Croydon PEO - Limited Company - Extn Approved - Experience

[theroyale]

Just to share my experience here of my Tier-1 extension application at Croydon PEO today:

I am contracting through my own Limited Company, paying myself income through salary and dividends. I produced 8 months' worth of evidence (payslips, dividend vouchers, bank statements, accountant letter) as this was enough for points. Especially if you are paying yourself a salary just below the taxable threshold (approx 7200 pounds for this tax year I believe), the below is important:

The first thing my case-worker did was ask me for my salary slips and dividend vouchers. These covered a period from April 2011 - December 2011. Now, my accountant and I have structured the payouts so that a minimal amount of tax and NI is paid every year, deducted only in the last month of the financial year(i.e. March). So none of my presented slips had any deductions. He immediately asked me about that, to which I said most of my income was through dividends and I only paid tax in my last month. Luckily I had made sure to take the previous financial year's P60 with me - this would show deductions for that year. He asked me for it and I could give it to him.

I presented the accountant letter but he didn't seem very interested in it. I wasn't even asked for my business bank statements. All he asked for was:

- Payslips
- Dividend vouchers
- Personal bank statements

He asked me to wait in a waiting area, and I made sure to tell him that he just needs to ask in case he wanted to see any other documents (my intention was to tell him clearly that I had more evidence if required). He then took about an hour to decide my case, mostly shuffling papers and squinting at the computer screen.

Given the number of different documents that can be used to evidence a Limited Company salary + dividends structure (as opposed to permanent employee structure) it is difficult to say what exactly they considered most important. But given the caseworker's initial, immediate question (as soon as I sat down in front of him) it seems clear that they want to see current/previous evidence of paying tax/NI to HMRC. Those who plan their extensions well in advance, I would suggest that you make sure you structure your salary payouts so that a little tax is deducted every month and is shown on your payslip. If not, make sure to take your P60 and volunteer it saying it shows deductions (they may not ask you for it themselves).

Some general advice: be communicative and assertive. Don't sit back and wait for him to ask you for each document. But don't just throw a big bundle at the caseworker either. Give it one by one, telling them clearly what each one is and why exactly you are presenting it to them.

Good luck to everyone, and lastly thanks to everyone in the forum who took the time to reply to my and others' queries.. Invaluable stuff!

I'll check the forum over the next few days - so if you have any questions that I'm able to answer, shoot. Will try to help.

Some other miscellaneous points:

- My bank statements were a combination of originals and stamped-and-signed faxed statements (but no covering letter from the branch). I was prepared to explain this but no questions.

- All payslips and dividend vouchers were stamped-and-signed by both me and my accountant. I pointed this out to him as well.

- Highlighted with a marker pen all receipts of salary and dividends into my personal account.

[vishal.jha]

Hi

Thanks for the detailed post.
It really helps a lot.
Just want to check couple of things:
How did the case worked check your total number of days outside the UK, did he check each and every stamp on the passport or calculated only on the basis of information you have provided on the form.

Secondly, did you mention yourself as self employed or an employee of your limited company. I suppose there is a confusion on that.

Lastly, how did you calculate your days outside the UK..say if you left on 1 Jan from UK and came back on 4 Jan, your days outside UK are going to be 2..or 3..or 4? I assume it will be 2 but just want to confirm.

Many Thanks in advance for your response..

[theroyale]

did you mention yourself as self employed or an employee of your limited company. I suppose there is a confusion on that.

I ticked 'Employed' on the form. A strict interpretation of rule 6A would suggest you are 'Self-Employed'. If you are going for an in-person appointment it doesn't matter too much as you are present to clarify any doubts.

Lastly, how did you calculate your days outside the UK..say if you left on 1 Jan from UK and came back on 4 Jan, your days outside UK are going to be 2..or 3..or 4? I assume it will be 2 but just want to confirm.

My initial visa - got it in december 2008 - does not have these conditions (of being in/outside the country etc), so wouldn't be able to help you on this one.

[QuickSam]

Good Luck buddy

So did you get the response or are you awaiting anything?

[theroyale]

So did you get the response or are you awaiting anything?

Hi QuickSam, it was approved yesterday, I got the approval letter. The Biometric Residence Permit is awaited, apparently takes a week, it is sent to your home address by courier.

[antipode]

Out of curiosity

- What nationality are you?
- Had you given biometrics for your initial application in your home country, or here in UK?
- Were you claiming the same qualifications from your initial application?

[theroyale]

Hi Antipode,

Out of curiosity

- What nationality are you? Indian
- Had you given biometrics for your initial application in your home country, or here in UK? Just here. Back in end-2008 during my initial application there were no biometrics
- Were you claiming the same qualifications from your initial application? Yes. The caseworker checked my qualification against NARIC on his computer but didn't ask to see my certificate again (even though I'd taken it with me).

[vishal.jha]

thanks for the reply theRoyale...

Would you be able to answer the below question as well..

How did the case worked check your total number of days outside the UK, did he check each and every stamp on the passport or calculated only on the basis of information you have provided on the form.

[QuickSam]

Vishal,

'theroyale' only applied for an extension and not an ILR. The leaves are checked only in the case of ILR.

[theroyale]

How did the case worked check your total number of days outside the UK, did he check each and every stamp on the passport or calculated only on the basis of information you have provided on the form.

vishal.jha, my Tier-1 visa does not have a 'number of days outside UK' clause. So this was irrelevant in my case.

[vishal.jha]

thanks for the reply QuickSam and theRoyale.
Apologies, I thought your application was for ILR.

QuickSam, you you ahve any idea of the answer to my question?
I will post it in the ILR forum as well.

[QuickSam]

I'll tell you a simple fact. When you are in doubt, trust your instinct.

If you are trying to mix and match your leaves to be able to get the ILR, if there is a doubt get a second extension and then apply for ILR later when you are sure that your leaves are lesser than 180 days and you haven't taken 90 days continuous leave.

As far as your question goes, I believe if you leave UK on 11th and return on 13th. For me this is 2 days, some people might be inclined to count it as 3 days as stated in your original question.

[mukesh.jain]

hey Royale

quick question, what documents did you take to prove that your accpuntant is a genuine one?
Did you get any certification etc documents from the accountant or just the ACCA membership number is enough?

[theroyale]

quick question, what documents did you take to prove that your accpuntant is a genuine one?
Did you get any certification etc documents from the accountant or just the ACCA membership number is enough?

The letterheaded sheet on which my letter was printed had my accountants' certification number. That was sufficient. But if you want you can attach their business card as well to the letter.

[gauravgupta]

Hi theroyale,
Please help me, as I got one doubt.
I'm also looking for my Tier 1 extension & is employed as director under my limited company from July last year. I'm getting a one problem, don't know if there is any issue with it, my accountant used to provide me the salary slip, dividend for each week but money is transfered from my business account to personal account sometimes in 2 week , and somtimes in 1 week as one transaction, and also when I reimbused my expenses, then in some transactions they are further combined in 1 transaction i.e. if I have claimed £400 as expense, then on my dividend slip the amount become (original dividend - expense) and some times if it exceed the dividend for that week it is subtracted from salary also so for few week I had salary+dividend+expense coming in one transaction.

when I contacted my accountant he provide me a letter and a Income schedule, explaining my net salary, gross salary, net dividend, gross dividend, expense reimbursed and total amount credited in my account. Someone told me that expenses should not be shown in the transactions, as now just the salary & dividends are not matching with my bank statement, but if we mention the expense they matches.

so can someone please let me know if there will be any issue regarding this? if yes, then what should we done now. secondly, on one of the transaction they have credited my dividend+mine salary+ my wife dividend as one transaction in to my account, so is there will be any issue realting to this, or should I just make one transaction from my personal account to my wife personal account stating the return dividend, is that will be fine. please help me, or let me know if you have any format where I need to explain all these details.

quick question, what documents did you take to prove that your accpuntant is a genuine one?
Did you get any certification etc documents from the accountant or just the ACCA membership number is enough?

The letterheaded sheet on which my letter was printed had my accountants' certification number. That was sufficient. But if you want you can attach their business card as well to the letter.

[rajesh9pl]

Thanks theroyale. Your post is really helpful. I know I am too late to acknowledge but its never too late.

[sshah20]

To
theroyale,

congrats on your tier 1 extension. I am also in the same position as yours. I set up a limited company in Nov, 2011 and drawing Minimum salary(below tax threshold) and dividend. my salary every month for financial year, 2010-2011 was £600 which attracts no Tax but very little NI. my extension is due in Dec, 2012. Corporation tax on my company will be due in August, 2013. it means that up-to my extension I will not be liable for any taxes.

My question is paying minimum salary to yourself (below tax threshold) will make any problem in extension?

another thing is personal allowance for the year 2011-2012 is £8105. it means I can increase my salary from £600 to £675
Can I do that?


shah

[rajesh9pl]

To
theroyale,

congrats on your tier 1 extension. I am also in the same position as yours. I set up a limited company in Nov, 2011 and drawing Minimum salary(below tax threshold) and dividend. my salary every month for financial year, 2010-2011 was £600 which attracts no Tax but very little NI. my extension is due in Dec, 2012. Corporation tax on my company will be due in August, 2013. it means that up-to my extension I will not be liable for any taxes.

My question is paying minimum salary to yourself (below tax threshold) will make any problem in extension?

another thing is personal allowance for the year 2011-2012 is £8105. it means I can increase my salary from £600 to £675
Can I do that?


shah

My two cents - few of my friends who operate through their own ltd company have recommended to take a salary which attracts a small amount of tax.

[tier1_aspirant123]

theRoyale,

about the salary slips and dividend vouchers, were these stamped and signed by you and your accountant?

regards,

[longshift]

Congratulations Mate.

Does Croydon PEO checked your docs and then asked you to make you payment or Payment was made as soon as you entered and all the docs were submitted afterwards?