Buying your way into the UK

Property prices in London have challenged economic conditions in the past decade. There is a simple reason for that. There are just too many rich foreigners coming to the UK. It's quite easy to explain. Not only the is the tax system attractive for them thanks to the non-domicile status but it's quite easy to obtain a Visa if you are ready to bring in enough money into the British Economy. In many jurisdictions, obtaining residence visas can be fraught with red tape, delays, quota restrictions and other hidden difficulties, often resulting in refusals of such applications. Not so in the UK. Here are the options:

The Tier 1 Entrepreneur Visa

The basic requirements for the initial visa are that the individual needs to show evidence of having £200,000 available to invest in the UK and needs to be able to speak English.

Then, after three years, to secure the two-year extension the individual must show:

• That they were appointed as a director of a UK company within six months;
• They have invested £200,000 in a UK business via equity or unsecured loan;
• Evidence that their investment has resulted in the creation of the equivalent of two full-time jobs for 12 months;
• They spent 185 days per year in the UK.

The Tier 1 Investor Visa

This Visa is becoming more and more popular amongst wealthy individuals and their families as a means of obtaining UK residence. The number of investor visas granted increased from 43 in 2008 to 320 last year. The largest number of investor visas was issued to Russian nationals at 27% followed by Chinese investors at 15% since it was introduced in 2008. The main requirements are:

• The applicant must have £1milion of their own funds (including assets of spouse or partner) or £2m of personal wealth with borrowings from a UK bank of £1m.
• The capital must be invested within 3 months of arriving in the UK
• 75% must be invested in "specified investments" – generally UK government bonds, shares or loan capital in active UK trading companies
• This can include an investor's own business
• The remaining 25% can be invested in unmortgaged UK property, cash or significant works of art
• The investor may bring spouse, partner and dependent children under 18
• No English language requirement
• The investor and dependents may work or study in the UK
• Can spend up to six months of the year outside the UK

And after 5 years, the applicant will obtain "indefinite leave to remain" in the UK leading next to a UK passport. It can even be accelerated to 3 and 2 years for investments of £5m and £10m respectively.

No wonder property prices in London have been defying gravity for all those years!