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Tier 1 Extension 200K Route

Only for UK Tier 1 (Entrepreneur) points system. This route is now closed to new applicants.

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teddybear79
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Tier 1 Extension 200K Route

Post by teddybear79 » Mon Mar 14, 2022 5:37 pm

investment :

if the money went into a business account and the previous owners withdrew it then that I| an acceptable investment. if you directly paid them outside the business in personal accounts then I am sorry that cannot be counted. let's make an assumption.

you purchased ABC company and deposited funds into abc company account the old owners then withdraw the money this is acceptable


Employees, how did you take over the business, same limited company or a new limited company. ?

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marcnath
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Re: Tier 1 Extension 200K Route

Post by marcnath » Tue Mar 15, 2022 4:42 am

Do not tag you question to other user's posts.

Money that ends up with the owner is not considered an investment into the business - does not matter if it is just passed through company bank account.

Of course the question is how HO will find out - but that is a risk you take.
My comments are in no way meant to be advisory. I have no professional knowledge of immigration. These are based on my own experience, convictions and personal interpretation of publicly available information.

teddybear79
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Re: Tier 1 Extension 200K Route

Post by teddybear79 » Sat Mar 19, 2022 5:02 pm

Sorry to say Sir you are 100% wrong if the money is passed thru the company it is an investment :-) I did it and was granted it. let me explain the logic.

Mr. A puts 10K into the company and MR B takes it out what will the company accounts show :-)

Investment of MR A = 10K as far as MR B taking money is concerned it will be either

against Salary, DL, or Loan that's MR B problem, not MR A as he has invested how MR B has taken it out of company is MR B and HMRC problem MR A investment will be shown in accounts

Please if you are not sure ask someone don't misguide others

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marcnath
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Re: Tier 1 Extension 200K Route

Post by marcnath » Wed Mar 23, 2022 7:40 am

teddybear79 wrote:
Sat Mar 19, 2022 5:02 pm
Sorry to say Sir you are 100% wrong if the money is passed thru the company it is an investment :-) I did it and was granted it. let me explain the logic.

Mr. A puts 10K into the company and MR B takes it out what will the company accounts show :-)

Investment of MR A = 10K as far as MR B taking money is concerned it will be either

against Salary, DL, or Loan that's MR B problem, not MR A as he has invested how MR B has taken it out of company is MR B and HMRC problem MR A investment will be shown in accounts

Please if you are not sure ask someone don't misguide others
You should take your own advice and not misguide others.
You should also read the post carefully before shooting it down.

As I said, there is a question how HO can find out whether the money went to the previous owner if you route it through the business account. Which is what probably happened in your case. It is very difficult (but not impossible) for HO to dig into the accounts and bank statements. But if they had, that investment would have been discounted.

But that does not change the fact. The immigration rules just imply that money going to the previous owner is not counted.

In fact, if you read the guidance properly, it says:
Money deposited in a bank account, even if it is in a United Kingdom business bank account, is not
counted as investment in business. The money should be used in the business, for example to
encourage growth or expansion, or to improve services or products.


While there is no requirement to provide evidence of how money is used (it is not very practical), it is clear that the intent is an important criteria for investment.

Consider yourself lucky that your extension was approved. HO retains the right to revoke it if they become aware of your payments having gone to the previous owner.
My comments are in no way meant to be advisory. I have no professional knowledge of immigration. These are based on my own experience, convictions and personal interpretation of publicly available information.

teddybear79
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Re: Tier 1 Extension 200K Route

Post by teddybear79 » Wed Mar 23, 2022 7:14 pm

get yourself life, so you are saying that if I invest 100K in a business and my partner withdraws the money against salary/director loan investment will not be counted?

I am rolling the floor laughing.

As far in my case, I declared in a covering letter that I overtook a business and old owners to withdraw money against DL and then retired. lol again laughing on the floor :-)

teddybear79
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Re: Tier 1 Extension 200K Route

Post by teddybear79 » Wed Mar 23, 2022 7:21 pm

as per your logic, nothing is an investment like I go to curry pc world and buy 10 laptops for my business the money goes to previous owners of laptops opps this is not an investment

I want to buy a warehouse for business, I paid the previous owner's opps it's not an investment .

this clause was added in 2014 - 2015 as people were abusing the system, especially 50K students by buying business from relatives with 0 value at inflated prices.

another important thing for your little knowledge so you are saying that we cannot open a franchise or invest in a running business under t1?

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marcnath
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Re: Tier 1 Extension 200K Route

Post by marcnath » Thu Mar 24, 2022 9:44 am

Glad that I brought some joy into your life. Laughter is good for your health and well being.

Having said that, please be respectful to others in this forum.

Reading your replies, it looks like there is a big misunderstanding.

So, for the benefit of other users of this forum, let me clarify.

The condition is that the money you pay to the previous owner in order to buy the business from him/her is excluded from your investment.

The logic is very simple - the intent of the investment and job criteria in the T1E visa is to get additional investment and jobs into UK businesses. Payment for purchase of a business does not meet that intent if all it does is give that money to an individual.

So, if you agree with the previous owner that the purchase price is 100K, just running it through the business account does not allow you to sidestep that condition. Incidentally, trying to account that payment in your business accounts is a whole other challenge.

The examples you then use do not fit into the above criteria.

- if the previous owner is your partner in the business, then he/she is continuing either as a owner (so not previous) or as an employee. Payment for either of those roles is fine.
- as to laptops and warehouse purchase, you seem to have confused previous owner of the business you took over with previous owner of the goods. Apples and oranges, I am afraid.
My comments are in no way meant to be advisory. I have no professional knowledge of immigration. These are based on my own experience, convictions and personal interpretation of publicly available information.

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marcnath
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Re: Tier 1 Extension 200K Route

Post by marcnath » Thu Mar 24, 2022 9:57 am

teddybear79 wrote:
Wed Mar 23, 2022 7:14 pm

As far in my case, I declared in a covering letter that I overtook a business and old owners to withdraw money against DL and then retired.
Let me understand this correctly.

The previous owners had made a DL to the business.

You put money into the business account. The business then paid back the loan owed to the previous owners?

If so, that is an interesting way of structuring the takeover of a business.

Do I understand this correctly or ... ?
My comments are in no way meant to be advisory. I have no professional knowledge of immigration. These are based on my own experience, convictions and personal interpretation of publicly available information.

teddybear79
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Re: Tier 1 Extension 200K Route

Post by teddybear79 » Thu Mar 24, 2022 9:47 pm

if you put money into a company account how can previous owners take it out? it's now company money, not my or existing owners?

The problem is most of people here do not even understand company is a entity it self and you do not own company assets / cash . company owns it

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marcnath
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Re: Tier 1 Extension 200K Route

Post by marcnath » Mon Mar 28, 2022 7:35 am

teddybear79 wrote:
Thu Mar 24, 2022 9:47 pm
if you put money into a company account how can previous owners take it out? it's now company money, not my or existing owners?

The problem is most of people here do not even understand company is a entity it self and you do not own company assets / cash . company owns it
Now I suspect most readers will be confused.

Your original post said
"if the money went into a business account and the previous owners withdrew it then that it is an acceptable investment."

Now you are saying that is not possible for previous owners to withdraw it.

So which is it? It would help if you make clear statements rather than rhetorical ones.
My comments are in no way meant to be advisory. I have no professional knowledge of immigration. These are based on my own experience, convictions and personal interpretation of publicly available information.

teddybear79
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Posts: 224
Joined: Mon Jan 27, 2014 10:20 am

Re: Tier 1 Extension 200K Route

Post by teddybear79 » Tue Mar 29, 2022 2:49 pm

if you have no accounting/business knowledge please do not advise people on this topic.

read carefully

ABC company was on sale and teddy purchased it for 100K, but teddy could not pay the seller directly as then it would not count as an investment under his T1 visa conditions. so

Teddy invested 100K into ABC company, via share capital, and old owners who had pending DL with the company withdrew the money. this made both teddy and the old owners happy as if teddy would have paid them directly then they would have to pay a hefty capital gain tax.

I hope I am clear?

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marcnath
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Re: Tier 1 Extension 200K Route

Post by marcnath » Wed Mar 30, 2022 9:33 am

teddybear79 wrote:
Tue Mar 29, 2022 2:49 pm
if you have no accounting/business knowledge please do not advise people on this topic.

read carefully

ABC company was on sale and teddy purchased it for 100K, but teddy could not pay the seller directly as then it would not count as an investment under his T1 visa conditions. so

Teddy invested 100K into ABC company, via share capital, and old owners who had pending DL with the company withdrew the money. this made both teddy and the old owners happy as if teddy would have paid them directly then they would have to pay a hefty capital gain tax.

I hope I am clear?
Would I be right in assuming you first signed a purchase agreement with the old owners which set this mechanism out?

Can I also check - if you invested as Share Capital, what happened with the shares the previous owners had. Are they still holding those?
My comments are in no way meant to be advisory. I have no professional knowledge of immigration. These are based on my own experience, convictions and personal interpretation of publicly available information.

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