Employee Requirements

[CR001]

Can't see why not. Whether a business is genuine or not has nothing to do with the type of business.

Remember that if you are a Team, both people need to be involved equally in the businesses covering the entire 200K.

I have merged the users topics so that you have the history. Query is for the father.

[Aaina]

Thanks Marcnath. Yes you are right - it's for the father. I am hoping to be co owner of the new limited company and he and I can split up the responsibilities although I am already a resident here.

[marcnath]

Thanks Marcnath. Yes you are right - it's for the father. I am hoping to be co owner of the new limited company and he and I can split up the responsibilities although I am already a resident here.

There is no restriction on you being a co owner. But if your Dad is going to be only a financial partner/investor and not actively involved/contributing to the business, then it is obvious that is not an "entrepreneurial" activity for him - it is an investment activity.

Lot of grey areas here.

[Aaina]

Oh okay,
Thanks for the explanation... Also, if he invests rest of the 50k in a new business, then will he need to wait for a year after the new business is established so that he has the set of accounts? He is already midway in the third year - invested 150k and created two jobs - just the rest of the money that needs to be invested . Thanks

[marcnath]

Oh okay,
Thanks for the explanation... Also, if he invests rest of the 50k in a new business, then will he need to wait for a year after the new business is established so that he has the set of accounts? He is already midway in the third year - invested 150k and created two jobs - just the rest of the money that needs to be invested . Thanks

No, that is not necessary. The accountant can prepare and certify a set of management accounts for any partial period.

[Aaina]

Thank you so much Marcnath.

You are a star!
Regards
Aaina

[Aaina]

Hi,

My father is on Tier 1 Enterpreneur visa and will be finishing his three years in August. In an earlier query, someone said that he can apply for extension anytime after 3 years as long as he is meeting the requirements. He has employed 5 people during this time, although after March he had to furlough the employees due to being in hospitality sector which has the hardest hit.

Employee 1 was employed in January 2019 and Feb 2019 (2months)
Employee 2 was employed from May 2019 to Feb 2020 (10 months) after which he is still here but furloughed.
Employee 3 was employed from May 2019 to July 2019 (3 months) after which he went on sick pay and was on SSP.
Employee 4 was employed from June 2019 to August 2019 (3 months)
Employee 5 has been employed from Sep 2019 to Feb 2019 (6 months) after which have been furloughed

He also has a partner director who takes some sort of directors salary but that director is not on Tier 1 enterpreneur visa. Please note my father has not taken any form of remuneration from the company.

I have a few queries and will be grateful for someone to answer:
- If we combine all these jobs, it easily makes up the two twelve months blocks but can we do that when some of them have been in parallel? employee 1 and 2 can be combined makes 12 months - these are consecutive even though a gap inbetween. Employee 3, 4 and 5 can be combined and makes twelve months but some periods are overlapping.

- Secondly, the other director taking a salary - can her job be shown too as a job creation? also the salary she is taking - would that investment be deducted by the home office when seeing the investment criteria even though she is a British citizen and not a tier 1 entrepreneur applicant. She is just a partner my dad started the business with.

Many thanks
Aaina

[Aaina]

Hi, Please can someone help me with my query.

Many Thanks
Regards
Aaina

Hi,

My father is on Tier 1 Enterpreneur visa and will be finishing his three years in August. In an earlier query, someone said that he can apply for extension anytime after 3 years as long as he is meeting the requirements. He has employed 5 people during this time, although after March he had to furlough the employees due to being in hospitality sector which has the hardest hit.

Employee 1 was employed in January 2019 and Feb 2019 (2months)
Employee 2 was employed from May 2019 to Feb 2020 (10 months) after which he is still here but furloughed.
Employee 3 was employed from May 2019 to July 2019 (3 months) after which he went on sick pay and was on SSP.
Employee 4 was employed from June 2019 to August 2019 (3 months)
Employee 5 has been employed from Sep 2019 to Feb 2019 (6 months) after which have been furloughed

He also has a partner director who takes some sort of directors salary but that director is not on Tier 1 enterpreneur visa. Please note my father has not taken any form of remuneration from the company.

I have a few queries and will be grateful for someone to answer:
- If we combine all these jobs, it easily makes up the two twelve months blocks but can we do that when some of them have been in parallel? employee 1 and 2 can be combined makes 12 months - these are consecutive even though a gap inbetween. Employee 3, 4 and 5 can be combined and makes twelve months but some periods are overlapping.

- Secondly, the other director taking a salary - can her job be shown too as a job creation? also the salary she is taking - would that investment be deducted by the home office when seeing the investment criteria even though she is a British citizen and not a tier 1 entrepreneur applicant. She is just a partner my dad started the business with.

Many thanks
Aaina

[marcnath]

Thanks marcnath,

I was under the impression that the value of a commercial property is classed as an investment if that premise will be used for business. Thanks

Your impression is correct. If you buy a property and use it for Bed and Breakfast, that will be considered an investment. However, if you bought an existing Bed and Breakfast business which included the property, then it would not be.

[Aaina]

Apologies Marcnath,

I had raised a new query a few days ago and it got attached to my previous queries. So I have asked abut the employees..

I will copy it here..

My father is on Tier 1 Enterpreneur visa and will be finishing his three years in August. In an earlier query, someone said that he can apply for extension anytime after 3 years as long as he is meeting the requirements. He has employed 5 people during this time, although after March he had to furlough the employees due to being in hospitality sector which has the hardest hit.

Employee 1 was employed in January 2019 and Feb 2019 (2months)
Employee 2 was employed from May 2019 to Feb 2020 (10 months) after which he is still here but furloughed.
Employee 3 was employed from May 2019 to July 2019 (3 months) after which he went on sick pay and was on SSP.
Employee 4 was employed from June 2019 to August 2019 (3 months)
Employee 5 has been employed from Sep 2019 to Feb 2019 (6 months) after which have been furloughed

He also has a partner director who takes some sort of directors salary but that director is not on Tier 1 enterpreneur visa. Please note my father has not taken any form of remuneration from the company.

I have a few queries and will be grateful for someone to answer:
- If we combine all these jobs, it easily makes up the two twelve months blocks but can we do that when some of them have been in parallel? employee 1 and 2 can be combined makes 12 months - these are consecutive even though a gap inbetween. Employee 3, 4 and 5 can be combined and makes twelve months but some periods are overlapping.

- Secondly, the other director taking a salary - can her job be shown too as a job creation? also the salary she is taking - would that investment be deducted by the home office when seeing the investment criteria even though she is a British citizen and not a tier 1 entrepreneur applicant. She is just a partner my dad started the business with.

Many thanks
Aaina

[Aaina]

Hi,

** Reposting this** as the previous post got attached to my other post.

My father is on Tier 1 Enterpreneur visa and will be finishing his three years in August. In an earlier query, someone said that he can apply for extension anytime after 3 years as long as he is meeting the requirements. He has employed 5 people during this time, although after March he had to furlough the employees due to being in hospitality sector which has the hardest hit.

Employee 1 was employed in January 2019 and Feb 2019 (2months)
Employee 2 was employed from May 2019 to Feb 2020 (10 months) after which he is still here but furloughed.
Employee 3 was employed from May 2019 to July 2019 (3 months) after which he went on sick pay and was on SSP.
Employee 4 was employed from June 2019 to August 2019 (3 months)
Employee 5 has been employed from Sep 2019 to Feb 2019 (6 months) after which have been furloughed

He also has a partner director who takes some sort of directors salary but that director is not on Tier 1 enterpreneur visa. Please note my father has not taken any form of remuneration from the company.

I have a few queries and will be grateful for someone to answer:
- If we combine all these jobs, it easily makes up the two twelve months blocks but can we do that when some of them have been in parallel? employee 1 and 2 can be combined makes 12 months - these are consecutive even though a gap inbetween. Employee 3, 4 and 5 can be combined and makes twelve months but some periods are overlapping.

- Secondly, the other director taking a salary - can her job be shown too as a job creation? also the salary she is taking - would that investment be deducted by the home office when seeing the investment criteria even though she is a British citizen and not a tier 1 entrepreneur applicant. She is just a partner my dad started the business with.

Many thanks
Aaina

[CR001]

Topics Merged. The forum rule has not changed regarding keeping all questions in one topic.

Zimba responded to a similar query earlier today.

https://www.immigrationboards.com/uk-ti ... 04047.html

Yes. Under the COVID relaxation of the Tier 1E rules, you do not need to strictly create two separate positions for 12 months

If you’re on a Tier 1 Entrepreneur visa and your business has been disrupted
You no longer need to employ at least 2 people for 12 consecutive months. The 12 month period you’re required to employ someone for can be made up of multiple jobs across different months.

Time when your employees were furloughed will not count towards the 12 month period.

If you’ve not been able to employ staff for 12 months by the time your visa expires, you’ll be allowed to temporarily extend your stay to give you time to meet the requirement.

These arrangements will continue for applications made after 31 May 2020, where the jobs you’re relying on were disrupted due to coronavirus.

https://www.gov.uk/guidance/coronavirus ... -residents

[Aaina]

Thank you for your reply.

Just that - the link on the reply says -
"If you’re in the UK and your leave expired between 24 January 2020 and 31 July 2020"

This wont be true for my dad right as he is going to apply somewhere in Sep/Oct time or will it still apply? He has a 3.5 year visa till Jan next year, however we were hoping to apply right after he completes 3 years which will be somewhere in Aug/Sep
Or am I just reading the govt link incorrectly..

Thanks:-)
Aaina

[zimba]

You are reading it incorrectly. Each part must be read separately

[marcnath]

Thank you for your reply.

Just that - the link on the reply says -
"If you’re in the UK and your leave expired between 24 January 2020 and 31 July 2020"

This wont be true for my dad right as he is going to apply somewhere in Sep/Oct time or will it still apply? He has a 3.5 year visa till Jan next year, however we were hoping to apply right after he completes 3 years which will be somewhere in Aug/Sep
Or am I just reading the govt link incorrectly..

Thanks:-)
Aaina

The section on the Tier visa has a clear statement "These arrangements will continue for applications made after 31 May 2020..." which overrides the original heading of expiry before 31 July 2020.

However, what you need to pay more attention to is "....where the jobs you’re relying on were disrupted due to coronavirus."

In your Dad's case, I can't see how that would apply since the majority of jobs were not existing at the time of the coronavirus impact. The staff furloughed would not have an effect on the requirement of two jobs (because of the overlap in June/July 2019 the second job only has 10 months FT equivalent)

So, while it is highly probable HO will allow this - for example, in case there were plans to hire someone else for Job 2 and that got disrupted - HO does seem have grounds to refuse the accept the job creation if they want to.

The safest would be hire someone for Job 2 for a couple of months. Next would be to state the fact that there were plans to hire someone to Job 2 and explain the disruption in the cover letter (assuming that was the fact) and lastly to just apply and assume that HO will treat all applications with the more relaxed conditions.

On the Director who is a British citizen and taking a salary, that would be a legitimate job creation. If she was employed throughout, that should satisfy the 2nd job.

[Aaina]

You are reading it incorrectly. Each part must be read separately

Thank you Zimba

[Aaina]

Hi Marcnath,

Thanks for your reply. For job 2 which will be made up of the ones below:

Employee 3 was employed from May 2019 to July 2019 (3 months) after which he went on sick pay and was on SSP.
Employee 4 was employed from June 2019 to August 2019 (3 months)
Employee 5 has been employed from Sep 2019 to Feb 2019 (6 months) after which have been furloughed

I know you cited that there is an overlap and HO will question, but the aim was to have Employee 3 and Employee 5 (in ideal circumstance) but because employee 5 was furloughed due to Coronavirus, we are seeking employee 4's tenure to be added to make up the period. This does indicate that the job of employee 5 has been disrupted and hence we would like to use employee 4's data to meet the requirements to get an extension. If things had been all nice and normal we would have used Employee 3 + employee 5 as by May he would have completed 9 months..but he had to be furloughed after completing 6 months thereby giving us a shortage of 3 months. Disrpution does come into play? isnt it?

Thanks
Aaina

[marcnath]

Hi Marcnath,

Thanks for your reply. For job 2 which will be made up of the ones below:

Employee 3 was employed from May 2019 to July 2019 (3 months) after which he went on sick pay and was on SSP.
Employee 4 was employed from June 2019 to August 2019 (3 months)
Employee 5 has been employed from Sep 2019 to Feb 2019 (6 months) after which have been furloughed

I know you cited that there is an overlap and HO will question, but the aim was to have Employee 3 and Employee 5 (in ideal circumstance) but because employee 5 was furloughed due to Coronavirus, we are seeking employee 4's tenure to be added to make up the period. This does indicate that the job of employee 5 has been disrupted and hence we would like to use employee 4's data to meet the requirements to get an extension. If things had been all nice and normal we would have used Employee 3 + employee 5 as by May he would have completed 9 months..but he had to be furloughed after completing 6 months thereby giving us a shortage of 3 months. Disrpution does come into play? isnt it?

Thanks
Aaina

There is no way I can give any concrete answer or any advice. I can only do my best to interpret HO's guidelines with my own understanding.

As I replied earlier, I think it is highly probable HO will accept your arguments/explanations.

But note that a few things have not changed - HO has only agreed to accept that you can combine JOBS that have not completed 12 months each. I can't say whether Employee 3 and 4 were doing the same job. If they were doing the same job, then the the total number of months that the JOB existed is still only 4 months.
If they were doing different JOBS then there is an argument to use the disruption effect to claim it is 6 months.
The way HO has been primarily defining whether it is the same job or different job has been by how the applicant fills out the Job table.

So, bottom line, this may be acceptable but there are enough loopholes for HO to refuse. My personal opinion is that HO will still be looking at all different aspects of the application and this alone would not be a reason for refusal. But if there are other genuineness concerns, then this will also become an issue.

[Aaina]

Okay, Thanks Marcnath.

I have a few queries as I am getting conflicting advise from some people.

Background - The investment has been made in two companies, 150k in Company A which the father became director of within 3 months of getting his entrepreneur visa and the second one Company B is 55K but that has been started only in March this year.

- The two jobs have been created in Company A and none in Company B. Is that okay? Someone told me that we should have a job in company B as well.

- Company B will only have partial accounts when we submit for extension as it started in March this year and hoping to apply for extension in November time. Is submitting partial accounts an issue? or do they expect an annual compilation.

- Director loan - our accountant was saying that usually its mentioned in the letter by the accountant but I said to him that they need to indicate in the accounts as well, and he was a bit perplexed. Can someone guide me please where in accounts should I tell him to mention it.

Thanks
Aaina

[marcnath]

Okay, Thanks Marcnath.

I have a few queries as I am getting conflicting advise from some people.

Background - The investment has been made in two companies, 150k in Company A which the father became director of within 3 months of getting his entrepreneur visa and the second one Company B is 55K but that has been started only in March this year.

- The two jobs have been created in Company A and none in Company B. Is that okay? Someone told me that we should have a job in company B as well.

- Company B will only have partial accounts when we submit for extension as it started in March this year and hoping to apply for extension in November time. Is submitting partial accounts an issue? or do they expect an annual compilation.

- Director loan - our accountant was saying that usually its mentioned in the letter by the accountant but I said to him that they need to indicate in the accounts as well, and he was a bit perplexed. Can someone guide me please where in accounts should I tell him to mention it.

Thanks
Aaina

The current approach is ok.

Ask the accountant to mention the name in the Notes to the accounts

[Aaina]

Thank you so much Marcnath:-)

[zCIO]

Wanted to share first hand experience:

I invested 200k in my company. Once the money hits your business account from your personal account the investment is done.

Having said that, the money should not be sitting there idle. As Zimba said, you will be scrutinised for genuineness and business activity as you have to pass the genuine entrepreneur test. As long as you have genuine activity, less or more, NOT necessarily you have to spend all the money.

I applied for my extension when I had only spent around 80k, applied for ILR when I had spent around 120k.. rest was still in the business bank account.

Also, I did withdraw minimum director salary through all 5 years and I did NOT top up. My investment was 200k and I took salary from the same amount. As long as the salary is justified e.g. someone withdrawing a salary of 100k a year will raise a red flag otherwise I dont see a problem with a director withdrawing salary.

Director and company are two different entities and the company has to pay for director’s salary to run the business. There seems to be an opinion that director cannot withdraw salary if the company is in loss and can only withdraw from the profit. My company was in loss all 5 years and I withdrew salary all 5 years and did NOT top up the 200k initial investment.

I was granted extension and ILR eventually.

thank you for sharing your information.. really apprecaited. Can you mention the business/industry you established and had a good sales volume with little expense?

[Aaina]

Hi,

In terms of directors loan agreement, I have a query - for the second company which my dad started in March this year, he signed a DLA but since then the address of the company has changed as earlier during the formation the business and residential was the same and since then he has got an office space. Should he create a new DLA showing the new address? He is due to apply for his extension soon.

Thanks
Aaina

[marcnath]

Hi,

In terms of directors loan agreement, I have a query - for the second company which my dad started in March this year, he signed a DLA but since then the address of the company has changed as earlier during the formation the business and residential was the same and since then he has got an office space. Should he create a new DLA showing the new address? He is due to apply for his extension soon.

Thanks
Aaina

No, not really

[Aaina]

Okay Thanks ever so much