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Tier 1 Entrepreneur Extension (Errors to Avoid!)

We are frequently instructed by Tier 1 Entrepreneur Visa holders who have been refused their Tier 1 Entrepreneur extension.

It’s extremely frustrating, and can result in having to start a new extension application and potentially having to leave the UK if your visa has expired – adding to costs and disrupting both business and family life.

There are many reasons why the Home Office denies entrepreneur extensions. In this article, we look at some of the more common grounds for refusal, but given what is at stake – your permission to remain in the UK lawfully and to become eligible for settlement – taking advice on your extension application can help to ensure errors are avoided and that you are putting forward your strongest case.

What is the Home Office looking for?

The Tier 1 Entrepreneur extension process is rarely straightforward. In most cases, it is even more demanding on applicants than the initial visa application. This is because the Home Office is looking for evidence that you have satisfied the requirements under your initial visa during your most recent period of leave. Extensive documentation is therefore essential to support your Tier 1 Entrepreneur extension application and to verify your continued eligibility under the visa route.

For your Entrepreneur Visa to be eligible for an extension, you will need to score at least 95 points under the points-based criteria, comprising:

  • Attributes: 75 points
  • English language: 10 points
  • Maintenance funds: 10 points

Attributes: 75 points

  • A minimum investment amount of £200,000 – or £50,000 if you were awarded points for funds of £50,000 in your initial visa application – has been invested by you or on your behalf directly into one or more businesses in the UK.
  • During your current period of leave, you have registered with HMRC as self-employed or registered with Companies House as a director of a new or an existing company or member of a new or an existing limited liability partnership. This must be on a date no earlier than 3 months prior to the date of your application.
  • The business you have invested in must have created at least two new full-time jobs for individuals settled in the UK. The jobs must have existed for at least 12 months during the period for which the most recent leave was granted.

English language: 10 points

  • You are the national of a majority English speaking country; or
  • You have passed an English language test level B1 of the Common European Framework of Reference required; or
  • You have a degree that was taught in English and is equivalent to a UK bachelor’s degree or higher.

Maintenance funds: 10 points

  • You have at least £945 of personal savings, held for 90 consecutive days prior to the date of your application.
  • You have a minimum of £630 for each of your dependants if you have been in the UK for more than 12 months.

Common Application Errors in Tier 1 Entrepreneur Extensions

Source of funds

This is an area attracting increasing interest and scrutiny from the Home Office. If your investment funds have been provided by a third party, you must include documents to evidence the invested funds are from the same third party.

Jobs for resident UK workers 

You have to evidence that your business has created and maintained at least two full-time roles for UK resident workers during this period of leave. Evidence will be important here e.g. contracts of employment showing working hours, payslips, emails to/from relevant employees from the course of business.

The Home Office guidelines are strict on this requirement but it’s a common area of confusion among applicants given the realities of running a business usually brings complex and changing recruitment needs.

In practice we see issues arise, for example, in relation to temporary or part-time workers hired for variable hours per week. For the purposes of the visa, multiple part-time positions cannot be combined to be considered one full-time role – whether the roles are concurrent or relating to different time periods.

In addition, if you have joined an existing business, the existing employees will not count under the job creation requirement.

Payroll 

The RTI format for payroll information must follow the Home Office’s specific format to the letter. Failure to submit as prescribed will result in a refusal of your application.

Further, should you take any salary out of the business, this should not be taken from the investment funds so as to avoid reducing the level of investment to below the minimum threshold.

Right to Work

A compliance duty on all UK employers is the requirement to verify that every employee has the right to work and carry out the role. This means your business should be conducting right to work checks on all its employees. This includes checking and verifying identification documents prior to the start of employment, and at regular intervals if the employee has temporary right to work in the UK.

Accountant qualifications 

Your professional advisers need to hold the required qualifications. We have seen applications refused on the basis that the accountant who had signed off the accounts was not in fact qualified to do so.

Up to date documents 

Double check that all documentation relates to the required time period, for example, being the most recent. This includes items such as the appointment report.

Do you have a question about your Tier 1 Entrepreneur Extension?

It is best practice to prepare for your extension application from the point of the initial investment – ensuring you are keeping relevant records and that you are satisfying the requirements under the investment funds and job creation as part of the daily course of our business. The extension application then becomes a matter of pulling the information together in the required format and allows time to respond to any queries the Home Office may have when processing your application.

If you are concerned that your visa is due to expire shortly or if you have been refused an extension application, contact our Tier 1 specialists. We are experienced in advising on extension applications within challenging circumstances and can assess your case and advise on options and strategies for making your extension application.

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