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  1. Wealth
February 25, 2016

Will Brexit spell the end for investor visas?

By Spear's

Aurea Kevill says the government is keen on making life harder for skilled and wealthy migrants to the UK

Following David Cameron’s recent return from Brussels and MPs various declaring themselves for the ‘in’ or ‘out’ campaigns, ‘immigration’ (in whatever guise) is very much a hot topic.

The seemingly endless changes to various visas for potential investors and highly skilled migrants suggest that the government is closing the nets on their migration to the UK by making it increasingly difficult for applicants. This is despite the government’s insistence that it ‘wants to attract talented individuals to live in the UK who will help to contribute to the success of this country by investing here and creating jobs’ (‘Non-Dom’ Consultation Paper, published on 30th September 2015). The Tier 1 (investor) category (the investor visa) is for high net worth individuals making a substantial financial investment in the UK.

Less than 18 months ago the required investment fund for an Investor Visa was increased from £1 million to £2 million (the investment amount). In addition, increasing restrictions were introduced on how the funds could be invested. For example, the ability to invest 25 per cent of the investment amount in residential real estate has been removed.

These changes have drastically reduced the number of applicants for Investor Visas. In the second quarter of 2015 only 44 investor visas were granted compared with 251 in the second quarter of 2014.

Two members of the House of Lords have recently tabled an amendment to the 2015 Immigration Bill in which they propose to abolish the Investor Visa route altogether. They have expressed doubts as to the benefit to the UK economy and it is possible that they are still concerned that the visa is being used by criminals, despite the fact that applicants are now required to provide criminal record checks. It is not yet clear whether this proposal will go through. However, the government is clearly intent on increasing the obstacles for potential investors moving to the UK.

Tier 2 is the route which enables UK employers to employ nationals from outside the resident workforce to fill particular jobs which cannot be filled by settled workers. In June 2015 the government commissioned The Migration Advisory Committee (the MAC) to publish a report on the Tier 2 route, the feeling being that employers had become overly reliant on migrant workers to fill shortages in the UK. The report makes various proposals (which are likely to be implemented). The stated aim of the proposed changes is to make the Tier 2 route more selective showing that the government is also making it increasingly difficult for Tier 2 route applicants.

It will be interesting to see whether the outcome of the referendum will have any knock-on effect on the government’s apparent policy on skilled and wealthy migrants – not least because if the ‘out’ camp wins, the status of those EU nationals wishing to work in the UK will have to be reviewed.

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Aurea Kevill works at boutique private wealth law firm Maurice Turnor Gardner LLP

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