t1 extention: previous earnings thru limited company

[hussainkothari]

Hi All,

I have been a veteran member on this forum before 3 years. That is the time I had applied for a migration from WP to T1.
I could have muttered the rules in the middle of my sleep then, but not now! Its time for me to renew by visa again with the difference that I am contracting since the past 7 months.
My situation is described below. Could someone let me know what kind of documents to submit in the "previous earnings" section

I have been in the UK since the past 7 months and my visa renewal is due in June 2011. I have been contracting since the past 7 months thru my limited company. I am the sole owner.
I have hired an accountant and I take a salary and dividend and expenses every month and also pay VAT (at reduced rates), PAYE/NI and I am due to pay my corporation tax in August 2011 (after the visa renewal process)

Questions -
1. Am I self employed / salaried employment ?
2. Can my earnings would include
- Salary
- Dividend
3. What documents do I have to furnish?
- personal bank Stms (src1)
- paylslips (src2)
- dividend vouchers
- CERTIFICATE OF INCORPORATION
- letter from accountant?
- Invoices?
- business stmts/accounts?
- Employers Liability Insurance from an authorised insurer?
- Revenue & Customs (HMRC) as an employer to pay PAYE & National Insurance?
- Certificate of VAT registration and latest iv) VAT return confirming VAT registration number (my co's turnover is in excess of 64K)
4. Can I claim profits from the business?

Regards,
H

[hussainkothari]

Anyone please?

[allariel]

I have a similar situation.
I have been trying out to identify my status for almost 6 months now...
I run a limited company. I am the director of the company, and take a salary from the company.
Until now nobody could clarify to me how the UKBA will approach my application.
All I can tell for sure is that according to HMRC regulations, you are NOT self-employed. You are employed by the company, and receive a salary. You are self-employed if you operate as a sole trader and not through a limited company.
At the same time, as far as I understand, there is confusion among some UKBA people who answer the phone calls about who to consider self-employed. This is very frustrating...
Thus strictly speaking, not being self-employed but in salaried employment, you do not need to provide the company accounts, accountants' letters, etc. etc. The easiest way to confirm your earnings is to provide original pay slips and bank statments.
You may also consider attaching a letter from the employer... confirming your position in the company, the earnings, and all the necessary dates. I was advised to provide one... However, the letter should not be signed by you, it should be someone else in the company (i.e. a manager, or a HR person) who signs the letter. I hope you do have this "someone else."

I hope this helps...

If you do have more questions, let's discuss, as I am also very very confused. This is despite the fact that I have read and re-read the guidelines, and consulted several immigration solicitors.

[hussainkothari]

I do not have "some one" else. I am the 100% share holder.
I am sure this is a very common situation to be in. Many other members would have been in this situation. Just that no one seems to be responding to my looong question.

From my previous read on the other post, I can gather that I am a salaried employee and the payslips, dividend vouchers, bank stmts and accountant letter are a MUST. But I am not sure if I should provide the other documents. I don't want to provide excessive (extra) documentation. It may lead to confusion and more checks.

Anyone else who has cleared this situation?

-H

[allariel]

If you know everything, why do you ask?

[hussainkothari]

I ask coz I am not sure. Your comments did help. When is your ext due?

[allariel]

My situation is probably a bit harder.
I am switching from PSW (which runs out in January next year).
As the rules are changing, I should apply before 5 April.
To be honest, I am pushing myself to the limits in terms of work, and family relationships to be able to do so.

I am not sure about the letter from the accountants. I called UKBA and talked to a solicitor who is helping me with the application. From what I understand, if you are in salaried employment you are not required to submit the letter from the accountant.

I was also advised by the solicitor to keep the application simple, and not to confuse a case worker with loads of unnecessary information. So I am not submitting a certificate of incorporation and or any other statuary documents.

If you do not have "some one" to sign a letter (this is also my case), I was advise to hire somebody on a part-time basis (i.e. a company secretary, HR manager, of financial manager) who can verify your earnings and your position in the company in a letter. This person should be officially employed by your company to do the job. This is what I was advised to do.

Anyway, it is encouraging to know that I am not the only one working hard to live in this country. Although, at times I wonder does it worth it...

What is your company's business? It's just a question, you do not have to answer.

[hussainkothari]

Hi allariel,

Read http://www.immigrationboards.com/viewtopic.php?t=72938

[allariel]

Hi ~
Hope you had a good weekend.
Thank you for the link.

I understand that you need a company certificate, and information about share holders, as well as an accountant letter if you draw dividends from the company. This is because you need to prove that you are in a position to receive dividends. You need to show that you are a share holder of the company, the amount of shares you have, and if the company made profit for you to be able to receive dividends.

I do not take dividends from the company. All my income is just salary.
To prove my previous earnings the solicitor has advised me to submit:
1. original payslips (so there are no stamps or signs on them)
2. bank statements
3. letter from the employer, which is to be signed by the company's secretary (to confirm my position in the company and the earnings).

I asked about an accountant's letter, but was told that it is not necessary, as I am not self-employed. I will ask again, though.

[sreblog]

Questions -
1. Am I self employed / salaried employment ?
Self Employed,if your a contractor take salary less than 10k and rest as dividents to be tax efficient. Say if your taking 30K + dividents still you can claim your self employed as your director. If your taking salary + expenses only from your ltd company then your an employee (though your a director).

2. Can my earnings would include
- Salary
- Dividend
answer is yes salary + Divident.
Only salary if your showing as employee. (Make sure your salary is enough to qualify you).

3. What documents do I have to furnish?

- personal bank Stms (src1) (yes if your employee or Self Employed)
- paylslips (src2) (yes if your employee or self employed)
- dividend vouchers (yes if your self employee only)
plus your company statement ( if your self employee)


- CERTIFICATE OF INCORPORATION (not required)
- letter from accountant? yes for self employed
- Invoices? yes for self emplyed
- business stmts/accounts? yes for self employed
- Employers Liability Insurance from an authorised insurer? (not required)
- Revenue & Customs (HMRC) as an employer to pay PAYE & National Insurance? (not required)
- Certificate of VAT registration and latest iv) VAT return confirming VAT registration number (my co's turnover is in excess of 64K) (not required)
4. Can I claim profits from the business?
Dividents is profits!! or if your projecting as employee then you can take profits as bonus.

[thambu]

Hi Sreblog,

Can you please clarify my doubt as well?

Am in a similar situation in regards to declare myself as self-employed, as my Tier 1 visa extension is around the corner. I have a question on previous earning,

As am operating through my own limited company and I would need to show exactly 30K to be eligible for earning points.

Would it be possible to show a minimum salary eg salary £7200(as per new 2011 rule no tax), £600 as Net & Gross salary + remaining as dividends with tax ,

i.e 7200 + 22800 = 30,000,

Is it ok to go with this structure?

Please throw some light on this.

Am bit confused and wondering as opting for low salary, as we are not in position to pay any NI or PAYE to goverment on salary, in that case Do they have any system to compare with previous financial year earnings, because i have drawn 32K as salary last year and recently started my own company and working as a contractor.

if this is not the case then I need to change my salary structure.

any response would be greatly appreciated.

Thanks,
T

,

[sssabc]

Hi Experts,

I am too unable to get a clear picture:

I am the 100% share holder of the limited company but not the solo director.... Now in order to show the previous earning I am taking off minimum salary 7200 + Dividents (18000)... Am I able to show this as my previous earning?? I am not self employee... I am a employee under my own limited company.....

Please advise as I am got confused that only self employee can claim for dividents.. where as in my case I am a employee and 100% share holder of my limited company..

Thanks
SSSABC

[itsme]

Even though you are a 100% / 50% share holder of your own limited company caseworkers are dealing it as self-employed category. Whereas under HMRC guidelines you are an employee of your company.
btw I am also self employed IT contractor and only fee earner in my company.

I was under similar situation ( me-directory, wife-secretary)
During my online visit for ILR to PEO-Croydon I took below documents to show case worker. ( way back in June 2009)

-> All Original Invoices,bank statements
-> Payslips, P60
-> Letter from accountant stating my pay/dividends for past few years.
-> All CT600 copies ( company tax returns)
-> Tax paid to HMRC. VAT statements
-> Dividend pay slips.

As per guidelines you don't need to show many of these documents, but to be on safeside I carried all and neatly tagged each set of docs, spanning across last 4 years ( under HSMP JR rules)

At one instance case worker couldn't understand this and was demanding to show me how much tax I paid to HMRC etc. I explained whatever I can, eventually he consulted his seniors. It was positive at end of the day.

At that time I somehow felt Croydon isn't the best PEO, and learnt that Birmingham is the best as they collect money only after your application is sucessful.

[thambu]

Thanks a lot itsme!.

Is it ok to go with low salary(without NI/PAYE tax) + dividends? I believe as you said , i will fall under self employee category.

another question, would it be possible to apply early for visa extension instead of waiting for full 12 months, like if I would have earned that eligible earnings within 6 months.


my extension is by Mar 2012, can I extend by Dec itself?

Please advise me on this.

Thanks,
Thambu

[sssabc]

Hi,

Yes you can apply but you will get visa for 2 years from the date your application is evaluated... at the end you need to reapply again to qualify for ILR applicaiton (In order to apply ILR you need to complete 5 years on one visa category that is TIER1 General Visa ).

hope this clear.

Regards,
SSSABC