact, I have seen many businesses in the similar situation. It is therefore your job to ensure that Home Office sees this as a genuine business. If I was you, I would ask your accountant to prepare a cover letter explaining why the businesses is in loss and forecasting when the business would be expected to turn the losses into profits.

As explained on my post, I have clearly mentioned that Home office will probably not refuse based on losses only but would determine if the business is growing and as your business has incurred less losses than previous years than this indicates growth and should not be a problem

Hello DNF,

Thanks a lot this is very positive.

Would you please be able to provide any pointers/comments/source with regards to Cover Letter explaining why business is in losses and forecasting when the business will be expected to turn the losses into profits?

The reason for this request this is, it will really help when I approach my accountant for any such letter or report otherwise he probably would not be really helpful. But if I say to him, I need something along these lines then I have more chances to get it done from him.

Accountants must always be helpful to their clients but yes he may charge extra for this letter as it is not part of his job to prepare such letter.

You can tell him to prepare a letter comparing the last 3 years P&L. He can than draw the attention to the increase in revenue in % and cost of sales plus all the other expenses. He will then be able to mention as to why the revenue was increased in the second year which could be due to extra cost in advertisement or have hired an extra staff responsible to do marketing. It is not easy for me to point out what he need to write as this is based on the P&L and every qualified ad professional accountant will be able to identify the core points on the business financials.

This is usually done by big company accountants to draw their clients attention to their strengths and weaknesses. We do it for every clients of ours to ensure that our clients are aware of us lending an extra hand.

Dear Dnf,

Thank you for replying my queries.

I would really appreciate if you kindly answer the possible last query !

What was the difference b/w the date (no of days) of your application for extension and your latest unaudited/management accounts with 50K investment shown.

Basically I need to know how old the un-audited accounts are acceptable before the date of application made ?

If my latest unaudited annual accounts show 50k investment and the unaudited accounts signed/prepared 50 days before the date of application ? can they be acceptable for the case being older than 30 days before the date of application ?

My unaudited accounts will be for Year ended 30 June 2016 to be sent with application to be made on 22 Aug 2016.hence the unaudited accounts will be 50 days old ! and I dont need to send July 2016 management accounts as 50K already shown in YE 30 june 2016 Accounts , any issue in that ?

Secondly , If the 50K shown in unaudited accounts and the account compilation report by accountant also going to be submit , if there is any need for extra letter by accountant confirming 50k has been invested(as I have seen some people in this forum suggesting to send this extra letter as well , did you send any such letter along with your unaudited accounts and accounts compilation report ?


Really appreciate if you kindly respond at your earliest convenience.

Hi DNF/Zimba
I have two business bank accounts,one current and second saving.
I transferred investment funds from my personal accounts to business saving account as my business is in profit so investment funds are in my saving account and generating bank interest.
My all business transactions are through my business current account.
I did not see any policy rules regarding business bank account.
I'm worried now do I need to transfer my investment funds to current account instead of business saving accounts.any comment

AMS 2013

My accounts were till 30/11/2015 and I applied on 16/02/16 so no issue. However, I made sure that the letters from the accountant were dated under 30 days.

Yes, your accountant will need to write a letter confirming your investment.

Business Genius

Business savings account is still a business account and I don't suppose you would have any issues concerning the transfer.

Thanks DNF
I just want to know although business can have 2 or more accounts according to the nature of business but you never know about visa application decision.

business genius wrote:Hi DNF/Zimba
I have two business bank accounts,one current and second saving.
I transferred investment funds from my personal accounts to business saving account as my business is in profit so investment funds are in my saving account and generating bank interest.
My all business transactions are through my business current account.
I did not see any policy rules regarding business bank account.
I'm worried now do I need to transfer my investment funds to current account instead of business saving accounts.any comment

You can have multiple accounts for a business. HO does not care which one you use as long as it is a pound sterling cash only account

Thanks Zimba88
Both the accounts are £ cash only accounts.

Many thanks DNF,

Hi Dnf,

Many thanks for your reply.

If the Account Compilation report by accountant won't be sufficient ? as I can't see any requirement in policy for providing separate accountant letter confirming investment, policy only say to provide un-audited accounts with Account Compilation report.

Kindly clarify with reference to policy/rule.

AMS

The compilation reports, usually does not mention director loans or investments.

As mentioned, I would strongly suggest to have an accountants letters confirming the investment. If you cannot find this requirement on the guidance than it is your choice not to provide that letter. However, providing that letter is much easier than regretting later on in case if home office refuses due to the lack of that letter.

I am here to assist (not advice) the members based on my experience with this particular visa. However, due to my involvement in running a practice, it is therefore time restrictive for me to spend time exploring the guidance. It is therefore your choice if you choose not to provide that letter.

Hi dnf,

I am using 12pay payroll software and it doesn't produce RTI full payment submission as required by HO but it does produce called period summary exactly looks like other FPS. As accountant you know may be very well.

I have send P11 with my application and also submit the letter from accountant as P11 clarification. Now i have seen in this thread HO refusing application whoever submit P11. Now i am thinking to send copies of "period summary" with cover letter ?

Or what else can you suggest ?

Regards

Regular user

Submission of FPS reports is mandatory for your application. If you have not sent it and only sent the P11 than you have created a bit of an issue yourself. However if your payroll software reports that you sent to Home Office are like FPS than Home Office may accept it.

FPS with P11 - condition fulfilled
P11 but no FPS - condition not fulfilled

If I was you, I would request the FPS submission reports from HMRC

Hi dnf,
Since you are an accountant please give your opinion,
My company was opened with 50k share capital before I got my initial leave then I transferred the money after getting the visa in 6 transections. As a share capital investor I don't need to send bank statements I am really confused about what date to put on the form. My accountant couldn't give a satisfactory answer.
Do you think putting the last date of transfer is the best option or shall I put the year end date of that accounting year? Or do you suggest something else.

I would really appreciate any suggestion.

Thanks

Dear DNF,

Thanks for your prompt reply.

As I have very least knowledge of accounting being Marketing Consultant , I respect your knowledge & skills (as accountant) as this is your area of expertise. I was only referring the documents what was required in policy but if you believe a separate accountant letter is required than you must be right as you are expert in Accounting profession and better know the standard letters by accountants.

Many thanks

Thutmose

If your company was opened with £50k share capital than the date you would put on the form would be the date that share capital was issued. Ask your accountant to check the annual return and the date of £50k share capital would be the same date as shown on annual return.

One other thing may have been done was that £50k share capital was issued initially during company incorporation. If this is the case than the date would be the same date when your company was incorporated.

Thanks dnf.
Yes all shares were issued during company incorporation.
But I initially applied saying money available to invest in my personal account.
Now if I put the share issue date as date of investment which is 4 months before they issued the visa, it won't go with my initial statement.
Will it be wrong to put the actual transferring date as investment date?

Dear thutmose


Me also 0n same case as your money was transferred after visa granted but share was issued prior to initial visa. Any ideas about this guys.


Thank you

The way it works from the accounting point of view is:

1. Company was incorporated with £50k shares issued - Now you own £50k worth of shares in the company but owe £50k to the company.

2. The date of investment is when the shares were issued to you. However, the date of investment could very well be deemed as when the first payment was made or even when the last payment was made and £50k were fully paid off to the company.

I don't think Home Office has much expertise in this area and they will accept the date of transfer as the date of first/last payment. You can also put numerous dates on the form (instead of any date), which is what I did, as my director loan was transferred over 5 payments.

If I was you, I would put 'numerous dates' on the form and will ask my accountant to prepare a share certificate, showing the transfers on the certificate.

Thanks dnf for your advice.

I didn't quite understand the last line you said.

I transferred the money in 6/7 transactions. So shall I ask my accountant to prepare 6/7 share certificates or one with whole 50k if one what date should be on the certificate? He already gave me one with 50k on it dated feb 2013 the actual share issuing month.

There are few options I thought of:
1) getting a new 50k share certificate dated oct 2013 (last date of transfer)
2) Put the oct 2013 date on the form without providing any certificate.
3) sending the feb 2013 certificate but putting investment date oct 13 (scared to do it if the case worker sees different dates and rejects)
4) or putting all the dates (don't know what certificate to send)


I would really appreciate your opinion on this matter.

Thank you very much.

If I was you, I would put an October 13 date on the certificate and the form. As mentioned, the possible dates could be the dates shares were issued i.e. February 2013. You do not want to use that date than the dates you could use is the first or last transfer date.

The last transfer date makes more sense as all the £50k were paid and a share certificate was than issued, dated October 13.

You must send the share certificate with your application .

Thank you very much DNF.
I will ask my accountant to do so.

Hello DNF,

I was following this thread as I have similar questions about share certificates. We have invested £200k in form of share capital over 3 years period, we issued shares once in each year and our annual returns were submitted accordingly to update shares record with Companies House, we have just one share certificate with latest share issue date with total amount of share capital, will this be fine?

Do we need multiple shares certificates?

Each year share capital amount has been recorded in annual accounts/management accounts. We have made investment in various transactions and at the end of year we recorded those transactions in annual accounts under share capital in balance sheet.

Thank you.

Helping Person and to everyone else who has questions regarding share certificate

Firstly, please note that, although I am a fully qualified chartered certified accountant and qualified to advice on accountancy and tax matter but due to lack of information or in depth knowledge of your business, I am posting this as generic advice. Your business circumstances could be different so only act on the suggestions after discussing this with your accountant who has in depth knowledge of your business.

Scenario 1

Company incorporated with minimum shares (1 or 100) - money shown in the personal account (£50k - £200k) and initial visa was approved. Now, investment made in 3 installments. The first installment is £10,000. The accountant may have issued 10,000 shares at £1 each and will issue a share certificate showing that you own 10,000 shares by investing £10,000. The next investment of £20,000 and the accountant may have issued 20,000 shares at £1 each and will issue a share certificate showing that you own 20,000 shares by investing £20,000. The next investment of £20,000 and the accountant may have issued 20,000 shares at £1 each and will issue a share certificate showing that you own 20,000 shares by investing £20,000.

Summary - 3 share certificates with different dates showing £50k was invested. This will also reflect on the accounts and on the annual return

Scenario 2

Accountant incorporated the company with 50,000 shares at £1 each for a total of £50,000 as nominal value. However, this £50,000 was paid by you to the company over the initial 6 months after the visa was granted. The best would be to use the last payment date as the date on the form and have the same date on the share certificate