The Tier 1 Investor visa category is for individuals who can make a substantial financial investment in the UK. To qualify for a UK Investor visa, one will need to have access to at least £2 million and be willing to invest those funds in actively trading UK companies. The Home Office reported that 96 main applicants and 172 family members received residence permits in the UK in Q3 of 2020 on the back of capital investments through the Tier 1 Investor Visa. This amounts to about GBP £192 million in a 3-month period. The number represents a 317% improvement on the preceding quarter and a 96% improvement on the same quarter last year. These figures are incredibly encouraging post Brexit and in light of the challenges caused by the ongoing pandemic.
It has been encouraging to see that despite border restrictions and lockdowns, there has still been a steady flow of applications for Tier 1 visas. We have seen an increase in interest in Tier 1 visas from the US, both from individuals looking to relocate to the UK or those with investments here who want ease of travel to the UK. The last reported quarter Home Office statistics saw applications from the US as the third most popular jurisdiction. We have been assisting US nationals to use both the Investor category and the new Skilled worker route introduced from the 1 January 2021.Potential reasons for this increase could be perceived increased political instability in the US and the previous administration’s handling of the Coronavirus.
Chinese and Hongkongers have historically been popular users of the investor visa, and this has intensified in recent times, with these jurisdictions constituting the single-largest source of Tier 1 investors during the last reported quarter. We anticipate that the Q4 ’20 / Q1 ’21 statistics will continue to reflect a higher uptake from Hongkongers in light of the new security laws which continue to cause uncertainty and concern in Hong Kong.
There has been a lot of media attention on the opening of the British National Overseas (BN(O)) route from31 January 2021. Whilst at first blush this may offer a more attractive route to the UK as it has no investment requirements, in light of recent statements from the Chinese government, using the route may have political implications for those who continue to have economic or family ties to Hong Kong, and want to preserve their ability to return. It is for this reason that for those with sufficient wealth, the investor visa is seen as a more neutral option for coming to the UK. Those using the investor visa often do not limit their investment just to that required for the visa, they often employ people here and generate business.
Ultimately the Tier 1 (Investor) Visa applicant plays a vital role in UK foreign direct investment and what will no doubt continue to attract that investment. The key drivers for relocation to the UK remain the top public schools, respect for rule of law, political stability, and the attractiveness of UK real estate as an investment. The very favourable tax treatment offered to international individuals (“non-doms”) also helps puts the UK at the top of the list for those with significant assets.
Whilst the UK has faced significant recent challenges, it has reached a deal with Europe and is on track for the vaccine roll out. The continued attractiveness of the UK, particularly at a time when previously stable jurisdictions are experiencing periods of unrest, means that we may well see an even larger investor visa uptake will be seen in the coming year.