Tier 1 Entrepreneur and employement

[khizar18]

Hi to all,
Below is the timeline from initially getting the visa till date:
Oct 2015 granted T1 Ent (£200,000) visa back home
Nov 2015 landed UK
Dec 2015 Company opened and I was appointed as a Director of the company and funds (£200,000) were transferred from back home personal account into my UK personal account and further transferred into my company bank account by end of 2015.
Whole year of 2016 was difficult and brought many ups & downs in terms of trading & running the business as I was being cheated by two (European & UK nationals) with £25,000. However, in February 2017, I started trading through the same company opened in Dec 2015. The company was never been on dormant status during 2016 as I was filing the returns (NIL) on time through my accountant though I was not doing any business/trading.
Within two months (from February 2017), I realised that I would require a retail outlet aswel to support my wholesale electronics business. Therefore, I acquired a running retail business in April 2017.
I acquired the business for £20,000 premium and transferred further £60,000 into the acquired business bank account for stock purchase & renovation purpose making the total investment in the acquired business £80,000 and keeping £120,000 in my wholesale (first company bank account) company for the trading activities. My retail outlet maintains stock value of £50,000 all the time and the wholesale business rolls up £120,000 (keeping £40,000 of stock in hand all the time).
July 2017, I’ve appointed a British national as my first employee under wholesale company (first company) which is VAT registered too. Furthermore, in Sept 2017, I’ve appointed a European national living in UK for my second company (retail outlet). In Nov 2017, I’ve appointed a second employee (British National) for my first company (wholesale) and in Dec 2017, I’ve appointed second employee (ILR status) for my second company (retail outlet).
My company (wholesale) purchases approx £ 30,000 to £40,000 of stock on monthly basis and file returns on quarterly basis paying approx £3,000 to £4,000 tax (maintaining all the VAT certificates received from HMRC) and maintaining clientele of 10 to 15 retail companies who buy stock from my wholesale unit. My employees get salaries on time and through bank transfers and both the companies pay NIC and other related taxes on time and through company bank accounts to HMRC.
My first extension is due in January next year. My concern and question to the experience people is as under:
1. Whether my investments in two businesses are ok? I mean the way the amounts have been invested.
2. Do I have to stick with the same employees until 12 months completed or I can appoint someone new UK national or ILR (for example from 1st April 2018) who is more beneficial for my business in terms of growth? As I am not satisfied with the performance of the employee under my wholesale company appointed in Nov 2017.
3. Can I appoint someone on spouse visa too and if it would serve the requirement of having atleast two full time employees.
4. Can I keep one UK national in wholesale company and one UK national in retail outlet and will it serve the requirement of having two full time employees but one each in two companies?

Looking forward to your valuable replies.

[marcnath]

Hi to all,
Below is the timeline from initially getting the visa till date:
Oct 2015 granted T1 Ent (£200,000) visa back home
Nov 2015 landed UK
Dec 2015 Company opened and I was appointed as a Director of the company and funds (£200,000) were transferred from back home personal account into my UK personal account and further transferred into my company bank account by end of 2015.
Whole year of 2016 was difficult and brought many ups & downs in terms of trading & running the business as I was being cheated by two (European & UK nationals) with £25,000. However, in February 2017, I started trading through the same company opened in Dec 2015. The company was never been on dormant status during 2016 as I was filing the returns (NIL) on time through my accountant though I was not doing any business/trading.
Within two months (from February 2017), I realised that I would require a retail outlet aswel to support my wholesale electronics business. Therefore, I acquired a running retail business in April 2017.
I acquired the business for £20,000 premium and transferred further £60,000 into the acquired business bank account for stock purchase & renovation purpose making the total investment in the acquired business £80,000 and keeping £120,000 in my wholesale (first company bank account) company for the trading activities. My retail outlet maintains stock value of £50,000 all the time and the wholesale business rolls up £120,000 (keeping £40,000 of stock in hand all the time).
July 2017, I’ve appointed a British national as my first employee under wholesale company (first company) which is VAT registered too. Furthermore, in Sept 2017, I’ve appointed a European national living in UK for my second company (retail outlet). In Nov 2017, I’ve appointed a second employee (British National) for my first company (wholesale) and in Dec 2017, I’ve appointed second employee (ILR status) for my second company (retail outlet).
My company (wholesale) purchases approx £ 30,000 to £40,000 of stock on monthly basis and file returns on quarterly basis paying approx £3,000 to £4,000 tax (maintaining all the VAT certificates received from HMRC) and maintaining clientele of 10 to 15 retail companies who buy stock from my wholesale unit. My employees get salaries on time and through bank transfers and both the companies pay NIC and other related taxes on time and through company bank accounts to HMRC.
My first extension is due in January next year. My concern and question to the experience people is as under:
1. Whether my investments in two businesses are ok? I mean the way the amounts have been invested.

Generally seems ok. I assume the 20k premium went to the existing owner of the business so unless it was paid from the sales revenue of the 1st business, it will be deducted from your 200k

2. Do I have to stick with the same employees until 12 months completed or I can appoint someone new UK national or ILR (for example from 1st April 2018) who is more beneficial for my business in terms of growth? As I am not satisfied with the performance of the employee under my wholesale company appointed in Nov 2017.

No you don’t need to. You need to maintain 2 jobs for 12 months. Assuming your first employees in each company are still working, they will make up you will meet the requirement with those two employees anyway.

3. Can I appoint someone on spouse visa too and if it would serve the requirement of having atleast two full time employees.

No, someone on spouse visa is not a settled worker.

4. Can I keep one UK national in wholesale company and one UK national in retail outlet and will it serve the requirement of having two full time employees but one each in two companies?

Yes , you can.
But since you acquired the second business, the job created has to be in addition to any existing jobs before your acquisition. That is, there should be a net increase in employment

[khizar18]

Hi to All,

My retail unit doesn’t have UK national as employee; perhaps, he’s on spouse visa. However, my wholesale business has two UK national employees:
1. First employee – 01/07/2017 till date (Sales Job, 15 months)
2. Second Employee – 01/11/2017 to 30/04/2018 (Sales Job, 6 months)
3. Third Employee – 01/05/2018 till date (Sales Job, 5 months)
The first employee has decided to open his own business as he got a better idea of this business now after working in my company and now he has resigned (15 months) and 30 Sept 2018 would be his last day. However, the third and the only employee in my wholesale business would continue his employment for two years as I made a contract with him.
The question is:
A. Is the requirement of two settled employees according to T1 Ent visa during the 12 months period fulfilled as per above scenario or should I look for another employee before the first employee leave i.e. 30 Sept 2018.
B. I am worried whether as per above situation, am I fulfilling the requirement of T1 ent employment condition or not?

Please guide.

[khizar18]

Any expert advice ????

[marcnath]

Hi to All,

My retail unit doesn’t have UK national as employee; perhaps, he’s on spouse visa. However, my wholesale business has two UK national employees:
1. First employee – 01/07/2017 till date (Sales Job, 15 months)
2. Second Employee – 01/11/2017 to 30/04/2018 (Sales Job, 6 months)
3. Third Employee – 01/05/2018 till date (Sales Job, 5 months)
The first employee has decided to open his own business as he got a better idea of this business now after working in my company and now he has resigned (15 months) and 30 Sept 2018 would be his last day. However, the third and the only employee in my wholesale business would continue his employment for two years as I made a contract with him.
The question is:
A. Is the requirement of two settled employees according to T1 Ent visa during the 12 months period fulfilled as per above scenario or should I look for another employee before the first employee leave i.e. 30 Sept 2018.
B. I am worried whether as per above situation, am I fulfilling the requirement of T1 ent employment condition or not?

Please guide.

There is no requirement of the highlighted portion above.

The requirement is that you have two jobs, each of 12 months.

It looks like your employee 1 fulfils Job 1 for more than 12 months, so that satisfies one job
The second job is filled by employee 2 for 6 months and employee 3 will be there for another 8 months or more, so that would meet your 2nd job.

[khizar18]

"The second job is filled by employee 2 for 6 months and employee 3 will be there for another 8 months or more, so that would meet your 2nd job".

Regarding your above reply, The second employee worked in my company for 6 months and resigned and the third employee started from the next day of the last day of second employee. Why would the third employee has to complete another 8 months when the 2 jobs created have to complete 12 months (atleast).

The jobs were created but if somebody leaves in between the 12 months and you appoint a new person for the same job, the new person doesn't have to complete another 12 months rather should be ok to complete the 12 months period left behind by the resigned employee (second employee).

This is my understanding from the guideline of T1 Ent Extension (first). Please correct me if I am wrong or missing any point.

[marcnath]

"The second job is filled by employee 2 for 6 months and employee 3 will be there for another 8 months or more, so that would meet your 2nd job".

Regarding your above reply, The second employee worked in my company for 6 months and resigned and the third employee started from the next day of the last day of second employee. Why would the third employee has to complete another 8 months when the 2 jobs created have to complete 12 months (atleast).

The jobs were created but if somebody leaves in between the 12 months and you appoint a new person for the same job, the new person doesn't have to complete another 12 months rather should be ok to complete the 12 months period left behind by the resigned employee (second employee).

This is my understanding from the guideline of T1 Ent Extension (first). Please correct me if I am wrong or missing any point.

You are right - employee 3 only needs to be there for 6 months to meet the requirement.

Based on your timing and statement that the employee 3 is committed for 2 years, I expected that person to have completed 8 months or so at your application time, meeting well more than the requirement.

[khizar18]

Got T1 ent extension within one and a half month. Thanks to all expert advices.