Applying to extend a Tier 1 (Investor) visa - the balance of funds requirement

On 6 November 2014, the immigration rules changed significantly for the Tier 1 (Investor) category. Investors who were initially granted a Tier 1 (Investor) visa under the rules in place after 6 November 2014 must invest all of their funds in the UK by way of qualifying investments, (i.e. by way of government bonds, share capital or loan capital in active and trading UK registered companies). However, investors who were initially granted a Tier 1 (Investor) visa under the rules in place before 6 November 2014 are required to have invested not less than £750,000 of their capital in the UK by way of qualifying investment and to have invested the remaining balance of £1 million in the UK by the purchase of assets or by maintaining the money on deposit in a UK regulated financial institution.

This article explores the balance of funds requirement for Tier 1 (Investor) visa holders who were granted leave as a Tier 1 (Investor) before 6 November 2014 and have invested between £750,000 and £1 million in qualifying investments.

General Principles

If you were granted an initial Tier 1 (Investor) visa under the rules in place before 6 November 2014, major assets in the UK, such as unmortgaged property, may be taken into account for the balance of funds. According to Home Office policy guidance, the balance of funds can, subject to a limit of £250,000, be demonstrated through any of the following:

1. The value of the unmortgaged portion of your own home;
2. Assets in the UK held for investment purpose (but not personal possessions);
3. The value of all other investments in the UK (including for example any investments in open-ended investment companies); and
4. Cash on deposit in the UK.

Purchase of property

If you are relying on an investment in property, only the unmortgaged portion of your own home can be considered, up to a value of £250,000.

The property must be owned by you and/or your husband, wife, civil partner, or unmarried partner or same-sex partner.

You must provide documents confirming the purchase, for example, a deed of sale and a valuation report. The documents must show: 1) the assets purchased; 2) the value of the assets; 3) the date of purchase; and 4) the owner.

The property valuation report must be issued by a surveyor who is a member of the Royal Institution of Chartered Surveyor (RICS) and must have produced within the six months prior to the date of application.

The Immigration Rules specifically state that only an investment in a property that is your ‘own home’ may be taken into account. However, neither the Immigration Rules, Home Office policy guidance or Home Office modernised guidance provide any further clarification as to when a property will be considered to be an applicant’s ‘own home’. Caseworkers are therefore left without guidance as to how to approach situations such as where an applicant lives between two properties or shares their property with people other than their immediate family members. These sorts of real life situations – multiple ownership and multiple occupation – are simply not addressed, which has the potential to lead to inconsistent decision-making.

The Immigration Rules do prohibit investment in property management or property development. This is consistent with the requirement that the property must be the applicant’s ‘own home’. Literarily, if a Tier 1 (Investor) visa holder wishes to rely on a property purchase in order to satisfy the balance of funds requirement, the property must be a property that they live in rather than a property purchased for investment purposes.

In practice therefore, beyond the specified documents listed in the immigration rules, applicants may wish to provide additional evidence to demonstrate that the property that they have purchased is used for residential purpose only.

Cash on deposit

If you are applying for an extension of stay as a Tier 1 (Investor) under the rules in place before 6 November 2014 and need to satisfy the balance of funds requirement, you can also rely on money held on deposit in a United Kingdom regulated financial institution.

You will need to provide evidence from the financial institution to confirm the details of the deposit, for example, a statement of accounts, or a letter from the financial institution that holds the cash on deposit. The document must show:

1. Your name and or that of your husband, wife, civil partner, unmarried partner or same-sex partner;
2. The date that the money was deposited; and
3. The amount of money;
4. The official headed stationery of the institution holding the funds. You must ensure that the institution will confirm the content of the document to the Home Office at their request.

Conclusion

The ‘balance of funds’ provision of the Immigration Rule can be complex, especially, for applicants who entered the Tier 1 (Investor) visa category before 6 November 2014 and wish to rely on an investment into property. Neither the rules or guidance provide a clear definition as to what is meant by ‘own home’ or stipulate what evidence should be provided to demonstrate that a property is an applicant’s ‘own home’.

At Richmond Chambers, our barristers have assisted several Tier 1 (Investor) visa holders to successfully extend their stay by relying on a purchase of property in order to satisfy the balance of funds requirement. We understand the complexities of the rules and the evidence that the Home Office expects to see. Where unusually complex or uncertain situations arise, we are able to liaise with the Home Office Tier 1 policy team on behalf of our clients in order to obtain official position statements which can then, when appropriate, be relied on in support of an application.

Contact our immigration barristers

For expert advice and assistance in relation to a Tier 1 (Investor) visa application, contact our investment immigration barristers on 0203 617 9173 or via our enquiry form.