UK Tier 1 Entrepreneur Category Visa under the Points Based System of UK Immigration Process


The United Kingdom immigration process is defined through a set of laws that have been passed over the last few years. These laws serve as the basis for a document known as the UK Immigration Rules that defines procedures and regulations for all visa types currently functional in the UK. A ‘visa’ is a document granted to any individual as a form of proof so that they can legally enter the country. In the UK, the visa is divided into 5 categories out of which 4 are currently functional, and exist to cater to any scenario an individual might wish to come to the UK under. These 4 categories are titled Tier 1, Tier 2, Tier 4 and Tier 5 and each is further divided into several subcategories. To elaborate, a person who wishes to come to the country for business purposes will apply on a different visa category than a person who wishes to enter for study purposes.

The Home Office, the department of the UK government that is in charge of handling immigration related cases including cases of asylum, detention and deportation, is headed by the Secretary of State who is obliged to abide by the immigration laws of the country. Any person who wishes to apply for a visa will submit his/her application to the Home Office which will further examine the case and decide whether the person should be granted a visa or not. In the scenario a visa application is rejected, a letter detailing the reason and informing the applicant of his/her right to appeal the decision is explained. It is not an unusual scenario that an appeal to a UK court resulted in the Home Office’s decision being changed in favor of the applicant.

The chances of a visa also vary depending on the applicant’s country of origin. This means that a country with a history of abuse of the UK’s immigration laws will result in a lower chance for the applicant of that country in having his/her visa application granted. Also, European Union (EU) citizens should note that as a result of the free movement agreement titled the ‘Schengen Agreement’, they can travel, stay, work and settle in the UK without any visa requirement. Citizens of the UK can also do the same in any EU country. Thus, the following article shall look at the visa application process for applicants who are non-EU citizens.

The following blog will look at the UK entrepreneurs visa category of the Tier 1 visa that exists for individuals who wish to enter country to start or run a business and invest in the UK. Although this is a general definition of this category, the Home Office will assess the nature of the business and check if it is of an entrepreneurial nature before granting the applicant a visa on this category. Other categories of the Tier 1 include the general category, UK investor visa category, UK graduate entrepreneur visa category and exceptional talent category.

Tier 1 Entrepreneur Visa

The Tier 1 Entrepreneur visa exists for individuals who wish to come to the UK for investment purposes of an entrepreneurial nature and to start or run a business in the country. This category is only applicable to non-European citizens.

What is the Points Based System and how is it related to the UK Tier 1 Entrepreneur visa?

The Points Based System is a measuring system set up by the UK government for visa applications, that helps determine whether an applicant has the minimum points required to be eligible for the visa category or not. Points are gained each time the applicant fulfills a visa requirement, and when enough requirements have been met that the applicant has secured enough points required for a visa category, he/she can be eligible for the visa. The number of points required varies from visa category to category and is dependent on the visa type also. For example, 75 points are required to be eligible for the Tier 1 UK investor visa while 95 points are required to be eligible for the Tier 1 UK graduate entrepreneur visa.

A total of 95 points are required to be eligible for the Tier 1 Entrepreneur visa. Several requirements exist with varying number of points that can be fulfilled to secure points. Such as:

  • The applicant can secure 25 points by proving to the Home Office that he/she possesses sufficient funds for investment purposes in the UK. Proof of sufficient funds can be submitted by:
  • The applicant showing that he/she possess funds greater than GBP 200,000.
  • The applicant showing that he/she has more than GBP 50,000 from venture capital firms that are registered and fall under the regulatory authority of the Financial Services Authority. It should be noted that the applicant is allowed to have this amount from multiple venture capital firms.
  • The applicant showing that he/she has more than GBP 50,000 from seed funding competitions that promote entrepreneurial activity. It should be noted that the competition is required to be on the list of endorsed competitions by the UK Trade and Investment website. It should be noted that the applicant is allowed to have this amount from multiple competitions. Or, if not this, then the GBP 50,000 can come from a government department (one or more) of the UK that had set the specific amount aside for the purpose of establishing businesses in the UK or expanding them. It can also be a devolved government department from Scotland, Northern Island or Wales.

If the applicant has funds greater than GBP 50,000 and less than GBP 200,000 available for investment purposes in the UK, and cannot fulfill the above mentioned condition of producing this sum from government or private institutions, then he/she must fulfill one of the following requirements:

  • The applicant is switching to this category from the Tier 1 Graduate Entrepreneur category and applying for an extension to stay in the UK.
  • The applicant is switching to this category from the Tier 1 visa and is applying for an extension to stay in the UK. Furthermore, the applicant must be self-employed, and be registered with HM Revenue and Customs or serving as the director of a business already in operation or one that has just started at least 3 months before he/she submits the application for extension. It should also be noted that the applicant should be involved in business, excluding the work he/she is required to overlook in the business where they serve as director.

Also, as per the codes of practice that exists for sponsors in the Tier 2 visa, the applicant’s job must exist in the National Qualifications Framework’s list of occupations and must be level 4 and above.

  • Another 25 points can be secured by submitting financial records which serve as evidence fact that the applicant’s funds that he/she has for investment purposes are held in a financial institute that is regulated by the UK government.
  • The applicant should have the authority to freely spend this amount in the UK. These funds will be termed as ‘disposable funds’ and the applicant will be awarded 25 points for fulfilling this requirement.
  • 10 points will be awarded when the applicant proves his/her English language skills. This can be done by taking an English language test that is approved and authorized by the UK.
  • 10 points can further be secured when the applicant submits significant evidence regarding his/her financial stability to support him/herself whilst in the UK.

So, by fulfilling all of the above mentioned requirements, a total of 95 points can be secured.

What if a person wish to apply for an extension to stay in the United Kingdom on the Tier 1 Entrepreneur visa?

Individuals currently staying in the UK on the Tier 1 UK Entrepreneurs visa are legally allowed to apply for an extension to stay in the UK. A total of 95 points will be required to be eligible for extension. This can be secured by fulfilling the following requirements:

  • The applicant, at the time of the initial application for this category, fulfilled either of the two requirements where he/she submitted financial records of investments funds that were to be spent in the UK. One was of possessing funds not less than GBP 200,000 and the other was of possessing funds not less than GBP 50,000. Whichever one of these requirements the applicant fulfilled, he/she must submit proof that the amount was invested in its entirety in cash in one or multiple businesses in the UK. This will award the applicant a total of 25 points.
  • 20 points are awarded to the applicant if he/she is a registered owner/director of a functioning business or is self-employed. It should be noted that the applicant must be registered as self-employed with the HM Revenue and Customs. Furthermore, the applicant must also be registered if he/she owns and runs a business.
  • Another 15 points are awarded if the applicant at the time of submitting his/her application for extension, is involved in a business activity. This can be proved if the applicant, within the last 3 months of the application, was registered as a director of a functioning or a new business or was registered as self-employed with HM Revenue and Customs.
  • Furthermore, the UK only recognizes the business activities of applicants who have their occupations listed on the National Qualification Framework’s list of occupations. As per the requirement of the Codes of Practice for sponsors of the Tier 2 visa, the qualification must be level 4 or more.
  • 20 points are awarded to applicants who are responsible for the creation of jobs in the UK that have existed for at least a year within the time granted to the applicant to stay in the UK.
  • Furthermore, minimum number of (full-time) jobs are two that must have been created for citizens of the UK. Or if not this, then the applicant must have taken over a business or invested in a business that resulted in the increase in the employment rate of that business to an extent that at least two (full-time) jobs were created.
  • 10 points will be awarded when the applicant proves his/her English language skills. This can be done by taking an English language test that is approved and authorized by the UK.
  • 10 points can further be secured when the applicant submits significant evidence regarding his/her financial stability to support him/her whilst in the UK.

The fulfillment of all of these requirements will result in the required points to be eligible i.e. 95 points.

For applicants applying for extension under this category, registration for self-employment or for a business that was taken over or started must have been made within 6 months after the applicant entered the country under this category and proof of the date the applicant arrived in the UK exists. But, if there is no proof regarding the date the applicant entered the UK, the date he/she was granted the Tier 1 Entrepreneur visa will be considered. Or if the applicant switched to this category from another category, again the date he/she was granted this visa will be considered.