On 17 February 2022, the UK Home Office announced the release of the UK’s “golden visa” residency-by-investment programme, the Tier 1 Investor visa route, is closed for all new applicants from all nationalities within instant effect. But there are a couple other ways to obtain a UK visa if you have funds to invest.
What is the Tier 1 UK Investor visa?
The UK’s residency-by-investment programme was first introduced in 2008 and allowed you to enter and stay in the UK if you invested around £2,000,000 in capital. Your investment will be restricted to government bonds or share capital of active and trading UK companies.
Why is the UK shutting down the investor visa?
The Tier 1 Investor visa route has been under constant review and, in many cases, gave rise to some security concerns. While the Home Office has done work on this visa route to improve it to prevent questionable funds entering the UK, it has decided to now close the route to prevent further abuse.
Home Secretary Priti Patel commented on the choice: “Closing this route is just the start of our renewed crackdown on fraud and illicit finance. We will be publishing a fraud action plan, while the forthcoming Economic Crime Bill will crackdown on certain people abusing the financial institutions and to better protect taxpayers.”
With this visa route now closed, we must look at the other routes open to individuals with the investment funds.
Alternate routes for investors in the UK
The UK’s points-based immigration system was designed to attract foreign workers based on their skills and contributions they could make to the economy. The Skilled Worker visa is far from the most popular way to do this. But the Skilled Worker visa requires you to have a confirmed job offer from a licensed sponsor as well as being able to meet the skill level and salary threshold.
If you do have investment funds, there are two ways to go to the UK without a job offer: the Innovator visa or the Start-up visa. Both these routes are designed to attract entrepreneurial talent from overseas and is aimed at individuals looking to set up an innovative business in the UK.
At first glance, these two routes may seem quite similar and individuals who are looking to start a business in the UK often wonder which one they should apply for.
The UK’s Innovator visa –
The Innovator visa targets individuals who are looking to establish an innovative business within the UK. Innovator visa applicants must have either their business or business idea endorsed by a Home Office approved endorsing body.
The business does not have to be a new one. However, if you’re starting a new business, you will be required to have £50,000 in investment funds and be able to prove how your funding was acquired.
You must be able to show that your business idea is:
- New – you cannot join a business that is already trading.
- Innovative – you must have an original business idea which is different from anything else on the market.
- Viable – it has potential for growth.
You are exempt from the investment funds requirement if your business was already established and has been endorsed for an earlier visa. Or if you changed your business and was already approved with your endorsing body.
Innovator visa requirements
You must be:
- At least 18 years old
- Able to meet the English language requirement
- Be able to prove that you have at least £1,270 in your personal savings to support yourself while you’re in the UK
- You can stay in the UK for three years on this visa and you can apply for it to be extended. There is no limit on the times you can extend this visa.
What you can and cannot do on an Innovator visa
With an Innovator visa you can:
- Set up a business or several businesses
- Work for your business – this includes being employed as a director, or self-employed as a member of a business partnership
- Bring your partner and children with you as your ‘dependants’, if they’re eligible
- Travel abroad and return to the UK
- Apply to settle permanently in the UK (also known as indefinite leave to remain) if you’ve lived in the UK for three years and meet the other eligibility requirements.
You cannot:
- Do any work outside your business, for example work where you’re employed by another business
- Work as a professional sportsperson, for example a sports coach
- Apply for most benefits (public funds), or the State Pension
The UK’s Start-up visa
If you do not have the investment capital to start a new business or are not an experienced business owner, then the Start-up visa is a viable pathway. It’s similar to the Innovator visa in that you can apply for it if you want to set up a new, innovative business in the UK – it must be something that’s different from anything else on the market. Your business must be endorsed by an authorised body that is either a UK higher education institution or a business organisation with a history of supporting UK entrepreneurs.
Start-up visa requirements:
You must be:
- At least 18 years old
- Able to meet the English language requirement
- Able to prove that you have at least £1,270 in your personal savings to support yourself while you’re in the UK
As with the Innovator visa, you must show that your business idea is:
New – you cannot join in an existing business that is already trading
Innovative – you must have an original business idea which is unique from anything else on the market
Viable – it has potential for growth
The Start-up visa allows you to stay within the UK for two years, but you cannot extend this visa. You may be able to switch to a Skilled Worker visa if you eventually meet the requirements or an Innovator visa if you start up a business while on a Start-up visa and:
- Your endorsing body has assessed and agreed to it
- Your business is trading, active, and sustainable
- You have day-to-day involvement in it
- What you can and cannot do on a Start-up visa
With a Start-up visa you can:
- Bring your partner and children with you as your ‘dependants’ if they’re eligible
- Work in another job, as well as working for your business
- Travel abroad and return to the UK
- Switch to this visa from some other visa categories
You cannot:
- Apply for most benefits (public funds), or the State Pension
- Work as a professional sportsperson, for example a sports coach
- Settle in the UK on this visa
Which route is right for you?
The main differences between the Innovator and Start-up visas are the required investment funds and level of experience. More experienced business people with sufficient investment capital available are ideal candidates for the Innovator visa. Less experienced entrepreneurs who have not set up a business in the UK before are better suited to the Start-up route.
New business owner – The Start-up route is aimed at people who have never established a business in the UK before, while this is not a condition of the Innovator route.
Funding – While both these visas require you to have £1,270 in your personal savings to support yourself while you’re in the UK, only the Innovator visa requires an amount of £50,000 as an investment when you’re starting a new business.
Work – On the Start-up visa, you are allowed to be employed at another job outside of your business. This is not allowed on the Innovator visa, meaning you can only work in your own business.
Settling in the UK – If your intention is to settle in the UK permanently, then you won’t be able to do that on the Start-up visa, which is only valid for two years and cannot be renewed or extended. You can, however, switch to an Innovator visa which is valid for three years and there is no limit to the amount of times it can be renewed. Interestingly, on the Innovator visa, you will be able to apply for indefinite leave to remain after three years, if the specific requirements are met, which is two years sooner than other routes, such as the Skilled Worker visa.