Tier 1 of the points-based system has been stripped of a number of sub-categories in recent years and continues to impose stricter restrictions on the remaining sub-categories, especially Tier 1 (Entrepreneur).
On November 24 2016 the evidential requirements for job creation – specifically, the requirement to provide the HMRC Real Time Information full payment submission (RTI) – were clarified by changes in the Immigration Rules. As well as drafting errors which previously caused confusion among practitioners and entrepreneurs applying under the Tier 1 category, the wording that was in place frequently prompted the understanding that providing the RTI is an optional rather than a compulsory requirement (for further details please see "Job creation and requirements for Tier 1 entrepreneur applications").
The most recent changes in the Immigration Rules introduced predominantly technical amendments to the Tier 1 (Entrepreneur) guidance and clarified provisions that previously caused issues for applicants. As is apparent from the extract below from the Immigration Rules as amended on November 24 2016, the paragraphs dealing with the documentation required as evidence of job creation have been redrafted and now contain clear requirements for the RTI:
"(h) if the applicant is required to score points for job creation in Table 5 or Table 6, he must provide the following:
(i) evidence to show the applicant is reporting Pay As You Earn (PAYE ) income tax appropriately to HM Revenue & Customs (HMRC), and has done so for the full period of employment for which points are being claimed, as follows:
(1) for reporting up to and including 5 October 2013 either:
(a) printouts of Employee Payment Records and, unless the start date of the employment is shown in the Employee Payment Record, an original HMRC form P45 or form P46 (also called a Full Payment Submission) for the settled worker showing the starting date of the employment, or
(b) printouts of Real Time-Full Payment Submissions which confirm the report of PAYE income tax to HMRC (if he began reporting via Real Time before 6 October 2013); and
(2) for reporting from 6 October 2013 onwards, printouts of Real Time-Full Payment Submissions which confirm the report of PAYE income tax to HMRC.
The evidence in (1) or (2) above must show the total payments made to the settled workers as well as the tax deducted and date which they started work with the applicant's business."
The Immigration Rules and Tier 1 (Entrepreneur) guidance confirm that the RTI must be submitted. The requirement is relevant to both leave to remain and indefinite leave to remain applications, and as such it is important to ensure that applicants or their accountants are fully aware of the requirement and have access to the information during the application preparation process. Applicants who were granted initial leave as Tier 1 entrepreneurs before October 6 2013 can rely on Section (1)(a) if they employed anyone before the changes in Her Majesty's Revenue and Customs' (HMRC) system.
In order to access and produce RTIs for an application and check what has been sent to HMRC, applicants can access the HMRC web portal using their gateway log-in details and click "Real Time Information". The web portal enables applicants to browse all of their RTI submissions for the current tax year. At the tax year's end, applicants will still be able to view their submissions by first clicking on the appropriate tax year and then "Previous Submissions".
For further information on this topic please contact Kamilla Kelemen at Magrath LLP by telephone (+44 20 7495 3003) or email (email@example.com). The Magrath LLP website can be accessed at www.magrath.co.uk.
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