what happens if invested 50k£ & buisness collapse

[aziz1053]

Hi,
I just wanted to know if you start your business & invest 50k£ then your company gets a lost or even go in debt liquidate & unable to stand until. 3 years. Does any law of UKBa highlight this point.

[tuliprose]

Hi,
I just wanted to know if you start your business & invest 50k£ then your company gets a lost or even go in debt liquidate & unable to stand until. 3 years. Does any law of UKBa highlight this point.

It is your responsibility how you run your business. Like, if you make a profit its your and similarly if you make a loss, its yours too.

UKBA does not share any profit or loss. But if you can prove that you had invested required amount of funds into your business and created two jobs then certainly you would get your extended for two more years.

[esic_sonia]

That is correct. UKBA just want proof of transfer of funds and its investment being made. 2 full-time Jobs for UK or ILR citizens.


Profit and Loss is your headache. UKBA do not bother about it.

[hham1224]

That is correct. UKBA just want proof of transfer of funds and its investment being made. 2 full-time Jobs for UK or ILR citizens.


Profit and Loss is your headache. UKBA do not bother about it.

As an Accountant as I explain in my earlier posts, if you transfer £50,000 in your business and your business gets busted, liquidated, insolvent you will lose your £50,000 depending on the how much liabilities you have when your business was closed (assuming it was more than £50,000).

From corporation/income tax point of view it is very easy to put something/cash/asset in your business at no cost (tax cost) but very hard to take it back without paying any tax liability. The only way where you get it back (90% chances) will be your loan to your business which you can take it back at no cost. But this is not applicable in all situations so effective tax planning is very necessary.

I have read here some people comments here that new changes don't affect genuine applicants. I think it will affect every body, means one has to retain £50,000 and must be accessible all the time. This is against the business rule. I haven't seen a successful director/businessman who keep £50,000 in his business account and leave it there till the end. This is a very stupid rule and I hope someone should challenge this in the high court.

I hope this helps

[surveyer]

That is correct. UKBA just want proof of transfer of funds and its investment being made. 2 full-time Jobs for UK or ILR citizens.


Profit and Loss is your headache. UKBA do not bother about it.

As an Accountant as I explain in my earlier posts, if you transfer £50,000 in your business and your business gets busted, liquidated, insolvent you will lose your £50,000 depending on the how much liabilities you have when your business was closed (assuming it was more than £50,000).

From corporation/income tax point of view it is very easy to put something/cash/asset in your business at no cost (tax cost) but very hard to take it back without paying any tax liability. The only way where you get it back (90% chances) will be your loan to your business which you can take it back at no cost. But this is not applicable in all situations so effective tax planning is very necessary.

I have read here some people comments here that new changes don't affect genuine applicants. I think it will affect every body, means one has to retain £50,000 and must be accessible all the time. This is against the business rule. I haven't seen a successful director/businessman who keep £50,000 in his business account and leave it there till the end. This is a very stupid rule and I hope someone should challenge this in the high court.

I hope this helps

No you are wrong I guess, you do not have to leave the amount in your account if you can prove that funds have been invested or made use for business related purpose.

[Jabs]

"UKBA just want proof of transfer of funds" - I see no mention of this in the Policy Guidance unless you can point me to this.

I would suggest to use a portion of the initial investment, let's say £10K and try to build your business on this, then if your business is generating reasonable revenue, re-invest this into the business maybe by recruiting your first employee after 12-18 months. This way you can mitigate risks just in case a 3rd party wants to wind-up your business.

After 3 years if you can prove your operating costs hit or exceed £50K then one should be fine, providing the rules don't change.

I don't know what systems UKBA have in place now or may do in the future so they are notified if a business is being struck-off by Companies House or for that matter with HMRC.

[aziz1053]

"UKBA just want proof of transfer of funds" - I see no mention of this in the Policy Guidance unless you can point me to this.

I would suggest to use a portion of the initial investment, let's say £10K and try to build your business on this, then if your business is generating reasonable revenue, re-invest this into the business maybe by recruiting your first employee after 12-18 months. This way you can mitigate risks just in case a 3rd party wants to wind-up your business.

After 3 years if you can prove your operating costs hit or exceed £50K then one should be fine, providing the rules don't change.

I don't know what systems UKBA have in place now or may do in the future so they are notified if a business is being struck-off by Companies House or for that matter with HMRC.

Yes you are very right. But UKBA doesn't say that invest small amount generate profit on that & reinvest its totally a different scenario can be a possibilty. Personally what I think this law is like a sea there can be millions of options I wonder how Ukba can cover all that but they are intelligent they know well..

[Jabs]

Aziz, this is not that complicated.

The operating costs in your P&L for 3 years needs to show that your outgoings (expenditure) purely for the business was £50K+.

How you kept your business afloat is not of UKBA's concern.

Have you got your Ent Visa yet?