One of the lesser well known services that we provide as chartered accountants in London is the production of letters confirming income or savings, for various different purposes. One of the more common is for those applying to the UK Border Agency (UKBA) for a Tier 1 visa.
What do I need to prove for a tier 1 visa?
All Tier 1 visa applications work on a points system, whereby you must qualify for a certain number of points through various measurements. For general visas, the number of points you require is 95. One of these is an assessment of your previous earnings, for which there is a potential 80 points available. The UKBA will look at your gross and net earnings in a 12 month consecutive period normally within the 15 months prior to your application.
The earnings assessed can include the following (for a more extensive list, visit the UKBA website):
- Earnings from Self-employment
- Allowances that form part of your remuneration package
- Property rental income, if this is your primary business.
They will not consider the following:
- Investment dividends (unless it is your own company)
- Savings interest
- Funds that were inherited
- Pension payments
- Ordinary rental income
This is normally done by reviewing the bank statements for the relevant period, and comparing it to income statements (for example, employment payslips, or any invoices you make if you are self-employed).
So why do I need a chartered accountants letter? Surely I can just give my payslips and bank statements?
The UKBA requires two different types of document for each source of income. So for example, to confirm your salaried income, you could not provide both payslips and a letter from your employer, as these are from the same source. You could alternatively provide the bank statements for the period or a letter from a chartered accountant detailing the income.
Likewise, for self-employment income, you could provide the invoices you have given to your clients, as well as bank statements or a chartered accountant’s letter.
Also, note that the UKBA require the letter to be written by a member of a recognised professional body, specifically the ICAEW (Chartered Accountant) and the ACCA (Chartered Certified Accountant). There is no license requirement for people to call themselves or practise as an accountant, so make sure that you are dealing with a member of the ICAEW or ACCA.
What about other types of tier 1 visas?
There is more than one type of tier 1 visa, related to different groups of people. These have different income requirements. For example, the Tier 1 (Entrepreneur) visa requires access to either £200,000, or not less than £50,000 and you are applying for leave to remain. In this situation, a chartered accountant’s letter detailing your income is highly recommended. Tier 1 (Investor) visa requires a minimum of £1,000,000 available to invest in the UK.
Generally, a letter from a chartered accountant will summarise all sources of income to be assessed, and so can be used as a second source for several sources of income. If you are applying for a tier 1 visa, and you think you may need a letter to support you proof of income, discuss it with your lawyer or chartered accountant.
We’re also trusted London contractor accountants. If you’re a contractor and need assistance with your finances, get in touch to see how we can help.