Tier 1 200k extension due in march 2016 help needed

[regularuser]

Hello everyone,

I am regularly reading post from other users and getting a info about my extension.

I have seen my solicitor for extension application and pointed out some point which bit confusing me.

1) he asked companies all bank statement since we started bcoz he wants review for all the statements for 200k investment purpose.

2) he also told me that you have to make 200k investment plus your Director salary e.g. 200k investment + director salary paid in 3 years.

Can somebody put light on this topic as director i have drawn salary in my person account and paid my personal bills and expenses and remainder give it to the Company as a Director Loan.

Much appreciate your advise.

[zimba]

Hello everyone,

I am regularly reading post from other users and getting a info about my extension.

I have seen my solicitor for extension application and pointed out some point which bit confusing me.

1) he asked companies all bank statement since we started bcoz he wants review for all the statements for 200k investment purpose.

2) he also told me that you have to make 200k investment plus your Director salary e.g. 200k investment + director salary paid in 3 years.

Can somebody put light on this topic as director i have drawn salary in my person account and paid my personal bills and expenses and remainder give it to the Company as a Director Loan.

Much appreciate your advise.

1. You need to send all the business bank statements which show you personally transferred at least 200K to your business. If you done it in multiple steps, you have to show multiple statements covering 200K.

2. The rules and the guide are very clear on this. Your 200k must be invested in the company to be spent as business expenses (employee salary, taxes, utilities, purchases, rent, fees, assets, etc) BUT you cannot pay any salary to yourself from your 200k as it will NOT be counted towards your investment. Any form of director remuneration (like your salary and expenses) will be excluded from your investment, therefore you need at least 200k investment excluding any salary you paid yourself during three years.

[regularuser]

Thanks Zimba88

I have invested 200k as director loan but initially I was paying all the expenses from my pocket e.g. through personal credit card or bank account as this amount count as investment ?

Reply much appreciate.

[zimba]

Thanks Zimba88

I have invested 200k as director loan but initially I was paying all the expenses from my pocket e.g. through personal credit card or bank account as this amount count as investment ?

Reply much appreciate.

You legally can repay yourself for those expenses however they cannot be shown on your accounts under Director remunerations otherwise they will not be counted towards invetsment

[regularuser]

Thanks

My accountant advised me that amount can be count as your loan to the company bcoz you paid all this amount on behalf of company, can i claim all that amount as a director loan ?

[zimba]

Thanks

My accountant advised me that amount can be count as your loan to the company bcoz you paid all this amount on behalf of company, can i claim all that amount as a director loan ?

As I said above, your accountant is correct. However HO does not accept any Director Remuneration as investment per their rules !

[regularuser]

Sorry but not talking about remuneration, Initially when i start my business i paid all the expenses means all stock purchase, assets from my account or credit card. that all investment count as a director loan or investment in company ?

[zimba]

Sorry but not talking about remuneration, Initially when i start my business i paid all the expenses means all stock purchase, assets from my account or credit card. that all investment count as a director loan or investment in company ?

From an accounting point of view, what you paid from your pocket counts towards your company expenses.
However your company annual accounts must show that you have given a loan of at least 200K to your company or you purchased 200K worth of shares, as this is a required as the evidence of investment. HO does not care how much you have spent in your company, as per guide they need to see the loan/investments in your accounts

[suvalike]

Hello everyone,

I am regularly reading post from other users and getting a info about my extension.

I have seen my solicitor for extension application and pointed out some point which bit confusing me.

1) he asked companies all bank statement since we started bcoz he wants review for all the statements for 200k investment purpose.

2) he also told me that you have to make 200k investment plus your Director salary e.g. 200k investment + director salary paid in 3 years.

Can somebody put light on this topic as director i have drawn salary in my person account and paid my personal bills and expenses and remainder give it to the Company as a Director Loan.

Much appreciate your advise.

1. You need to send all the business bank statements which show you personally transferred at least 200K to your business. If you done it in multiple steps, you have to show multiple statements covering 200K.
2. The rules and the guide are very clear on this. Your 200k must be invested in the company to be spent as business expenses (employee salary, taxes, utilities, purchases, rent, fees, assets, etc) BUT you cannot pay any salary to yourself from your 200k as it will NOT be counted towards your investment. Any form of director remuneration (like your salary and expenses) will be excluded from your investment, therefore you need at least 200k investment excluding any salary you paid yourself during three years.

So e.g if he has done that investment in 5 transactions in five months then just five statements of those months but not all the three years statments...right ?)

[Frontier Mole]

There is a simple reason your accountant wants the three years worth of statements....
It is to ensure that the investment of £200k can be evidenced and it is not recycled funds coming in and going out and repeated to get to £200k

Accounts can be made up to show just about anything.... Hard cash in the bank statement is harder to jerrymander.

[zimba]

So e.g if he has done that investment in 5 transactions in five months then just five statements of those months but not all the three years statments...right ?)

Yes. Just the transactions not all the statements plus the most recent statement to show you still have a bank account.

There is a simple reason your accountant wants the three years worth of statements....
It is to ensure that the investment of £200k can be evidenced and it is not recycled funds coming in and going out and repeated to get to £200k

Accounts can be made up to show just about anything.... Hard cash in the bank statement is harder to jerrymander.

In his case the solicitor is asking to see them (accountants also ask to see your statements when doing your accounts). However as I said above, the 200K loan has to be mentioned in the accounts very clearly under your name as per HO requirements for the award of points

[regularuser]

Hello everyone,

I have some query regarding my Director's loan account as i was reading different thread about loan and HO rules.

1)I have to submit my personal bank account statements to prove money injected in the company as a loan.
But, If i paid direct to suppliers or bought a machinery initially from personal credit card than how will i prove that money injected in the bank account ?

2)If my company issued me shares against this investments and expenses than still do i need to prove to HO about Issued share capital ?

Appreciate all responses.

Thanks

[regularuser]

Hi everyone,

I was reading post from other users and getting idea for my extension.I Have question regarding Share capital.

I have invested money in my company as a share capital 50,000 and 150,000 as a director loan.

1) Will HO allow that as a 200,000 investment criteria ?

2) What other proofs do i need to submit with my application apart from Share certificate ?


Appreciate all responses.

[zimba]

Hi everyone,

I was reading post from other users and getting idea for my extension.I Have question regarding Share capital.

I have invested money in my company as a share capital 50,000 and 150,000 as a director loan.

1) Will HO allow that as a 200,000 investment criteria ?

2) What other proofs do i need to submit with my application apart from Share certificate ?


Appreciate all responses.

1. Yes. You can invest in cash (directors loan) or shares
2. Loan agreement per guide requirements as well as unaudited accounts

[regularuser]

Thanks for prompt reply zimba88,

Do i need to submit any other proofs apart from share certificate and unaudited accounts to prove the investments ?

[zimba]

Thanks for prompt reply zimba88,

Do i need to submit any other proofs apart from share certificate and unaudited accounts to prove the investments ?

Please read the guide. You need loan agreement plus the business bank statements showing the money transfers, share certificates and unaudited accounts.

[noajthan]

@regularuser, kindly refrain from creating multiple topics in same sub-forum with related questions all about the same extension.

Ref Board T&C on multiple posts (click)

I have merged your posts.

[regularuser]

Hi everyone,

I have seen my solicitor for preparation for my visa extension, now he told me you have to add director salary in to your 200k investment mean if i took total 25k salary during the 3 yrs than i have to prove 200k + 25k. Bit confused as I took salary to survive as new business won't make any profit so far. He pointed out that people reinvest in the business to make up 200k.

Please need advice as i have to fulfill another 25k short on 200k investment as per my solicitor.

Appreciate all responses.

[noajthan]

Hi everyone,

I have seen my solicitor for preparation for my visa extension, now he told me you have to add director salary in to your 200k investment mean if i took total 25k salary during the 3 yrs than i have to prove 200k + 25k. Bit confused as I took salary to survive as new business won't make any profit so far. He pointed out that people reinvest in the business to make up 200k.

Please need advice as i have to fulfill another 25k short on 200k investment as per my solicitor.

Appreciate all responses.

You need to get up to speed on relevant guidance.

Available Funds
Invested or spent by the applicant’s business excludes spending on all of the following:

• their own remuneration

Ref https://www.gov.uk/government/uploads/s ... _0_EXT.pdf
- page 16

[regularuser]

Thank you.

so how will you survive means you are the only one who earns money and also paid taxes on your earnings ?

Home office thinks entrepreneur spend money out of his pocket and still invest 200k, is that correct?

[noajthan]

Thank you.

so how will you survive means you are the only one who earns money and also paid taxes on your earnings ?

Home office thinks entrepreneur spend money out of his pocket and still invest 200k, is that correct?

Normally in business the aim is to generate a revenue stream.
That pays for business expenses, such as staff & raw materials & operating costs.
If you are lucky it generates a profit to reinvest or cascade into the owner & shareholders' pockets too.

I don't know what HO expects. Except that the visa is obviously to stimulate investment and growth in the UK economy and workforce.

As per the guidance, and my understanding of it, the 200K is to be fully invested and spent in the business within the initial 3 years.

[zimba]

Hi everyone,

I have seen my solicitor for preparation for my visa extension, now he told me you have to add director salary in to your 200k investment mean if i took total 25k salary during the 3 yrs than i have to prove 200k + 25k. Bit confused as I took salary to survive as new business won't make any profit so far. He pointed out that people reinvest in the business to make up 200k.

Please need advice as i have to fulfill another 25k short on 200k investment as per my solicitor.

Appreciate all responses.

Your solicitor is correct. According to immigration rules, any director's salary paid must not come from your 200k investment. You are expected to support yourself using your own savings and profits generated.

[Tire1Questions]

That's really interesting.
What happens in the case of a director who has invested the money into company as Share Capital. Now, employs his wife (obviously she is on dependent visa Tire 1 Ent. ) and she takes the salary from the company (as she is allowed to work in any company OR she is not restricted from working). I know, her hours cannot be counted to gain the points for employing two workers. But this way, at least you would not shortfall the £200,000?
Am I right in thinking?

[zimba]

That's really interesting.
What happens in the case of a director who has invested the money into company as Share Capital. Now, employs his wife (obviously she is on dependent visa Tire 1 Ent. ) and she takes the salary from the company (as she is allowed to work in any company OR she is not restricted from working). I know, her hours cannot be counted to gain the points for employing two workers. But this way, at least you would not shortfall the £200,000?
Am I right in thinking?

Yes she can be employed but if HO finds out you are gaming the system, your leave could be curtailed and you will be deported from the uk.

[Tire1Questions]

Thanks Zinba.
No, I am not gaming the immigration. Technically, she is allowed to work in any company in UK. And if she works in my company and I am paying her the salary (and not counting her working hours to claim the points for 3120 working hours). How and Why HO can refuse one's visa?