Tier 1 Entrepreneur (Mode of Investment)

[SAB0001]

Dear All

I am now approaching my Tier 1 Entrepreneur extension but need some clarification on the acceptance of my investment.

I invested in an accountancy firm and did this by paying goodwill (worth more than £ 200K) to the partners of this firm. The money was paid into the partners personal bank account.
In return of this payment I became a director of the firm and this appointment as a director has been registered with the companies house.

These terms were stipulated in a business plan which I had submitted to the Home Office when I first applied for Tier 1 Entrepreneur VISA.

I am concerned that the Home Office will query this when I apply for the extension.
My friends and colleagues tell me that the money should have been invested into the comapny's Business Bank account and not into director's personal accounts but I am surprised this was not queried when I first applied and as I said it was clearly stated in the Business Plan submitted to the Home Office.

Is there anyone who has been through a similar situation?
Any experienced opinion on this will be greatly appreciated.

Many Thanks

[marcnath]

If the payment was paid to the firm's partners, then how do you intend to show the evidence which is stipulated for the investment ?

I am sorry that this would not be what you want to hear, but it is almost certain you will not get points for investment.

The fact that it was in the business plan is not a defence, unfortunately.

In fact, it is worse in that, unless you had access to another 200K, you are in violation of the terms of your initial grant - which is that you should have access to the funds until it is invested (and that definition of investment is what excludes the goodwill payment). That means, the HO can curtail your initial grant.

The only positive thing I can say is that I don't see that exact language in the Immigration rules itself (I could be wrong).The guidelines are not law and the decisions should be made on the rules rather than the guideline. So, talk to a solicitor to see if that can be used as an argument.

I am sure you have seen the following paragraph from the guideline:

‘Invested’ means that the funds have been put into businesses which you are running as self-employed or as a director or partner . ‘Invested’ or ‘spent’ excludes spending on:
1) your own remuneration,
2) buying the business from a previous owner, where the money ultimately goes to that previous owner (irrespective of whether it is received or held directly or indirectly by that previous owner) rather than into the business you have bought. This applies regardless of whether the money is channelled through the business en route to the previous owner. For example, by means of you or your business purchasing ‘goodwill’ or other assets which were previously part of the business you have bought,

[SAB0001]

thanks for the expert advise.