Self-Sponsorship or the UK Expansion Worker Routes for business immigration?

Expanding your business to the UK market offers incredible opportunities. The UK is one of the world's most dynamic markets, known for its business-friendly environment, strong legal system, and access to a global talent pool. If you're considering establishing a presence in the UK, choosing the right immigration route is crucial.

Two of the most effective routes for business expansion in the UK are the Self-Sponsorship and the UK Expansion Worker routes.

The Self-Sponsorship route: Taking control of your expansion

The Self-Sponsorship ‘route’ is not really an immigration route, but a combination of a Skilled Worker Sponsor Licence and a Skilled Worker visa, with the only addition that the very same company owner will be sponsored by their own company - hence the term ‘self-sponsorship.’

However, this is an innovative option for entrepreneurs who want to set up their business in the UK. This route allows you to establish a UK company fully owned by you, apply for a sponsor licence, appoint the required key personnel, and have your own company sponsor you for a Skilled Worker visa.

Evidently, each of these steps must meet a very rigorous set of rules, and the business you wish to bring to the UK must be demonstrably genuine, but when compared to the old Tier 1 Entrepreneur and Investor routes, the advantages are undeniable.

Investment and economic activity

The old Tier 1 (Entrepreneur) route required a minimum investment of ￡200,000. Its close sister route, the Tier 1 (Investor) visa, established a minimum investment of ￡2 million. Furthermore, they both imposed strict limitations on the type of investment and economic activity, especially related to property investment and management.

Non-commercial requirements

If you wanted to extend your stay in the UK under the Tier 1 (Entrepreneur) route, you were required to create a minimum of 2 full-time jobs for settled workers. This was, of course, positive for the UK economy and the local workforce, but was it positive for your business? Not necessarily.

Your business might still have been struggling to take off, or you might have needed a couple more years to fully develop your business plan. However, this was irrelevant to your extension or ILR application; if you wanted to remain in the UK, you had to employ two settled workers.

Instead of focusing on your product or service, or on the market, the economy, business trends, client response, and any other business indicators, you needed to make sure that you had the minimum number of new full-time jobs filled in by local workers, regardless of whether they were the most suitable or qualified.

Starting a business is already difficult, with most businesses failing in their early years. When you add an additional number of non-commercial and mandatory considerations to this equation, you may have yourself a perfect storm leading to bankruptcy.

How is the Self-Sponsorship ‘route’ different?

Put simply: with the Self-Sponsorship ‘route’, you only need to worry about commercial considerations. That’s it. You can run your business in the UK like any other person, focusing only on your product or service and on the market conditions.

There is no minimum investment or turnover. You may very well lose money in your early years as it is frequently the case with new businesses.

There are no limitations as to the type of business or your chosen economic field. You may invest and develop your business solely around the London property market if you wish (if you are bold enough to compete with the rest of the world…)

In sum, you can run your business on a purely commercial basis and this business can sponsor you and your family to settle in the UK, even if you own 100% of its shares.

The UK Expansion Worker route: a different approach for established businesses.

The UK Expansion Worker route is designed for businesses already operating outside the UK and looking to open a new branch or subsidiary in the country. This route is part of the Global Business Mobility (GBM) scheme and is ideal for businesses that want to send senior employees or specialists to the UK to oversee the expansion.

The UK Expansion Worker route simplifies the process of entering the UK market. It allows your company to send key personnel to the UK (including the majority or sole owner of the company) to set up and manage the new branch or subsidiary.

Unlike other visa routes, the UK Expansion Worker route does not require your company to have a sponsor licence before applying, in fact, if successful you will be granted the licence before you fully form your company in the UK.

Advantages

You don’t need to wait until your company is ready to trade in the UK to apply for the sponsor licence. A commercial lease or the incorporation of your branch or subsidiary with Companies House is sufficient for the company to apply for a licence. Once this is granted, you can sponsor yourself as the company director and come to the UK with your family to oversee the expansion of your business.

Furthermore, you don’t need UK based staff (as you do with the Self Sponsorship ‘route’). Once the licence is approved, you can sponsor a senior representative (including yourself) to come to the UK and finalise the setting up of your branch or subsidiary and, in general terms, launch your UK business.

Limitations

You must have a pre-existing business overseas with at least 3 years of operations, so you cannot start a wholly new business in the UK under this route.

This is a not route to settlement; it means that any sponsored worker will only be able to remain in the UK for a maximum of 2 years under this scheme. If they wish to remain in the UK for longer, or indefinitely, they will need to change their immigration route, and the two years already spent in the UK will not count towards any valid residence requirement in an application for Indefinite Leave to Remain.

Combining the two routes

In general terms, you can combine different Sponsor Licences under the same company or business. Hence, the residence limitations of the UK Expansion Worker route may be overcome by the subsequent addition of the standard Skilled Worker route to your already existent UK Expansion Worker licence.

Once the new route has been added to the licence, any migrant workers with a UK Expansion Worker visa (limited to 24 months) will be able to switch to the standard Skilled Worker route where, after 5 years of continuous residence in the UK, they will become eligible for Indefinite Leave to Remain, and 12 months after that, for British citizenship provided all other criteria is also met.

Conclusion

Expanding your business to the UK can be a game-changer, but it requires careful planning and choosing the right immigration route. The Self-Sponsorship and UK Expansion Worker routes offer tailored solutions depending on your business stage and goals. Self-sponsorship gives you the autonomy to start and grow your business in the UK, while the UK Expansion Worker route provides a strategic pathway for established companies to enter the UK market with the support of key personnel.

To discuss your options for setting up a branch or subsidiary of your business, or creating a new business in the UK, please contact Paolo Barbato at [email protected].

The information contained in this article is general guidance only. The application and impact of laws can vary widely depending on the specific facts involved. The information in this article is provided with the understanding that the authors and presenters are not giving legal, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with professional legal, tax or other competent advisers. Before making any decision or taking any action, you should consult a Child & Child professional.