Keep £200k in bank account until spent on business.

[sunnystar]

Hi guys I've been a silent reader most of time and I am very grateful for the valuable information on this forum.

I just realized this new rule (keep £200k in bank account until spent) was inserted into the rules January 2013. I copied the relevant rules below for your reference.

My scenario is I obtained Entrepreneur visa in 2012. I have invested £200k into a residential property (rented out at the moment), although I am looking to use it as an office in future.

My questions are:

1. Will this investment be counted as "spent on business" even if it's a residential property?

2. Do the current rules apply to my visa which was issued in 2012? Must I keep £200k in my bank account to avoid curtailment of my visa?

Thanks a lot guys.


245DE(c) Without prejudice to the grounds for curtailment in paragraph 323 of these Rules, leave to enter or remain granted to a Tier 1 (Entrepreneur) Migrant may be curtailed if:

(ii) the funds referred to in the relevant sections of Appendix A cease to be available to him, except where they have been spent in the establishment or running of his business or businesses. 'Spent' excludes spending on the applicant's own remuneration. 'Available to him' means that the funds are:

(1) in his own possession,...

http://www.ukba.homeoffice.gov.uk/polic ... es/part6a/

[geriatrix]

1. No, because becoming a landlord is not an acceptable business in this category. Read 56-57.
2. Yes I believe, read 30.

Also, you will need local council's permission to convert a residential dwelling into business/commercial premises. Sort of impossible in a residential area, AFAIK.

[rahulsingh1]

Hi SunnyStar and SushDmehta - This has been discussed before when they released the new rules.

The full text in Part6A is the following:

(ii) the funds referred to in the relevant sections of Appendix A cease to be available to him, except where they have been spent in the establishment or running of his business or businesses. 'Spent' excludes spending on the applicant's own remuneration. 'Available to him' means that the funds are:

(1) in his own possession,

(2) in the financial accounts of a UK incorporated business of which he is the director, or

(3) available from the third party or parties named in the application under the terms of the declaration(s) referred to in paragraph 41-SD(b) of Appendix A.


Now I would like to make TWO points in this regard.

1) It is extremely difficult for them (UKBA) to check continuously all round the 3 years of your visa validity as to whether you have access to funds or not! Its not practical in practice for them to do that. They are already over loaded with clearing applications.

2) SunnyStar- you did not mention Point3 in your post Above.You stopped at point 2. Point 3 says, that the money can also be kept available from the third-party till the investment is made. -- So the money does not necessarily need to be in your or your business's bank account. It can remain with the third party all the while as well.

Hi guys I've been a silent reader most of time and I am very grateful for the valuable information on this forum.

I just realized this new rule (keep £200k in bank account until spent) was inserted into the rules January 2013. I copied the relevant rules below for your reference.

My scenario is I obtained Entrepreneur visa in 2012. I have invested £200k into a residential property (rented out at the moment), although I am looking to use it as an office in future.

My questions are:

1. Will this investment be counted as "spent on business" even if it's a residential property?

2. Do the current rules apply to my visa which was issued in 2012? Must I keep £200k in my bank account to avoid curtailment of my visa?

Thanks a lot guys.


245DE(c) Without prejudice to the grounds for curtailment in paragraph 323 of these Rules, leave to enter or remain granted to a Tier 1 (Entrepreneur) Migrant may be curtailed if:

(ii) the funds referred to in the relevant sections of Appendix A cease to be available to him, except where they have been spent in the establishment or running of his business or businesses. 'Spent' excludes spending on the applicant's own remuneration. 'Available to him' means that the funds are:

(1) in his own possession,...

http://www.ukba.homeoffice.gov.uk/polic ... es/part6a/

[geriatrix]

I think you are missing the point that OP has used up the investment funds (£200K) in buying a residential property and becoming a landlord!

AIUI, this doesn't meet any of the three conditions under 245HD(e).

Unless he sells his property, he has no funds to invest .... or he has another £200K sitting somewhere (with him or his rich relatives)?

[rahulsingh1]

Yep for this particular case you are right!

But there is one solution though.

If SunnyStar can make the property his office(make it look like it at-least!) with office furniture etc. And get it surveyed and verified by the royal surveyors(as mentioned in policy guidance), and they will state that the whole property is being used for the company(or Work!). Then it will be counted as investment.

It does not necessarily need to be commercial property! Just the survey report should say that it is being used for the business you have established.

I think you are missing the point that OP has used up the investment funds (£200K) in buying a residential property and becoming a landlord!

AIUI, this doesn't meet any of the three conditions under 245HD(e).

Unless he sells his property, he has no funds to invest .... or he has another £200K sitting somewhere (with him or his rich relatives)?

[sunnystar]

Thank you guys for your comments!

Just want to confirm the new rule does apply to my visa even if it was issued in 2012?

It seems extremely unfair because there wasn't such a rule when my visa was issued. I would have never known the new rule if I didn't look at UKBA's website by chance more than a year after my application.

[geriatrix]

No wonder there are so my applications being refused! People just don't get it!

So, you are suggesting that the OP invests the entire £200K in purchasing an office and UKBA will be okay with it - where not even a penny has been invested in actually becoming an entrepreneur!!

Moreover, no "chartered" surveyor worth his name will certify a residential dwelling as a commercial property. What is mentioned in the policy guidance is that any space (room(s)) being used for business operations must be surveyed by a chartered surveyor to calculate the proportional cost of that (commercial / business) space that can then be used as one "spent on / invested in business".

[MTZ510]

Can UKBA access our accounts to know the balance? i dont think they have authority to do that and the banks will never disclose clients information to UKBA.

[geriatrix]

I am sure if 245HD(e) has been added to the immigration rules, there must be a way for UKBA to find out what they may need to find out at any stage of the applicant's stay in the UK. Clause 30 of the policy guidance does seem to suggest so.

Anyway, every applicant signs "consent to verification checks" in the application form. So, even if UKBA cannot figure it all out during the time of stay in the UK, they can definitely find out every detail about the preceding stay when an application is made for extension. So, even if curtailment is not possible during the time window between entry and extension, it can definitely be imposed at the time of extension.

IMHO ...

[sunnystar]

I am sure if 245HD(e) has been added to the immigration rules, there must be a way for UKBA to find out what they may need to find out at any stage of the applicant's stay in the UK. Clause 30 of the policy guidance does seem to suggest so.

Anyway, every applicant signs "consent to verification checks" in the application form. So, even if UKBA cannot figure it all out during the time of stay in the UK, they can definitely find out every detail about the preceding stay when an application is made for extension. So, even if curtailment is not possible during the time window between entry and extension, it can definitely be imposed at the time of extension.

IMHO ...

Yes we did signed the consent to verification check.

Will this new rule be applicable to visas issued in 2012?

[sunnystar]

If the whole £200k has not been available to me for the whole period of my visa, would that be a violation of immigration law?

Taking into account the rules were inserted in January 2013, it will be very difficult for existing visa holders to even notice them.

Thank you guys.

[rahulsingh1]

No idea. UKBA has always been erratic in their policies.

But you have to give credit to school leavers working for the UKBA for coming up with atleast this much content!

If the whole £200k has not been available to me for the whole period of my visa, would that be a violation of immigration law?

Taking into account the rules were inserted in January 2013, it will be very difficult for existing visa holders to even notice them.

Thank you guys.