Investing 200K though Holding Company

[9elizabeth]

Hello,
A though just crossed my mind:

How about investing 200K through Share Capital into Holding company (the holding compeny will not trade, it will just be holding company) and then holding company invests into other business as loan.

What are your thought on this investment model?

[noajthan]

Hello,
A though just crossed my mind:

How about investing 200K through Share Capital into Holding company (the holding compeny will not trade, it will just be holding company) and then holding company invests into other business as loan.

What are your thought on this investment model?

What would be the immigration-related purpose of such a complex structure?

[9elizabeth]

Well it is very important from Business point of view. It secures the investment if there is any claim on the company, public liability, and Holding company can be used as special purpose investment vehicle after immigration. All fixed assets such as machinery, commercial premises can be kept on Holding Company name and all liabilities can be kept on another Trading Company. I see lots of benefit doing it though Holding company.

My questions here are-
(1) does it affect the Tier 1 Ent. application extension? Is there anybody else is doing the same.
(2) I can see, the most popular way of investment here is by Director's Loan (and I know the benefits of investment this way). Has anybody invested here into business as Share Capital as 100% Share Capital for £200K?

[zimba]

(1) does it affect the Tier 1 Ent. application extension? Is there anybody else is doing the same.

A holding company is created usually to invest and buy shares of other companies. Given that injected cash in the holding company is effectively used to purchase business(es) from other people, the money invested will not be counted as technically spending your money on previous owners/shareholders of another business(es) are not acceptable forms of investment.

(2) I can see, the most popular way of investment here is by Director's Loan (and I know the benefits of investment this way). Has anybody invested here into business as Share Capital as 100% Share Capital for £200K?

Yes you can but it usually makes no sense to me for a director to buy the shares of his own company (This option is usually used when you invest in other companies). Why invest in such a way that has more tax complications ? Why not inject money that you can take out later easily and tax free ?

[ukbusiness2016]

Hello,
A though just crossed my mind:

How about investing 200K through Share Capital into Holding company (the holding compeny will not trade, it will just be holding company) and then holding company invests into other business as loan.

What are your thought on this investment model?

Hi, I am unable to view private messages, could you just send me your query here?

[9elizabeth]

Hello,

I met a solicitor this morning and he said that the investment of 200K must be completed (transferred into your company) before 12 month of your extension application? Is he right?
I cannot find any reference here. Can someone please tell me if he is right.

[noajthan]

Posts merged.

No need for multiple posts.

[ukbusiness2016]

Hello,

I met a solicitor this morning and he said that the investment of 200K must be completed (transferred into your company) before 12 month of your extension application? Is he right?
I cannot find any reference here. Can someone please tell me if he is right.

You have 3 years to invest the money, I transferred the 200k into my business a year after I got my visa and invested it about 11 months ago so I do not think what the solicitor said is correct.

[seasky]

Hello,
A though just crossed my mind:

How about investing 200K through Share Capital into Holding company (the holding compeny will not trade, it will just be holding company) and then holding company invests into other business as loan.

What are your thought on this investment model?

Hello,
A though just crossed my mind:

How about investing 200K through Share Capital into Holding company (the holding compeny will not trade, it will just be holding company) and then holding company invests into other business as loan.

What are your thought on this investment model?

We have done this model. It is abundantly clear it is not for immigration purposes but for investor purposes (and yes my company has attracted investors from around the world who would not invest in a UK company directly due to onerous tax issues. Our structure also works for the many UK investors we have)

[zimba]

Hello,

I met a solicitor this morning and he said that the investment of 200K must be completed (transferred into your company) before 12 month of your extension application? Is he right?
I cannot find any reference here. Can someone please tell me if he is right.

He is wrong as there is no such requirement. Seems that most solicitors give terrible advice

[seasky]

He is wrong as there is no such requirement. Seems that most solicitors give terrible advice

As someone who was burned very strongly by an immigration solicitor (on something very basic that he should have easily known) any idea why this is? (should be separate thread I know)

[zimba]

As someone who was burned very strongly by an immigration solicitor (on something very basic that he should have easily known) any idea why this is? (should be separate thread I know)

Few reasons;

1. Becoming an immigration advisor is quite easy. Anyone can become a so-called regulated advisor.
2. Law firms and solicitors unsurprisingly want to make as much cash as possible which means they take cases they have no expertise in
3. Many immigration advisors/solicitors usually have very broad understanding of the rules but do not have substantial expertise in specific routes
4. Immigration rules are complex, ambiguous, open to interpretation and change on regular basis. It is difficult to deal with complex cases without facing these challenges