Can You Start a Business on a Student Visa?

There are strict rules governing what international students can and cannot do during their period of leave in the UK, including rules on working. But is it possible for student visa holders to start a business in the UK?

 

Can international students start a business in the UK?

Student visa holders are not allowed to start a business, undertake business-related activity or be self-employed.

You will be considered to be engaging in business activity where you are working for a business in which you have a financial or other significant beneficial interest in a capacity other than as an employee, for example, setting up a business as a sole trader or under a partnership arrangement and that business is either trading or establishing a trading presence.

You are, however, allowed to develop your business idea alongside your studies and in the UK under your student visa and await the decision on your application.

If you do have plans to start a business after you have completed your studies, you will need to consider your visa options to remain in the UK. The primary route for individuals setting up a business in the UK is the Innovator Founder route.

If you have made an application for leave to remain under the Start-up route, you will be allowed to develop the idea while in the UK under your student visa and await the decision on your application.

Importantly, you will not be able to start trading while you are in the UK with a student visa. You must first await the decision on your Start Up visa application.

 

UK student visa work rules

The Tier 4 student visa has been replaced by the Student visa route.  The rules on working while under a Student or Tier 4 visa are the same. Student visa holders are restricted in the type and amount of work they can carry out.

The main purpose of the student route is for students to come to the UK to undertake a course of study. Where you are permitted to work, the intention is that this should be to supplement your income through employment whilst studying.

As such, there are limits on the number of hours you can work, depending for example on the type of course you are participating in.

You may be permitted to work either 10 hours per week, where you are studying on a full-time course below degree level sponsored by a UK recognised body or a body in receipt of public funding as a Higher Education Institution (HEI), or 20 hours per week where you are studying a course above degree level at a similar UK recognised body or HEI.

Permissible remote work performed for a non-UK employer while you are in the UK as an international student would be counted towards your weekly 10 or 20 hour maximum.

Time spent working can be in addition to any time spent on a permitted work placement.

Once your course has ended, you may work full-time, provided your conditions of stay permit work and you have leave to stay in the UK lawfully under your visa. This is because period at the end of the course of study is classed as vacation time.

If, having fully completed the course for which your CAS was assigned, you make an application for new leave under a different visa classification before your existing leave expires, you will be permitted to work full-time, within the limits described above, until your application is decided.

If, on the other hand, you stop studying before completing your course, you will no longer be entitled to work and will be in breach of your conditions of leave if employed.

In certain circumstances, you may also be permitted as a international student to undertake a work placement as part of your course, providing it is an integral and assessed part of the course of study.

However, in most cases, even where you are permitted to have a work placement as part of your course, the time you spend on it must not exceed 33% of the total length of your course undertaken in the UK.

 

Prohibited work for international students

In circumstances where you are permitted to work under your student visa, there are still certain jobs that you are not authorised to undertake. These include the following:

• Be employed as a doctor in training, save except on a recognised foundation programme
• Be employed as a professional sportsperson, including a sports coach
• Be employed as an entertainer
• Fill a full-time, permanent vacancy, save except on a recognised foundation programme or where you are filling a post as a Student Union Sabbatical Officer
• Be self-employed, or engage in business activity

 

Examples of prohibited business-related activities

The Home Office caseworker guidance on the student visa provides a non-exhaustive list of business-related activities that are prohibited under the route.

These include:

• “setting up a business as a sole trader or under a partnership arrangement and that business is either trading or establishing a trading presence
• being employed by a company in which they hold shares of 10% or more (including where the shares are held in a trust for them)
• working for a company where they also hold a statutory role, such as a director.”

 

In practice, this would mean that work such as running an online business, writing and producing content for profit, passive income generation and affiliate marketing income generation are likely to be considered business-related activity and as such prohibited for international students.

Jobs in the so-called ‘gig economy’, such as Uber taxi driving and Deliveroo delivering, are permissible only where you are engaged as an employee, and not on a self-employed basis. You will need to clarify this formally with the employer.

You can only buy and sell unwanted items on online marketplaces such as Ebay occasionally and where you don’t plan to make a profit. Anything more than this, where you are selling online to make profit, would be classed as a ‘trading’ and you would be considered self-employed, which is prohibited under the student visa rules.

 

Post-study business visa options

The main visa options to start your business in the UK after you complete your studies are the Graduate route and the Innovator Founder visa.

 

Graduate route

The UK’s graduate route allows student visa holders to remain in the UK to work for up to two years after they graduate, or three years if they have a PhD. Under the route, graduates can work in any kind of role without having to be sponsored. This means there are no restrictions on skill level, working hours or salary level.

It also means Graduate visa holders can be self-employed and start their own business. Alternatively, you could use your time on the Graduate route to research and build your business idea, while earning in any kind of job, in preparation for making your Innovator Founder endorsement and visa application.

The Graduate route is, however, temporary and not a route to settlement. To stay in the UK after your period of leave as a graduate, you would need to apply to switch into a different visa category before your leave expires.

 

Innovator Founder visa

The Innovator Founder visa allows foreign nationals to set up and run their own business in the UK.

Applications will see applicants and their business ideas vetted by an approved industry body against set criteria, looking at viability, scalability and innovation.

Endorsement must be secured in advance of the visa application being made to the Home Office. While there is no formal requirement to have initial capital investment, applicants may need to consider how they will achieve their projections without some form of investment. You will need to submit a business case to secure endorsement.

Under new rules introduced in July 2023, student visa holders, or those whose last grant of leave was as a student, are only allowed to switch into the Innovator Founder route if one of the following conditions apply on the date of making their application:

• they have completed their course of study for which the Confirmation of Acceptance for Studies was assigned, or
• the course is full-time and degree-level or above with an education provider with a track record of immigration compliance, and the job will not start before the course completion date, or
• the applicant is a PhD student studying with an education provider with a track record of immigration compliance, and the job will not start any earlier than 24 months after their course started.

 

If your application is successful, you can stay in the UK for up to three years, and you may then become eligible for settlement.

 

Need assistance?

If you have a viable business idea that you want to pursue in the UK, there are strict rules you will need to follow to avoid falling foul of Home Office regulations and quashing your dreams before they have got off the ground.

Given what’s at stake, international students looking to start a business in the UK should take advice on their immigration options well in advance of their student leave expiry to understand their options and how to proceed with any Home Office application.

DavidsonMorris’ team of business immigration legal advisers can support with all UK visa applications. For advice on your circumstances, contact us.

 

Student visa work rules FAQs

Can someone on a student visa work?

Students are allowed to work under their student visa, but strict restrictions apply to the type of work and the number of hours that can be worked. The primary purpose of the student visa is for study in the UK, rather than employment.

Can you work full time on a student visa?

No, student visa holders are limited to working a maximum of 20 hours per week during term-time. This cannot be averaged over a longer period.

Can you apply for a visa to start a business if you are a student?

International students can only apply to switch to the Innovator Founder visa if they have completed their course of study or, in the case of a PhD, if they have completed at least 24 months of the course.

Last updated: 19 July 2023