Personal Immigration

Meeting the spouse visa financial requirement as a director of a limited company

In July 2012, following on from the report from the Migration Advisory Committee, a minimum income threshold was introduced in respect of sponsorship under the family migration route as set out within Appendix FM of the Immigration Rules. A minimum threshold of £18,600 was set, with additional amounts for any ‘relevant’ children.

Appendix FM-SE of the Immigration Rules sets out various evidential requirements which must be met in order to satisfy the financial requirement. Different evidential requirements will apply depending on the particular circumstances of the applicant and/or their partner.

Limited companies are owned by its shareholders. A director employed by the company may well be a shareholder and, generally, this income can be counted as employment or non-employment income under Appendix FM-SE where the evidential requirements are relatively straightforward.

However, where the business is a ‘specified’ limited company, as defined by paragraph 9(a) of Appendix FM-SE, the application will be assessed in a different way under the Immigration Rules. The rationale for this is set out within the Home Office’s Immigration Directorate Instruction, Appendix FM Section 1.7 which states at paragraph 9.7.1.:

‘[…] in a company in sole or limited family ownership there is scope for doubt as to the effective control of the company, as the person is a director and shareholder or the other shareholders are family members of that person. In that case, instead of the employment evidence in Category A or Category B or the dividend evidence in Category C, we need evidence about the operation of the company.

What, then, is a ‘specified’ limited company? Paragraph 9(a) of Appendix FM-SE states that a ‘specified’ limited company is one in which:

1. the person is a director of the company (or another company within the same group); and

2. shares are held (directly or indirectly) by the person, their partner or the following family members of the person or their partner: parent, grandparent, child, stepchild, grandchild, brother, sister, uncle, aunt, nephew, niece or first cousin; and

3. any remaining shares are held (directly or indirectly) by fewer than five other persons.

If the company is one that meets the above definition then all of the documentation set out within paragraph 9(b) of Appendix FM-SE must be provided.

It is important to note that the director of a specified limited company can only rely on the income that they have received during the company’s most recent financial year. As companies can, and often do, set their own financial year, this may well be different to the fiscal year which runs from 6 April to 5 April.

A director who receives a salary and dividend income will need to provide, amongst other things:

  1. Payslips showing salary payments during the company’s most recent financial year;
  2. Dividend vouchers in respect of dividend payments declared in their favour during the company’s most recent financial year;
  3. Personal bank statements showing receipt of the salary and/or dividend income.

In addition to evidencing the income received from the business, it is necessary to provide evidence regarding the operation of the company so as to demonstrate that the applicant and/or their partner has ‘effective control’ over the business.

Because the company’s financial year can be for any 12 month period, the end of the relevant financial year may well be many months before the date of the actual application for entry clearance or leave to remain as a partner. In this regard, the Immigration Rules require evidence of ongoing employment as a director of the company or of the ongoing receipt of dividend income from the company must also be provided. This evidence can include, but is not limited to, recent payslips and/or dividend vouchers since the financial year ended.

It is therefore important to ensure that if a person is employed as a director of a specified limited company that they are mindful of the strict evidential requirements that must be met so as to ensure that the correct evidence can be provided to demonstrate that the requirements of the Immigration Rules are met.

Contact Our Partner Visa Barristers

If you would like further advice on an application for entry clearance or leave to remain as a partner under Appendix FM of the Immigration Rules, or in relation to any other immigration matter, then please contact our immigration barristers in London on 0203 617 9173 or email info@richmondchambers.com.

SEE HOW OUR IMMIGRATION BARRISTERS CAN HELP YOU

To arrange an initial consultation meeting, call our immigration barristers on 0203 617 9173 or fill out the form below.

open
close

Expert advice & representation from immigration barristers that you can rely on.

Google+ - Five Stars

Read our 200 five out of five star Google+ reviews from our previous clients.

More
AWARDS