The terms governing the criteria for Tier 1 Investment Visas are changing. The rules were significantly reshaped with effect from 6th November 2014, with the most obvious alteration seeing the minimum investment commitment doubled from £1 million to £2 million. Other significant changes saw the qualifying investment options narrowed to exclude property or property-related schemes (previously up to 25% of the investment was permitted in this area); the shutting down of the facility to use borrowed funds to meet the qualifying threshold, and the removal of the obligation to ‘top up’ the level of investment in the event that market changes result in its value falling below the threshold.
But whilst those headline changes were undoubtedly substantial, they are unlikely to be the last. The Migration Advisory Committee to the Home Office has declared that it is reviewing various aspects of the Tier 1 (investor) route and it is expected to announce its recommendations during the course of the calendar year of 2015.
It is widely known that proposed changes relate specifically to the criteria that determine the scope of migrants’ investments. It is believed that the committee is considering widening the scope of such investments to encourage a more entrepreneurial contribution to the economic life of the UK. On this basis so-called angel investment schemes, venture capital initiatives, pooled investments and possibly even philanthropic, charitable donations may be permitted within the terms of the scheme. No date has yet been set for the announcement of any such changes.
Whilst the UK government has a declared interest in attracting funds to offset government borrowing, research has shown that a broader economic benefit to the UK economy as a whole accrues from the entrepreneurial potential that high net worth individuals offer. The changes currently under review are also driven by the need to make the tier 1 scheme more commercially attractive to potential applicants.