The UK Government has at last published the changes that are being made to the Tier 1 (investor) visa route, and we can confirm that the minimum financial threshold is being increased to £2 million. This will not apply to existing holders of the visa.
In a ministerial statement, James Brokenshire, the Immigration Minister, said that the Government will also consult on what sort of investment the route should encourage in order to deliver real economic benefits to the UK.
This route, which is designed for ‘high net worth individuals making a substantial financial investment to the UK’, has been around for more than 20 years and was the subject of a report earlier this year by the Migration Advisory Committee (“MAC”), who had been asked by the Government to consider whether ‘the investment thresholds were appropriate to deliver significant economic benefits for the UK’.
The MAC made a number of recommendations and today’s announcement confirms that the Government have taken some of them on board.
Details of the changes were today laid before Parliament and they are:
- The financial threshold has been raised from £1 million to £2 million. This recommendation is really just an adjustment for inflation
- The ‘topping-up ‘ rule, that penalised investors twice in the event of a sustained drop in the stock market, has been removed.
- The 75:25 split of the investment funds, allowing for up to £250,000 to be invested in any assets (including the investor’s home), rather than the restricted class of qualifying investments into which at least £750,000 has to be investment, has also been ended. This is effectively just the correction of an anachronism from 20 years ago, when £250,000 could buy a reasonable apartment in central London
- The existing provision under which the required investment sum can be sourced as a loan is being removed.
No changes have been made to the current class of ‘qualifying investments’ that have to be made in order to comply with the rule. The MAC made a number of recommendations how to widen this class to bring more targeted economic benefit to the UK, but the Government has not yet grasped the issues and will have a formal consultation on this specific aspect of the rule ‘in due course’.
The changes will come into force on 6 November 2014 and will only apply to applications made on or after that date. They will not apply to existing holders of this visa, who will continue to only need to invest £1 million but will remain subject to the current rules including the topping-up rule and the 75:25 split.
Anyone who wants to qualify for the lower £1 million threshold needs to move quickly and finalise and submit their applications before 6 November 2014. Our expert immigration team is on standby to assist as many of our clients who wish to file their applications now in order to secure the lower investment threshold.
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