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Three business visas to the UK that have replaced a Tier 1 Entrepreneur visa

PUBLISHED: 10 July 2020

The United Kingdom has long become second home for many successful entrepreneurs from all over the world. Such popularity is not only due to high living standards and prestigious educational institutions rich in history. The UK government needs tax revenues from a private sector, and they have created favourable conditions for entrepreneurs:

  • Easy and fast
  • Minimum reporting requirements.
  • Opportunities for tax optimisation.
  • Government schemes to support small- and medium-size businesses.
  • Independent and impartial courts.

Besides, the United Kingdom is conveniently located at the crossroad of the New and Old Worlds which boosts sales markets and creates opportunities for growth. Another advantage is the trust and respect a UK registered company gets from partners and clients. In other words, British government has facilitated everything for you to run and grow a successful business. The question remains, how to get an entrepreneur visa to the UK?

Tier 1 Entrepreneur visa to the UK

An Entrepreneur visa used to be a number one solution for foreign businessmen coming to the UK to do business. Unfortunately, the Home Office closed this category on 29 March 2019. Those who had managed to get it before that can stay in the country and extend their visa.

What were the benefits of a Tier 1 Entrepreneur visa?

  1. You could do any business without prior approval or endorsement from third-party bodies.
  2. Relatively low investment:
    • £200,000 if you invested your own money, or
    • £50,000 if you were sponsored by a venture company, public fund or you had won a tender.
  3. Visa is valid for 3 years and four months. It can be extended for another 2 years or you can switch to any other immigration category.
  4. Opportunity to bring a family to the UK.
  5. Reasonably easy requirements. Key criteria was to have a clear idea of what you are going to do in the UK, have clean criminal record, good health, speak good English and have enough money on the account to maintain yourself and dependants.

бизнес-визы в Великобританию

New visa categories for entrepreneurs

Do not worry if you missed the opportunity to apply for a Tier 1 Entrepreneur visa. The Home Office offers three replacing categories, two new ones and the third existing one that has become a great alternative for businessmen that wish to open a representative office of an overseas company in the UK, either alone or with a partner. You can see all of them in a table below.

Visa categoryWho can apply
Start-up visaBeginner entrepreneurs with a high-potential business idea
Innovator visaExperienced entrepreneurs with a good business idea or planning to expand an existing foreign business
Representative of an Overseas Business visaAmbitious top managers and businessmen that wish to open a representative office of an overseas company in the UK and who are ready to run it

As you can see, each visa serves a different purpose and has its own advantages. But let us start by telling you what unites all these visas.

Start-up, Innovator and Representative visas – common points

  1. All three categories allow you to live and work in the UK for a few years and bring s family with you.
  2. Start-up, Innovator and Representative must manage and grow their own business.
  3. You must speak English at a required level in order to be successful in business.
  4. The Home Office will not give visa to criminals or people with ill health (tuberculosis in particular), so you will need to provide relevant certificates.
  5. The UK government would not support either you or your family; therefore, you need to show you have enough funds to maintain and accommodate yourself and your dependants while you grow your business.

You must have noticed that 3 out of 5 points are requirements of the Home Office to an applicant. Whether or not you will be successful in your application depends on how well you re prepared. If you are unsure you can handle this alone, talk to a qualified lawyer and get professional help.

Новые категории виз на смену визе Предпринимателя

Start-up visa

Start-up visa to the UK is a perfect solution for beginner entrepreneurs. Think about it – the UK authorities do not ask you to invest a big amount of money in your business. Besides, you are free to do a joint venture with one or more partners.

All that matters is your business idea. It must be approved by an authorised body listed on the government website. They must give you an endorsement letter with an assessment of your idea and business.

What are the evaluation criteria for endorsement?

  1. Innovativeness. You cannot join an existing UK business or start something that what is already available in the market.
  2. Viability. Your business plan is realistic and achievable base on resources available to you.
  3. Scalability. Your business must have a potential for growth.

Your endorsing body is responsible for you and they hold you accountable for how well your business is doing; therefore, you must report to them after six and twelve months of obtaining a Start-up visa. If they decide that your results are far from what has been expected, you will have to find another sponsor.

Staying in the UK

A Start-up visa is valid for 2 years and cannot be extended. However, if everything goes to plan and your venture is a success, you can switch to an Innovator visa or an Investor visa.

Innovator visa

An Innovator visa is the closest alternative to a Tier 1 Entrepreneur visa that will soon become a thing of the past. It is designed for experienced entrepreneurs with a good business idea or an existing overseas business that they want to expand to a high-potential UK market.

An advantage of an Innovator visa is that you only need to have access to £50,000 (instead of £200,000) that you will invest in a business. If you are forming an entrepreneurial team, each partner must contribute £50,000.

There is another difference between the two visas relating to what your business will do in the UK. Similar to Start-up visa requirements, you will need an endorsement letter from an authorised body. You will be assessed against the same criteria, innovativeness, viability and scalability. You will be required to report to your sponsor after 6, 12 and 24 months of getting a visa.

Staying in the UK

Unlike a Start-up visa, an Innovator visa is valid for 3 years and can be extended. You can apply for extension either with the existing business that you opened or start a new endorsed project by again investing £50,000.

If you have had good relations with the endorsing sponsor, your UK company complies with at least 2 out of 7 criteria and you have spent most of the time in the UK running a business,  you are eligible to apply for UK permanent residence. Your family members can also apply with you provided they have passed an English test and a Life in the UK test.

This article will tell you more about what criteria you must comply with in order to apply for settlement, or an indefinite leave to remain, in the UK.

Representative of an Overseas Business visa

Roughly speaking, a Sole Rep visa is more of a work visa. Representative are employees of a UK company but employed by an overseas company that is opening an office in the United Kingdom and sends you there in your role of a top manager to run the UK business. You can also be a co-owner of an overseas business and wish to try your luck on a new market.

Apart from above mentioned requirements, the Sole Rep would need to comply with the following:

  • Relevant
  • Top management role in an overseas business.
  • Not being a majority shareholder in the parent company.

There is no need to report to an endorsing body or look for a sponsor. Still, your business will be subject to assessment by the Home Office and a good business plan will help you persuade them about your intentions.

Staying in the UK

Representative of an Overseas Business visa is granted for 3 years subject to extension for another 2 years. After 5 years of legally living in the UK, you can apply for settlement and a year later for naturalisation and a British passport.

Виза Единственного представителя – Sole Representative Visa

Conclusion

All changes in the UK Immigrations Rules in relation to foreign entrepreneurs have one purpose, to make sure that new businesses generate value for the society and offer new products and services.

Irrespective of why you decide to start a business in the United Kingdom, you must prepare your application for a business visa well. Immigration lawyers at Imperial & Legal have relevant experience in dealing with such matters and will be able to help you at each stage of application process as well as register a UK company, open a bank account and solve other business-related issues in the UK.

FAQ about UK entrepreneur visas

What are the requirements of the Home Office for extension of Entrepreneur visa?

As is well-known, from 29 March 2019, Tier 1 Entrepreneur visa route has been closed. However, those who had had their visa granted before that date can still extend in three years’ time if they meet the following criteria:

  • You must apply for extension before the expiration date of your entry visa.
  • You got registered as self-employed or the head of your own company within six months from getting permission to enter the UK as an Entrepreneur.
  • Depending on the source of financing, you must have invested into 1 or several British companies from £50,000 to £200,000.
  • Your business activity must result in the minimum of 2 full-time jobs for permanent residents and citizens of the UK. The jobs must have existed for at least 12 months.
  • You can give documentary proof of the fact that 3 months prior to applying for extension you still were the head of your company, a member of partnership or a self-employed entrepreneur.
  • You can financially support yourself and dependants.

Your spouse, minor children and children who came of age while living with you in the UK must be included in your application.


Which of the new visa routes resembles Tier 1 Entrepreneur visa most?

Innovator visa is designed for experienced businessmen and, it would seem, resembles the abolished Tier 1 Entrepreneur visa. The evident advantage of the new visa for entrepreneurs is a more reasonable sum of necessary investment. The minimum amount the innovator must invest is only £50,000, which is considerably less than £200,000 required under the abolished visa.

You must prove to the British authorities that a new business idea will benefit the national economy, that is why innovators are required to get endorsement from one of the approved bodies and to report to the endorsing body until Indefinite Leave to Remain (ILR) is granted.

To get endorsed by an approved body, your business idea must meet three simple criteria: it must be innovative, viable and scalable. In other words, your product must be truly new on the large British market and you must have enough knowledge, experience, motivation and financial resources to ensure successful functioning and growth of your business.


Why can UK Start-up visa and Innovator visa holders lose support of the approved body and what is to be done about it?

Endorsing bodies were designed as an efficient instrument of public control of new business entities emerging on the British Isles. The British authorities hope to use it as one stone to kill two birds:

  • Reduce the number of shell companies, which are registered with the sole purpose of obtaining UK residence.
  • Increase the inflow of capital and promising ideas into the real sector of the British economy.

Commonly, the representatives of an approved body take their work most serious, so foreign entrepreneurs may lose the endorsement, should they not comply with the requirements for their visa.

Less commonly, you may lose your endorsement if your endorsing body is removed from the approved list. Over the last years inspection of functioning and decisions of the approved bodies has begun to seem necessary to the British government.

If your endorsement has been withdrawn, the best possible solution is to approach experts. Qualified experts from Imperial & Legal will assist you in eliminating problems which have caused losing of your endorsement in a timely manner and you will without delay receive another endorsement letter from another approved body.


What are the benefits of a UK Sole Representative visa?

UK Sole Representative visa  is an ideal solution for a top manager of a company registered and trading abroad and planning to set up its representation in the UK. The main thing for the applicant is not to own more than 50% shares of the parent company.

The UK Sole Representative visa route will allow you to relocate to the UK and to dedicate yourself to developing the subsidiary of a successful foreign company. Nearly all the related costs will be borne by the head office.  And in contrast to other business visa holders there is no need for you to report to anyone but the HMRC and the Companies House.

However, first of all you need to prove to the Home Office that you have a firm commitment. You must have a relevant education and experience as a top-manager in the parent company. Another strong argument for the Home Office is a well-prepared business plan.

Experts of Imperial & Legal provide support on visa-related issues to prospective sole representatives up to drafting a business plan. Besides, we offer a number of incorporation packages for those who are just starting their business activity in the UK. If you want to make an enquiry, book a consultation with our expert.

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