Immigration under Review

Following an extensive review, the Migration Advisory Committee has published its report on the Tier 1 (Investor) route investment limits and economic benefits. The review has made the following conclusions:

1) The investment programme continues to represent good value against other investment visa programmes throughout the world

2) Whilst applicants obtain a benefit from residence in the UK and ultimately British citizenship, it is less clear the extent to which British citizens benefit from the investment programme as the current programme promotes investment in Government bonds ‘Gilts’ and the fear of losing immigration status leads applicants to resist making direct investments in UK companies where the benefits are more tangible

3) There has been a minimal take up of applications under the higher investment thresholds of £5 and £10 million as the incentives are not sufficient.

In light of these findings the Migration Advisory Committee has made the following series of recommendations to address the issues raised in their report:

  1. Increase the minimum investment threshold as this has not changed since 1994
  2. Broaden the permissible investments with a view to encouraging people to invest in asset classes beyond UK gilts which offers little direct benefit to the UK
  3. Removal of requirement to top up investments to take away a degree of the risk of investing in classes other than Gilts
  4. A possible limit on the scale of investment in Gilts
  5. Introduction of a new premium route to be auctioned by the Government which will allow for accelerated settlement and include more relaxed residence requirements.

The merits of these new proposals are going to be debated in the coming months and we expect that some but not all will be agreed upon. We understand that the agreed proposals are to be introduced prior to October however if you have clients considering possible applications under the Tier 1 (Investor) Route you may wish to discuss with us whether or not it is appropriate to proceed under the existing programme or delay until the new provisions have been introduced.

For further information, please contact a member of our Wealth Planning team.

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