Advantages and perils of investor and entrepreneur routes to Britain

(Wednesday, 27 June 2018)

An interview with Helena Sheizon, the founder and CEO of Kadmos Immigration Consultants

Helena was called to the bar at the Middle Temple in 2005, and by 2006 set up her firm, Kadmos Consultants, a boutique immigration and business consultancy. Kadmos Consultants has since helped hundreds of people achieve their goals in making Britain their home through business and family immigration.

 

What was it that attracted you to immigration? Do you enjoy working in this field?

About 35 years ago, having just finished school in the gloomy late-Soviet Moscow, my best friend and I were fantasising about the ideal place to set up home and start a new life. At that time, we saw the hostile environment contained behind the Iron Curtain; the world outside was friendly and welcoming to us, with a distinct whiff of freedom.

I believe that people should have the freedom to choose where to make their home, whether for a short while or for good. For the last twelve years, I’ve been advising clients on the best immigration options for them. Whether driven by the lifestyle they seek, educational opportunities for their children, or by business prospects they aim to pursue, immigration is always a complex issue with life-changing outcomes. I help my clients make their dreams come true. I also make sure these dreams are well-rooted in reality, which is why they can relax knowing their future is in safe hands.

In your opinion, what are the main factors restricting immigration to the UK?

A main factor is the lack of immigration options available for low and medium skill-level workers. It’s a shame, as this could eliminate workforce shortages in a number of fields if operated like the route currently used for highly skilled employees (titled Tier 2 in immigration jargon).

At the other end of the spectrum, another factor is the restriction on permitted absences from the UK for high-net-worth individuals (HNWIs) seeking permanent residency in the UK. Until recently, there were no restrictions on absences for family members of the main visa holder, which allowed careful planning of an immigration strategy to achieve maximum benefit for the family.

Nowadays, people are put off by the requirement to spend at least 180 days a year in the UK, but I believe the effect of these restrictive changes will soon level out. Britain still remains an attractive destination and careful strategy planning will help you get to where you want to be.

Which immigration options are the most appealing? 

After the spousal visa route, which is restricted to partners of British citizens or residents with indefinite leave to remain, investor and entrepreneur routes remain among the most flexible options you can think of. They allow HNWIs to enjoy the British lifestyle while offering a relative freedom of movement outside the UK, without jeopardising the right to eventually be accepted as a permanent resident. Both routes require investment, but they are very different in essence and should not be confused.

What are the benefits and challenges of the entrepreneur route?

Tier 1 Entrepreneur route is for those who wish to set up and run their own business in Britain. For the majority of business people, the required level of investment is £200,000. This capital can be split between two applicants with a joint business idea if they apply for entry clearance at the same time as an entrepreneurial team. The funds can also be provided by a third party, as long as one can demonstrate a genuine intention to invest the money in the business.

One of the main hurdles of this route is the risk associated with starting up a new business. It is a well-known fact that the majority of new enterprises do not reach their third birthday and 80% do not survive for five years. Funding investments in a new business is always associated with risks, and this is where Kadmos Consultants are uniquely placed to help both with immigration compliance, as well as with viability and sustainability of the business.

What kind of help do you offer overseas entrepreneurs?

Our work with entrepreneurs normally starts with the preparation of a business plan. Unlike other consultants, we never provide any off-the-shelf, standardised solutions. On the contrary, our primary task is to understand the proposed business’s objectives and ambitions, before picking it up at its existing stage and encouraging its development into a fully-fledged, actionable business plan.

The plan needs to be thought through, of course, with an eye to immigration requirements, adding a further layer of complexity. It’s very important not to keep immigration and business concerns in separate drawers. One of our tasks as business consultants is to integrate immigration requirements into the overall business plan, keeping it simple, down to earth and practical. This way, we ensure that the client’s long-term goals are met.

From the start, every detail of the entrepreneur route should be carefully developed, including a thorough and reliable Plan B to protect and prepare the client for any outcome.

As a case study example, when assisting a young mum in setting up her business, we had to consider the various locations of her children’s schools (as she still had the school-run!) in relation to her business’s opening times, investment schedule and advertising strategy. We also had to consider her other freelance work options for her to support herself before the business’s income was reliable.

With a clear roadmap to success, taking action is much easier. And there’s no better reward than to see things work!

How different is the investor route?

An investor is required to invest at least £2m into UK government bonds, share capital or loan capital within active and trading UK registered companies. Some benefits of this route include the waiver of the English language test, as well as the right to work or study in the United Kingdom – enjoyed by both the main applicant and their dependents.

It’s not enough to have £2m available for investment, however. For initial applicants, the first hurdle is to open a UK bank account with confirmation that the bank will accept a transfer of £2m. This involves enhanced due diligence checks carried out by the bank, including a full investigation of the source of the funds. We normally recommend opening an account with a wealth management firm to handle the investment portfolio, as this provides certainty and reduces any risk of delays in the investment process. It’s essential that the portfolio manager is familiar with the Tier 1 investor programme, since the timing and type of investment are crucial to the success of this immigration route.

The investment needs to be made within three months of an entry date into the UK. Although this seems like enough time to find your bearings and decide on your investment portfolio, complications can always arise with exchange rates and money transfers to the UK, as well as with due diligence checks if not carried out in advance.

Not every investment qualifies, and often investors are not aware that proceeds of the sale of any investments in the portfolio must be reinvested into eligible investments within a certain time frame. Many extension applications fail because of easily avoidable errors like this, which unfortunately cannot be corrected in hindsight.

Can immigration lawyers make a difference when mistakes have already been made?

When there is no way of correcting a mistake (such as a crucial step not being completed on time, for example) then the only way to deal with the situation is by asking the Home Office to exercise discretion. You would need to explain why this should happen, and emphasise why your particular case is deserving and different from others facing the same difficulties. Lawyers can fight your corner and save the day, but there’s still no way to guarantee the outcome in advance. For this reason, it’s always better to have a lawyer on board from the start, to help you avoid these mistakes – not correct them!

What made you decide to add ‘citizenship by investment’ programmes to your services?

Many of our clients either wish to gain, or don’t want to lose, their EU citizenship. One of the most attractive solutions on the market is Cyprus. It’s incredibly quick – in just under six months you can become an EU national. This process requires investment in property – generally considered one of the safest options in the long term – and holds no residency requirements, although it gives the investor a right of residence and a European passport. Until the Brexit date, this still works as a route to settling in the UK, which is particularly important for those who care for parents or have responsibility for an extended family. EU law is considerably more generous in respecting the right to family unity, which for many people is a decisive factor that cannot be ignored.

The British Government has promised that those who are in the UK before May 2019 will not be required to leave, so there is still time to take advantage of these EU rights.

 

Helena can be contacted for consultations in relation to business and family immigration by email to helena@kadmos.org.uk

No1 Olympic Way, Wembley Park, London, Middlesex, HA9 0NP, UK
Call: +44 (0) 20 8930 9503
Email: helena@kadmos.org.uk
Website: www.kadmosimmigration.com

Posted in Articles, Guest Content.

Leave a Reply

Your email address will not be published. Required fields are marked *