In London we continue to see an increasing number of high net worth (HNW) individuals and families exploring the immigration options available to them to visit the UK on a long term basis or move here permanently. Global mobility is on the increase and greater political and economic uncertainty in parts of the world causes people to look to come to the UK.

The UK is attractive for several reasons including being seen as a safe haven for inward investment, being home to a world leading education system, political and economic stability, and benefiting from a robust and highly regarded legal system. Furthermore, it offers a flexible visa for HNW individuals coming into the UK. Once these individuals are UK resident, they are able to benefit from a highly favourable tax regime under the current tax regime. It is worth noting however that, should a Labour Government be elected in the May 2015 General Elections, they have stated that they will withdraw this tax regime. 

So why are HNW individuals looking to the UK? Individuals are increasingly looking to diversify their investment portfolios and move to the UK for personal needs or to further their European corporate interests. In addition there are anticipated changes to the Portuguese Investor visa regime following corruption allegations which make the UK regime more attractive.

In this article we explore the Tier 1 Investor route - the most common type of UK visa for non-EU HNW citizens. We also explore changes which were introduced to this visa route on 6 April 2015. All non-European citizens, regardless of nationality, need a visa to live/work in the UK for six months or more.  This area is complex and detailed advice should be sought before moving to the UK.

Tier 1 Investor Visa

Applicants need at least £2 million under their control in a regulated financial institution (anywhere in the world) which can be transferred to the UK. To comply with the Investor conditions, and extend the visa or apply for future settlement, the funds must normally be invested in the UK within three months of the visa date. Unless the applicant wishes to apply for future settlement there is no requirement under this route to reside in the UK. The visa allows the holder and/or their family to travel to or live in the UK freely with no time commitment on UK stay. The visa may be a useful emergency tool, enabling holders and their dependants to reside in the UK at short notice. The current rules allow an unlimited number of extensions if the investment is maintained.

Type of investment

Funds must be invested in UK Government bonds (gilts), or share capital or loan capital in active and trading UK registered companies, other than those principally engaged in property investment, management or development. Holders need to invest the entire £2 million in this way - investments in UK assets (e.g. a home) or cash on deposit at a UK bank will not qualify. 

Why choose the UK Investor route?

The visa is flexible allowing varied UK investment opportunities.  Investors can choose the profile of their portfolio depending on their risk appetite. Visa holders are not required to spend time in the UK unless they want to achieve settlement. Dependent family members can reside in the UK to attend school or to work.

We summarise the visa conditions below.

Click here to view the table.

April 2015 Changes

UK visas and immigration ("UKVI") issued some changes to the Investor scheme applying to all applications submitted on or after 6 April 2015. The main changes are:

  • New applicants must set up a UK bank account for the purpose of investing at least the mandatory £2 million in the UK. This outsources due diligence checks on applicants to the UK banks. As it can take time for banks to conduct their mandatory checks before opening an account, the lead-in time for new visa applications is likely to increase.
  • The minimum investor visa applicant age increased from 16 to 18 years. This addresses UKVI concerns that under 18s cannot have true control of investment funds. 
  • The investment top-up provisions (amended in November 2014) were revised again. Applicants no longer need to invest additional capital if they sell part of their investments at a loss, but they will be required to maintain all their capital within the investment portfolios. Trading of capital is permitted provided the investor does not withdraw any capital. The new rules require that the investor re-invests any proceeds of the sale of investments into qualifying investments (whether or not they are sold at a gain or at a loss) by the end of the next reporting period, or within six months of the sale date, whichever is sooner.  Under these rules it is important to invest more than £2 million so that the surplus can cover portfolio management fees, transaction costs and tax on the investments, as these costs cannot be paid from the minimum qualifying investment. 
  • Consulates retain the power to assess the source of an investor's funds meaning they can refuse an application if they have reasonable grounds to believe that: applicants do not control the investment funds; the funds were obtained unlawfully (or by means which would be unlawful in the UK); or the character, conduct or associations of a party providing funds mean that approving the application is not conducive to the public good. Whilst the rules do not require submission of evidence of source of funds where £2 million has been held in a bank account for 90 days, we are seeing some British posts look more closely at source of funds. Checks into the "genuineness" of investors and their funds will continue.

UK residency and taxation

The UK residency and domicile status of an individual determines his exposure to UK direct taxes. An individual will have access to a favourable UK tax regime, known as the “remittance basis” of taxation, even if he becomes resident in the UK, provided that he is (and remains) domiciled outside the UK.  It is essential that HNW individuals wishing to move to the UK take appropriate tax advice and implement suitable pre-arrival planning in the tax year before they become UK tax resident to ensure their exposure to UK tax once tax resident is minimised as much as possible. This recommendation has become even more important in light of the Labour Government's pre-election pledge with regards to the tax treatment of "non-doms".


Immigration and tax law in the UK can change with little or no notice, particularly around the time of an uncertain general election which may see a change in ruling political party. It is therefore always advisable to seek specialist advice as part of your pre-application planning in connection with any visa application you or your clients wish to make.