Family & Partner Visa Financial Requirement: Cash Savings
The financial requirement for partner, parent and child visa applications is set out in Appendix FM of the Immigration Rules as a gross annual income of at least £18,600. One way in which the financial requirement can be met is through reliance on cash savings, under Category D.
The level of cash savings required may vary if there are additional dependent children on the application, if cash savings are to be combined with another permitted source of income, and whether it is an application for indefinite leave to remain on the partner/parent/child route.
How is the level of cash savings calculated?
In order to rely on cash savings, in part or in full, the minimum amount of savings you must hold is £16,000.
The financial requirement for entry clearance/leave to remain applications under Appendix FM is set out in the Rules, and is listed on the online application forms, as £18,600 gross per annum, however cash savings are calculated to meet this amount using the following basic formula:
(Amount of cash savings – £16,000) ÷ (the period of the grant of leave: 2.5 years) = must equal at least £18,600
To rely solely on cash savings you will therefore need to show £62,500 in cash savings: (£18,600 x 2.5 + £16,000 = £62,500).
If you hold less than £62,500 you may still partially rely on those savings, as long as they exceed £16,000, and make up the shortfall in other permitted sources of income, for example:
If you hold £25,000: (£25,000-£16,000) ÷ 2.5 = £3,600. Requiring an additional £15,000 in another source of income, such as employment, to meet £18,600.
If you hold £40,000: (£40,000-£16,000) ÷2.5 = £9,600. Requiring an additional £9,000 in another source of income to meet £18,600.
The level of cash savings required will increase if there are additional dependent children, who are not British or otherwise settled in the UK . The minimum financial requirement increases by £3,800 for the first child and £2,400 for each further child. For example an applicant with two children will need to show £24,800, which using the formula above, will require £78,000 in cash savings.
Who can hold the cash savings?
Savings must be held by the applicant, their partner or by the couple jointly in a personal bank account or savings or investment account, provided that the funds can be accessed immediately (with or without penalty). You may use a combination of different personal bank accounts to meet the requirement, if savings are spread across multiple accounts. Please note the comments below on the particular restrictions on relying upon investment accounts.
You cannot rely on savings held by a third party or family member except in a number of limited circumstances, as outlined in a previous blog post. In order to rely on any funds from a third party the funds must be transferred as an irrevocable gift and be held by the applicant/partner/couple jointly for the required period of time. A signed declaration is then required to confirm that the funds are under the applicant/partner/couple’s control, (that is they are not simply borrowed for the purpose of the application) and to confirm the source of the funds.
The funds can be held in GBP or in another currency, provided that the level of funds did not drop below £62,500 in the relevant period using the closing exchange rate at the date of application, using the currency conversion rate published on Oanda.com.
The funds can be held in a UK bank account or held in an overseas account, provided that they are held by a financial institution regulated by the appropriate regulatory body in that country.
How long must cash savings be held?
Savings must be held by the applicant/partner/couple jointly for at least 6 months prior to the date of application. Any bank statements provided must be dated no earlier than 28 days before the date of application. Failure to provide evidence of funds held for this period of time will mean the requirements are not met and the application will be refused.
In addition, you may rely on savings that are the proceeds from the sale of property or the liquidation of investments as long as the assets were owned and/or held in the 6 month period prior to the date of application. Additional documents will be required such as proof of ownership, proof of sale, proof of payment for professional services and taxes, portfolio reports etc.
Can I rely on savings held in an ISA or investment account?
You can rely on an ISA or investment account provided that the savings can be immediately withdrawn. This includes any account where there may be a penalty to withdraw funds without notice. The Home Office Guidance confirms that this penalty should not be deducted from the level of savings held at the date of application.
A stocks and shares ISA account would meet the definition of a savings account in Appendix FM. Whereas a brokerage account in which funds are used by stockbrokers to purchase shares for the account holder would not meet the definition. With respect to the latter, the required level of funds held in stocks and shares or bonds would need to be liquidated. Proof of ownership for at least the period of 6 months prior to the date of application, proof of the cash value of the funds in that form at or before the beginning of the 6 month period, and evidence of the transfer of funds into cash (through a portfolio report and bank statements) will then be required.
Can you combine cash savings with other forms of income?
You can combine cash savings with employment, whether salaried or non salaried, in order to make up any deficit in current gross annual income (Categories A and B). It can also be combined with non-employment income, such as rental income, dividends, maintenance payments, (Category C) and pension income (Category E).
You also cannot combine cash savings with past employment under part 2 of Category B where they have been employed for less than 6 months and need to show that they meet the financial requirement over the 12 month period prior. Current cash savings in this case cannot be combined with past earnings. The rationale is that this does not provide an accurate picture of the financial resources available to the couple and allows income to be effectively counted twice.
Cash savings cannot be combined with self-employment income (Category F) or income from employment as a director of a specified company (Category G), with the rationale similar to that outlined above and explained further in this previous blog post.
With reference to the calculations set out above, there is some level of flexibility in meeting the financial requirement through multiple sources of income. However, care must be taken in preparing the application to ensure that this is outlined clearly and that all specified documents are provided.
What specified evidence do I need to provide to show cash savings?
You will need to provide personal bank statements showing that the cash funds have been held throughout the period of 6 months prior to the date of application and that the level of funds has not dropped below the required amount.
In addition you will need to provide a Declaration signed by the account holder confirming the source of the funds.
Appendix FM-SE sets out specific requirements as to the required evidence outlined above in paragraphs 11 and 11A.
Contact Our Immigration Barristers
For more information on the financial requirement under the Immigration Rules, or to discuss an application under Appendix FM of theImmigration Rules then please contact our specialist immigration barristers on 0203 617 9173 or via the enquiry form below.