Offshore
Wealthy Investors Shrug Off Brexit As UK Visa Take-Up Soars

Changes to the UK's investment visa regime a few years ago seemed to have blunted its appeal, but recent figures show it remains in rude health.
The number of high- and ultra-high net worth persons coming to
live in the UK rose 40 per cent in the 12 months to the end of
March, reaching a total of 248 and apparently shrugging off
worries about last June’s Brexit vote.
Figures from the Home Office show that Chinese holders of UK
investor visas make up 36 per cent of all such visas, a rise from
20 per cent in the 12 months to end-March 2016.
Tier 1 investor visas, as they called, are granted to individuals
who invest at least £2,000,000 in the UK who pass certain due
diligence checks. When the visa minimum was raised from £1.0
million in 2014, it was feared – with perhaps some justification
– that this change will hit takeup. The change has coincided with
tighter rules on non-domiciled residents, changes in tax
treatment of foreign-owned real estate, as well as uncertainties
around how the UK will execute its departure from the European
Union.
The data, however, suggests that enthusiasm for such visas hasn’t
waned. “In reality the UK’s reputation as a favourable
destination for international HNWs and UHNWs remains undiminshed
by Brexit. There had been a lot of apprehension amongst the high
net worth advisory community but the UK’s huge gravitational draw
is still there,” Charles Filmer, partner and head of the private
office at LJ Partnership, said.
“A year on, the UK continues to be seen as a positive platform
for doing international business. It also continues to offer a
very desirable lifestyle to HNWs and UHNWs,” he said, arguing
that visa-holders seek education for children, a platform for
doing business globally, and a relatively benign tax code,
despite certain changes.
“Relocating to the UK also allows ambitious entrepreneurs from
China, Singapore or Vietnam to turn their business from just
doing deals at regional level to being able to access global
markets and a larger pool of cross border deals. That is hugely
important for ambitious business owners,” he said.
Another firm, Penningtons Manches, which has specialists working
on areas such as immigration, was not quite so enthused over the
data, however, and argued that the fall in the value of sterling
after last June's Brexit vote might have encouraged visa
applications, given that UK real estate became cheaper for
foreign buyers as a result.
“We are seeing a revival of the Tier 1 Investor visa category
with an increase in instructions from HNW clients seeking to come
under this route. This is reflected by the ONS figures which show
a 40% increase in visas granted under this category in the last
year. The figures are still well below those of 2014 when the
initial investment threshold was £1 million, instead of the
current £2 million, but it’s a promising sign,” Hazar El-Chamaa,
partner in Penningtons Manches immigration team, told this
publication in an emailed comment.
“We believe the increase can be attributed to Brexit given the
dramatic drop in the pound and the loss of appeal of the
alternative route of the European citizenship by investment
programmes. The latter has been impacted by the fact that the
status of EU nationals, especially those who arrived/arriving in
the UK post 29 March 2017, remains uncertain,” el-Chamaa said.
A Tier 1 (Investor) visa allows applicants to remain in the UK for a maximum of three years and four months - with the option of extension for a further two years. Applicants need to invest £2,000,000 or more in UK government bonds, share capital or loan capital in active and trading UK registered companies. They can apply to settle in the UK after two years if they invest £10 million; they can apply to settle after 3 years if they invest £5 million.