How easy is it to set up a business in the UK?
Over the course of the last year the UK government has changed the types of visas available for people who want to set up businesses in the UK. One of the casualties of this shake-up was the Entrepreneur Visa, which allowed individuals who had a business idea and money to set it up the business to come and live and work in the UK.
Cheaper alternatives to having £2 million in the bank
Of course It is still possible to get a visa based on investment, but you will need to have a minimum of £2 million in the bank to qualify for the Investor Visa. This rules out most people. There are, however, two new and less costly routes which are designed to attract innovative business ideas to the UK. They are:
- The Innovator Visa, where you need at least £50k to invest and a new business idea. You can’t join an existing business via this type of visa and you will be assessed on both the novelty and the viability of your business idea by an ‘endorsing body.’ These are organisations approved by the UK government to assess the value of business ideas.
- The Start-Up Visa, which is quite similar to the Innovator Visa, in that you need an innovative and viable business idea, but it doesn’t set a minimum investment level. You will, however, need to have your idea endorsed by a UK university or an endorsing body and you can’t join an existing business.
There are also 2,000 Exceptional Talent Visas on offer each year for established or emerging leaders in their field. Again applications will be assessed on their merits, but this time by learned bodies such as Royal Society or the Royal Academy of Engineering.
Is there another alternative?
But what if you have a business which is deemed to be neither particularly innovative or with high growth potential – but you still want to set up in the UK?
There remains in the UK something called the Sole Representative of an Overseas Company Visa. This particular visa isn’t well publicised by the UK government, and to be quite honest, we’re rather surprised it survived the recent shake-up of the business visas system which eradicated the old Entrepreneur Visa. In fact it seems to pre-date entirely the current points-based system of assessing visa applications.
Establishing a branch of your business in the UK
If you are a company already established and operating in another country you can send an individual to establish a branch of your business in the UK. There are certain requirements for this type of visa. Your company can not have another branch or subsidiary in UK already. You must intend to run a business similar to the one already operating in your own country. Your representative must be a director or someone with sufficient authority to proceed with decision making in the UK. They must not be a majority shareholder and our advice is that they should not hold more than 30 per cent of the shares in the company. The business doesn’t have to be profitable or pass any kind of viability test, just registered in its home country and trading. It does, however, have to continue trading and its representative has to open a branch or a subsidiary in the UK. The applicant also has to prove they have sufficient funds to support themselves, but again no set amount is stated, and they can bring family members too. The Representative can only work for the business and no other employment in the UK. The initial visa lasts for three years and as long as the company continues to trade abroad, and they want the representative to remain in the UK on company business, it can be extended for a further two years. Once they have lived in the UK for 5 years the visa holder can apply for Indefinite Leave to Remain.
Relatively pain free
We think this is a relatively pain free way to set up a business in the UK compared to the other routes which are subject to strict evaluation. It may not last forever, however, given all of the changes to UK immigration policy caused by Brexit. So if you’re thinking of trying this route we would advise not leaving it too long to apply. As with any visa application we recommend getting professional advice before you start filling in the forms.