New Immigration Applications for the Post-Brexit world

What does the UK’s post-Brexit immigration landscape look like? Certainly for European nationals the era of free-movement is over, however despite the long arguments about immigration control during these last few years, the immigration picture does look favourable for some.

Sponsorship Licence and Skilled Work

According to the released Home Office “Sponsorship Transparency Data” there has been a 3-fold increase in the number companies applying for a Sponsorship Licence to hire foreign workers, from approximately 2,000 per quarter before the Brexit-transition date, to 6,000 per quarter after the Brexit-transition date.

These figures clearly show that UK companies continue to need foreign workers to plug labour-shortage gaps, and with the ending of European free-movement these gaps are being plugged through the Sponsorship Licence scheme. Any UK employer looking to hire non-UK national staff needs to obtain a Home Office Sponsorship Licence. The main criteria for that application include proving to the Home Office that your business is a viable concern (in other words that you have the revenue and profit margins to take on the commitment of new hires), and that you will follow all the Home Office rules and regulations in relation to the licence, including Human Resources (HR) standards.

An application needs to supply certain key documents proving the financial health of the business, such as the latest accounts and Corporation Tax returns and bank statements. The rules a business needs to comply with are detailed, but broadly speaking they involve the company immediately reporting to the Home Office any issue with the foreign worker, or indeed reporting any problem with the compliance of the licence and the HR standards.

The most common form of Sponsorship Licence is what is known as the “Skilled Worker” licence. This is an important factor for businesses – this scheme is designed for the employment of highly skilled migrant workers, and not low-skilled workers. The Home Office publish a list of what constitutes highly skilled work, and there are roughly 65 different job titles ranging from; various management titles in the retail/hospitality and the corporate sectors, IT and digital services specialists, specific engineering or scientific positions, specific positions in healthcare, and many others. We are happy to have discussions with you about whether your intended hires can fall under one of these categories.

The Start-up and Innovator Visas

Another post-Brexit reform has been the introduction of the Start-up and Innovator visas. They are two different applications, though there is a great deal of similarity between them. The Start-up visa is aimed more towards young people who have no prior business experience such as University graduates. The applicant needs to put together a business plan that shows that their business idea is; a new idea, innovative, and commercially viable. This business plan needs to be endorsed by a reputable institution, and the most common endorsing body for the Start-up visa is the applicant’s former University. Indeed many UK Universities now have specialised teams to help guide their current and former students through the endorsing process, and the Universities have set this system up in partnership with the Home Office. There is no set investment amount required for the Start-up visa, which is one key factor different from the Innovator visa.

For the innovator visa an applicant needs a minimum of £50,000 to invest in their business idea, and this application is tailored more for experienced entrepreneurs. As such, the requirements for the business plan in this route are a little more stringent and obtaining the approval of an endorsing body can be a little more challenging. The most common endorsing body include the various start-up incubators or seed-capital investment funds around the UK, and each of these institutions has its own requirements for admission on to their programmes and have different processes for endorsing a business plan. bruno rodrigues solicitor However, one key element to the Innovator visa is that the business plan must be innovative – in other words your business idea must use a new technology, or comprise of a new product or be a business venture that is truly new to the UK market. The Brooke Consultancy can assist you in the process of putting your business plan together and liaising with endorsing bodies.

 

Conclusion

The immigration picture remains favourable for businesses who need to hire skilled foreign workers and for migrants with specialist knowledge and entrepreneurs with new ideas. At the Brooke Consultancy we would be happy to hear from you if you found this article interesting to solve your immigration needs.

– Bruno Rodrigues, The Brooke Consultancy

Posted in Blog | Tagged , , , , , , , , , | Comments Off on New Immigration Applications for the Post-Brexit world

UK: Employment relations now and then

I have been an Employment lawyer for over twenty years both in-house and as a partner in several central London law firms. In that time Employment law has changed dramatically.

To begin with the EU vastly increased employment rights and even though we have gone through Brexit we are still bound by EU Directives such as the much disliked Acquired Rights Directive (TUPE) or the Human Rights legislation. We remain tethered to these European laws even though we have left the EU.

Of equal importance is the Equality Act 2010 which incorporates in one single act all of the different strands of discrimination and adds further new claims such as associative discrimination and discrimination arising from a protected act.

In terms of employment litigation, no longer do Employment Tribunals fulfil their original purpose of being informal venues where employees can turn up unprepared on the day of the hearing with bundles of papers and without witness statements.  Employment Tribunals now follow almost the same rules as the civil courts in England and Wales.  Rightly or wrongly today’s employees know their rights and it is rare for either side not to have a barrister. There are also costs consequences if either party get it wrong or abuse the system.  It should also be borne in mind by employers though that Tribunals are often more generous in their attitude and interpretation towards employees.  All in all defending Employment Tribunal claims can be an expensive business.

In Autumn 2022 the Bank of England has warned us to expect two years of harsh recession and financial instability with interest rates soaring meaning that the costs of borrowing money will increase significantly which has knock on effects upon investment, loans and leasehold premises.

office environment

For employers this often means looking at ways to streamline their companies whether by outsourcing or restructuring. Inevitably this will mean redundancies and other job losses or closing down altogether.

Companies often hold the view that if they are in difficulty this means that they can side-step  the processes. This is untrue as a business will only escape liability if it is insolvent and has no assets. If a company needs to downsize it is always more cost efficient to conduct the process properly with clear communication networks for employees.

Transparency is key. This means not excluding affected employees from meetings and emails, and having whispered conversations behind closed doors which all create suspicion, division and rumours inevitably leading to problems within terms of employment

Some employers use the instruction to reduce headcount as an opportunity to get rid of the ‘old guard’ or underperforming employees without going through proper processes. This does not work and any attempts to side step due process will inevitably be picked up by employees’ legal representatives.

In cases of Individual terminations for senior employees or where it is necessary to strip out a layer of management this can potentially be achieved through short cuts such as ‘protected conversations or ‘without prejudice’ discussions.  The rules relating to such discussions however are prescriptive and there are penalties if you get in wrong.

Employment law is no longer an area of practise to be tagged on to other areas of expertise such as Human Resources or Corporate law. There are frequent traps and complexities which must be considered and advised on by a specialist.

by Lynne Burns

the founder of LB LAW,  & Collaboration Partner – The Brooke Consultancy

(photo source: IsraelAndrade / Unsplash)

Posted in Blog | Tagged , , , , , , | Comments Off on UK: Employment relations now and then

Brexit – Exporting to and from the EU now

The UK has left the EU customs union, single market, and VAT area. The Trade and Cooperation Agreement (TCA) sets out the terms of UK trade with the EU from 1 January 2021.

This article is a general overview of some of the issues arising from trade with the EU.

Businesses find dealing with the amended import and export procedures challenging. Below are the main sources of information which may help people dealing with questions about customs rules.

The Government’s Border Operating Model (June 2022) is a comprehensive guide on customs processes, both for imports from and exports to the EU. A Government explainer contains an overview of customs formalities for UK-EU trade. More information about the Model is available below.

handshake - successful business

European Commission Guidance Brexit: Now that the transition period has ended, new rules on taxes and customs answers the most common questions about EU customs rules. More detailed EU technical guidance is available.

Action if you wish to export to the EU: You need to familiarise yourselves with new processes. These include: preparing to make customs declarations, knowing how to classify your goods and following safety and security requirements.

Making customs declarations: You must submit customs declarations for all goods exported from and imported into the UK (excluding those from Ireland). In some cases, a business may submit a simplified declaration.

Classifying goods: You are responsible for correct classification of goods and recording of the origin of goods. Incorrect commodity codes or inaccurate recording of origin in customs declarations may mean that the wrong amount of tax or duty will be charged. You may classify your goods yourself but HMRC often advises getting help from customs intermediaries to ensure that goods are classified correctly. More information is on GOV.UK: Claiming preferential rates of duty between the UK and EU.

Follow Safety and Security Requirements

The EU requires safety and security declarations on imports from and exports to the UK. The UK Government does not currently require these declarations for imports from the EU. When exporting from Great Britain to the EU, you will generally have to make an exit summary declaration.

You can find information on customs and tax rules through various UK government channels:

The government has launched an Export support team hotline and online enquiry service for businesses exporting to the EU and further assistance is available as follows:

HMRC trade tariff tool can be used to check the applicable UK tariff duties and VAT rates.

Government Border Operating Model recommends, because customs declarations can be complex, that businesses use customs intermediary who can do this on their customers’ behalf. HMRC has lists of customs agents and fast parcel operators.

European Commission has a taxation and customs information website and you also need to consult in individual cases, the EU Member States to which you are exporting customs authorities.

Customs & International Trade Helpline number is 0300‌ ‌322‌ ‌‌9434. See also GOV.UK Brexit transition helplines.

Export support team hotline an online enquiry service for businesses exporting to the EU.

HMRC offers webinars and short films about importing and exporting.

Northern Ireland

Businesses moving goods between GB and Northern Ireland can use the free Trader Support Service, which provides information and can complete declarations on their behalf.

Free trade and support service is for businesses moving goods between GB and Northern Ireland.  The service provides information and can complete declarations on your behalf.

A GOV.UK guide explains how businesses can export food, drink and agricultural products.

Compliance with Rules of Origin will allow your goods to be exported under the TCA on the basis of zero tariffs and quotas.

TCA secures zero tariffs and quotas on goods moving between the EU and UK, if those goods meet the rules of origin (RoO) which determine the “economic nationality” of goods based on where the products or materials (or inputs) used in their production come from. They prevent goods manufactured in third countries being routed through the UK (or the EU) to avoid paying third country tariffs.

The goods have to meet the ‘Rules of Origin’ requirements set out in the TCA. These rules relate to the amount of UK or EU content in a particular good and the amount of processing which goods undergo in the UK or EU before export. Together these determine whether goods qualify as UK or EU originating and therefore qualify for zero tariffs and quotas. Goods that have not been sufficiently produced or processed in the UK or EU cannot be re-exported tariff free. The VAT and excise rules that apply to goods coming into or leaving the UK from or to EU countries and non-EU countries are now the same.

A product qualifies as ‘originating’, if it is ‘wholly obtained’ in the UK and EU, or has been substantially transformed in one or both markets. Businesses that re-export goods from third countries with little or no further processing, may still face tariffs when trading with EU Member States.

RoO can be onerous. In some cases, the rules are specific to particular products. Some businesses cannot or do not wish to claim zero tariff because of the complexity or cost of the paperwork and due to the complexities, a substantial number of businesses do not claim zero tariffs when exporting to the EU.

You will need to meet EU regulatory requirements. Where conformity assessment procedures require approval from a third party conformity assessment body, you will need to obtain certification in both the UK and the EU if your products are to be sold in both. The UK Conformity Assessment (UKCA) mark will be used to demonstrate compliance of products in the UK, whilst the CE mark will continue to be used to demonstrate compliance of products in the EU.

Bio Security Requirements

If you move, buy or sell animals or plants, or their products from or to the EU, you now need to comply with rules for protecting human, plant and animal health to ensure that you can continue to trade freely, such as health certification, new biosecurity requirements and border checks. Certain animal products such as chilled meats (e.g. sausages and mincemeat) and some plant species can no longer be exported to the EU.

 

EU Customs controls: They ensure that duties are paid on goods moving across the border, and check compliance with safety, security, health and environmental requirements and the EU has introduced full customs controls.

UK Government Border controls

Border controls for goods imported from the EU are being phased in for customs declarations for all goods.  This includes further health certification and sanitary and phytosanitary (SPS) checks on agri-food products, physical SPS-checks on EU imports at designated Border Control Posts, and a requirement for safety and security declarations. However, the UK Government is seeking digital solutions for the border and exploring new technologies to reduce friction and costs for businesses and consumers. The new target date for a reassessed import control regime is the end of 2023.

The TCA commits the UK and EU to hold regular reviews of their respective border controls with the aim of reducing the burden of such controls to facilitate trade without compromising biosecurity.

Disclaimer

This article does not address the specific circumstances of any business.  You cannot rely upon it as legal or professional advice, or as a substitute for it. We do not accept any liability whatsoever for any errors, omissions or misstatements. You need to consult a suitably qualified professional if you require specific advice or information. Read our briefing for information about sources of legal advice and help.

Photo: Katemangostar / Freepik

Posted in Blog | Tagged , , , , , , , , , , | Comments Off on Brexit – Exporting to and from the EU now

UK Immigration Rules: New routes – An Update

In our last blog post, we set out the Government’s planned changes to the system for UK work visas. Since then, the Government has implemented those changes, so we can now see better what they mean in practice.

Investor Visa

There remains no further guidance from the Government on how exactly they plan to replace the Investor Visa route through changes to the Innovator Visa category. For now, the system for UK work visas generally continues to be focused on migration for employees, rather than for self-employed / independent business people.

Global Business Mobility

Following Brexit, the Government has tried to make the UK more attractive to overseas businesses. It has signed a number of free trade agreements and created various freeports. Some of those businesses want to send their overseas personnel to the UK to set up and run their UK based business.

This is possible through the UK Expansion Worker route, which came into force on 11 April 2022 and which has received its first applications. First, the overseas business creates a branch or wholly-owned subsidiary in the UK. The UK based business applies to the Government for a sponsor licence, before it starts trading in the UK. It applies for a Temporary Worker licence, allowing it to sponsor workers on the UK Expansion Worker (Global Business Mobility) route. This is an online process, involving completion of an application form with information about the business; and supporting documents as evidence for the business.

The key, general requirements for sponsor licence applications are: clear background checks for personnel; appropriate HR systems; and suitable jobs and pay. The UK Expansion Worker route is for senior managers or specialist employees, assigned to the UK to work on the business’ expansion to the UK; and this route requires credible plans to expand to the UK. Careful preparation of the sponsor licence application is key – if the Government refuses the application, it will generally be necessary to wait for at least 6 months before applying again. This would cause a major delay for the business’ planned expansion.

Normally, the Government makes a decision on sponsor licence applications within 8 weeks. It is now making it easier to fast track applications, charging a fee for a decision within 2 weeks.

Once the business has its sponsor licence, it gives a certificate of sponsorship to its key person – its authorising officer – to enter the UK. That person uses the certificate to apply for a UK Expansion Worker visa. Once they have their visa, the business can start sponsoring more people to help with the expansion to the UK.

With the UK Expansion Worker route, the Government has provided a way for overseas businesses to expand to the UK. Over time, we will see how attractive this is, particularly in comparison with the previous Sole Representative route.

High Potential Individual

Many overseas students have expressed an interest in this new route, which allows recent graduates of certain leading global universities to work in the UK. It contributes to an improved range of visa options for young people looking to move to the UK to start their careers here. Generally, these options do not lead to permanent residence in the UK, so it will often ultimately be necessary to find sponsorship from a UK based business.

Scale-up

This new route came into force on 22 August 2022, so its impact is not yet clear. Many scale-ups may be reluctant to take on the regulatory burden at their stage of business. However, this remains one of the few visas that can lead to permanent residence in the UK, which is a rare feature for UK work visas.

Conclusion

These are the key changes that the Government has introduced. Having said this, we now also have a new Prime Minister, so there could be further changes soon. Watch this space!

by Usman Sheikh,

the founder of Ansar, & Collaboration Partner – The Brooke Consultancy

(photo source: Rawpixel / Freepik)

Posted in Blog | Tagged , , , , , , , , , , | Comments Off on UK Immigration Rules: New routes – An Update

Understanding the Legal Side of Naming and Branding

A brand name is the first thing customers hear when engaging with a product or service creating a sense of association.

Building a brand is one of the most strategically important decisions business owners can make – strong brands command price premiums, engenders customer loyalty and generates higher returns for the business and investors who will in fact become your shareholders.

A statistic – Up to 80% of consumers prefer to buy a product from a brand name they recognize.

What you need to consider

Own your name – it’s your intellectual property.  Trademark it, register it as your IPR as that will create a financial value for your company, it will sit on the balance sheets as an asset.

If you cannot patent and you want to talk to other people about joint ventures or deals, you may wish to have a confidentiality and non-circumvention agreement to prevent the idea being used by the person with whom you are negotiating or people that you deal with.

Trademark the name and where appropriate patent the change that effected.  It will sit on your balance sheet as an asset that feeds into access to finance because by naming and branding that enables your accountants to put together financial projections that are consistent and supported by fair and reasonable assumptions.

Naming is a crucial part of brand building and must be in alignment with the overall strategy.  Taking a couple of examples:

1.     A new innovative and sustainable fashion brand for young people, so in addition to branding and naming there is strategy, art direction and packaging but they are in fact add ons.  It was necessary to communicate the brand’s youthfulness, vibrancy, energy and corporate values “I am chemical free, I am the most sustainable garment on the planet”.

2.     An old established dairy producer: The market is dairy free brands fighting for market share.  Given its history, this company decided to disrupt dairy with free range natural and sustainably packages delicious dairy products and to concentrate on continuity of the product.  The differentiator for them was their free-range cows who are fed the finest feed, played music while they are milked and have their own beds and get their back scratched.  So the challenge here was the company wanted to retain its legacy whilst also firmly positioning itself as the go to dairy brand for now and the future.

What lessons can be learned

1.     Know the market for your product/service.

2.     Know your demographic

3.     Know the amount of the market that you need to capture using your name and brand.

4.     To unlock your social benefit and value, the key is the naming and branding or, in other words, do you satisfy the criteria that investors are increasingly looking for of ESG – Environment, Social Benefit, Governance.  Governance means how you run your company and communicate its corporate values.

If you want to know more about the creative and communication perspective of names and brands, then read this detailed article written by Sabine Raabe, a high calibre PR and Public Affairs Practitioner and our Collab Partner.

When it comes to naming and branding it is best if you have a branding specialist. It’s important to maximise the value of the intellectual property rights you have created by naming and branding, there is financial advantage to your business and investors by providing access to finance.

(photo source: vectorjuice/Freepik)

 

Lynne Brooke

The Brooke Consultancy

Posted in Blog | Tagged , , , , , , , | Comments Off on Understanding the Legal Side of Naming and Branding

The Growing Importance of Litigation PR

Let’s talk about Johnny Depp and Amber Heard. Heard sacked her PR team mid-trial, reeling from bad press with hashtags like #JusticeforJohnnyDepp racking up 3 billion views on TikTok. The Court of Public Opinion had firmly turned against her, and the case is a perfect example of the growing importance of litigation communications in the digital world. Not all cases occupy the tabloids quite like the ‘Wagatha Christie’ libel trial or Depp vs. Heard, however, personal, financial, and corporate litigation can easily make the headlines, propagate on social media, and leave a long-lasting damaging digital footprint.

Monitoring and managing what is said about the client is therefore critical and this is where Litigation PR comes in. Litigation public relations is the management of the communication process during the course of any legal dispute so as to affect the outcome or its impact on the client’s overall reputation. Litigants and Law Firms have always used the media to get their side of the story across and the practice of Litigation PR originally evolved out of crisis communications.

Litigation PR is a specialised practice in that the aim is tied to supporting a legal dispute and any communication about the case can have legal implications, given the sensitive rules around disclosure during courts proceedings. Litigation communications and reputation management can be necessary for cases across all practice areas. Generally, the two parties have important interests to defend that expand way beyond the legal case. Negative publicity about a company or individual can cause damage to the overall reputation that even a courtroom win may never salvage.

litigation pr reputation management

A Litigation PR expert who understands the court process and legal strategy will guide the client on communication and develop the appropriate strategy, both in terms of the case, and the publicity that comes with it. For many cases the goal is to keep any mention of the case out of the press altogether. Litigation PR can even be an effective tool in bringing the other side to the table to settle a dispute to avoid negative publicity.

Although the practice of PR involves far more than just media communication, Litigation PR remains dependent on the media. At a time when society is growing more litigious, the media focuses and in fact seeks out publicly filed lawsuits. It is important your Litigation PR Practitioner knows how to pre-empt adverse publicity that could impact the entire strategy of a legal case. Clients need to know whether there will be news coverage of their case, how to tell their story to correct any misleading impressions, protect their business interests, the share price of their company, and even ability to access finance.

Because typical public relations campaign strategies and tactics may not be appropriate and may even be harmful at certain times during a lawsuit, the strategy must follow due legal process. Litigation PR is more regulated so as not to prejudice the legal process. Whatever the practice area and nature of the case, the Litigation PR practitioner will conduct a reputation risk analysis with a comprehensive media and online audit, and background research exercise. This provides insight into any likely source of negativity to be involved, what they might say, what online assets exist, what the social media footprint is like, and who the interested parties are.

Depending on the finding of the reputation risk analysis, the communications and Litigation PR strategy for every case will be different. If a case is already out in the public domain there is the need to take control and have a say in the way a case is reported. Other times it may be better to sit it out and only speak out if the need arises. In all instances, being prepared and responsive in real time is always in the client’s best interests.

Litigation PR is highly strategic and requires experience, knowledge of the legal process and a close working relationship with the client’s legal team. Lack of co-operation and communication can lead to the most solid case derailing which will ultimately be costly for the client and may lose them their business and reputation. Litigation PR should be seen as part of sound brand management in protecting underlying brand value for the long term.

(photo source: Mauro Gigli/Unsplash)

by Sabine Raabe

PR Specialist, Enlightened PR

Collaboration Partner – The Brooke Consultancy

Posted in Blog | Tagged , , , , , , , | Comments Off on The Growing Importance of Litigation PR

Opportunities for overseas companies: Doing business from the UK

Overseas companies can do business from the UK by establishing a presence in a UK Freeport with accompanying tax advantages. It can be for services or goods, and then sold on the internal market or exporting tariff free to countries with which the UK has a Free Trade Agreement e.g. Canada, Japan, Australia, New Zealand.  Tax will have to be paid in the UK by the company, but it will be subject to relief by virtue of a Double Taxation Agreement.

The G7 has always helped drive wider international action. During its presidency, UK has supported specific objectives with which we can all agree with:

– End the pandemic and prepare for the future. Although the pandemic seems to be on the way out we still have to plan for the future

– Reinvigorate our economies by championing freer, fairer trade

– Protecting our planet by supporting a green revolution

– Strengthening partnerships and embracing values to harness power of democracy, freedom, equality, rule of law and respect for human rights.

Now that the UK has left the EU and entered into the Trade and Cooperation Agreement, we feel our obligation to our fellow citizens to help achieve economic growth.

Although the UK has left the EU, it has not altered the fundamentals of sound business.

The UK:

– is the 5th largest economy in the world,

– has a 67m population,

– its GDP ranks 5th in the world

– growth companies have a Hi tech focus, and

– bureaucracy is limited.

There are many other ‘Incentives’ including

– low corporation tax levels

– favourable employment laws and lower labour costs

– availability of venture capital for innovative growth companies

It is a priority of Government to attract Foreign Direct Investment and to have Free Trade Agreements worldwide.

The UK has established FTAs with 19 countries some very small but 6 are with larger countries like Japan and Canada.

While the UK has always been open to FDI, below you will see the types of services provided by the Office for Investment established as part of the Department of International Trade.

– Business intelligence gathering

– Providing expert advice on sector specific issues

– Identifying priority sectoral opportunities

Trade and investment hubs have been created in Edinburgh, Cardiff, Belfast and Darlington as homes to teams of export and investment specialists.  Services are provided to overseas investors and investable projects are being developed to be put in front of overseas investors.

Freeports unlock new investment opportunities, drive growth, support trade, innovation and commerce. There are currently 8 Freeports. Successful businesses will be able to access a share of £200m of seed capital. Economic incentives related to tax, customs, business rates, planning, regeneration:

– Enhanced structures & building allowances, plant & machinery allowances

– Stamp Duty Land Tax relief

– Business Rates relief

– Employers National Insurance contributions.

Although the UK is no longer a portal to the EU, it has taken up the position of being a portal to overseas companies that are resident and trade from the UK in Free Trade areas that have been negotiated.

One of the examples is the FTA between the UK and Australia. It sets out new global standards in digital and services, and creating new work and travel opportunities in both countries:

– UK firms to bid for an additional £10bn worth of Australian public sector contracts

– Allows young people to work and travel in Australia for up to 3 years at a time free from visa conditions

– UK service suppliers, architects, scientists, lawyers, accountants will have access to visas to work in Australia

– Removes tariffs on all UK exports so cheaper to sell cars, whisky, UK fashion and vice versa

– Further UK objective to join CPTPP

It is anticipated that the FTA with Australia will unlock £10.4bn of additional trade and eliminate tariffs. It is a gateway to the fast growing Indo Pacific region and will boost UK’s bid to join Comprehensive and Progressive Agreement for Trans-Pacific Partnerships (CPTPP).

To mention some interesting business-related examples: A Slovenian company that exports to Australia with which the EU has no trade agreement could make up their products in a UK Freeport and then export tariff free to Australia. There is also the example of rum being imported to the UK, bottled here in unique get-up in a Freeport and then exported tariff free to large markets in Canada and Japan.

India is UK’s 15th largest trading partner. India has a large middle class of consumers, and it is growing, and is set to become the World’s third biggest economy by 2050.  Investment from Indian companies already supports 95,000 jobs in the UK. The ambition is to double bi-lateral trade to £28bn by 2035. [Ann-Marie Trevelyan, International Trade Secretary at DIT]

We as a firm are looking to bring Indian hi tech unicorns to the Aquis market in London to raise capital and we look to suggest a similar strategy for other overseas companies, such as Turkey, for whom we act.

Presently there are 11 CPTPP members and up to 90% of the world growth is expected to be outside Europe over the next 5 years.

In addition the UK has a free trade agreement with Guyana and the CARIFORUM group of countries following the UK’s exit from the European Union. CARIFORUM is made up of the member nations of the Caribbean Community (CARICOM) and the Dominican Republic.

It seems that the strategy of entering into FTA’s worldwide is feasible and makes economic sense. More importantly, overseas companies, and they need not be wholly owned by the parent, trading from the UK can involve themselves in the growth of FTAs negotiated by the UK and take advantage of the fundamentals of doing business in the UK.

We have always believed in the strength of people working together in international markets because it encourages diversity and respect and mutual trading is, we believe, an engine of stability and peace. That accords with the G7 objectives with which we started.

Lynne Brooke

The Brooke Consultancy

Posted in Blog | Tagged , , , , , , , , , , , , | Comments Off on Opportunities for overseas companies: Doing business from the UK

Protect your business and yourself

Many years ago, I failed to take my own advice to protect my business and myself by having a cross option agreement sometimes called a double option agreement and my partner and I failed to take out policies on each other to cover death or incapacity.

It’s relatively simple in the sense that if your co-shareholder or partner whether in a limited liability company, a limited liability partnership or partnership dies, then that person’s share passes under their estate to a spouse, friend or other person who benefits under their Will or intestacy.  That means that as the continuing shareholder you will find yourself in business with someone you don’t know or if you do, knows little or nothing about the business.

To deal with this you need a cross option agreement and it’s in that format to save HMRC arguing that it’s a sale and purchase agreement and collecting tax.

Under the double option agreement, the continuing shareholder has the right to exercise a Call Option, that is for them to buy the shares.  The estate of the deceased shareholder has the right to exercise a Put Option, that is to require the continuing shareholder to buy their shares.

Each of you take out and hold on trust for the other an insurance policy only to be used to buy shares if your co-shareholder/partner dies or loses capacity.  Losing capacity, unless the parties agree, needs to be judged by an independent specialist experience in assessing capacity under the Mental Capacity Act 2005. Under this structure in the event of death or critical illness, the continuing shareholder becomes the buyer by exercising the Call Option or the estate can require the continuing share holder to buy the shares by exercising the Put Option.

The net result is that the deceased shareholder’s estate ends up with the money for the shares and the continuing shareholder continues to have control of the company by holding their share and the shares of the deceased shareholder.

Initially there should be a valuation of the shares at the date the cross option agreement is entered into and as time goes on the value of the shares may go up or down in which case the insurance policy gets adjusted.  If the price of the shares cannot be agreed, then the valuation is carried out by the accountants who will have in the cross option agreement a defined basis for the valuation.

To avoid the difficulties that can occur, it’s worth going through the complexities of a double option agreement with insurance policies held in trust for each other to cover the contingency of death or loss of capacity.

We have the knowledge and ability to create the cross option agreement and we can introduce independent financial advisers to find a suitable policy at the best available premium.

Lynne Brooke

The Brooke Consultancy

Posted in Blog | Tagged , , , , , , , , , | Comments Off on Protect your business and yourself

UK Immigration Rules: New routes – individuals

2022 is a big year for UK immigration! The Government has announced some major changes to the system for UK work visas already and it plans to announce more later this year. It will introduce the main changes from April to August. Businesses should take note and take appropriate action now.

Investor Visa

For many years, there was an Investor Visa category allowing people to move to the UK on the basis of an investment here. As recently as 2011, the Government announced its intention to “[roll] out the red carpet for … investors”. Unexpectedly, the Government removed this category on 17 February 2022, with immediate effect. It cited a need to stop “corrupt elites” and “dirty money” as its main reasons for this decision. In fact, it had made many changes to the investor visa scheme over a number of years in order to address issues around corruption and money laundering.

In any case, it is now necessary to look for alternatives to the Investor Visa category. The Government has indicated that it will make changes to the Innovator Visa in Autumn 2022, in order to provide a replacement for the Investor Visa. We will wait to see those changes, but for now there is very little opportunity for self-employed / independent business people to move to the UK. This is a major gap in the UK immigration system.

Global Business Mobility

The Government is introducing a Global Business Mobility category, which brings together and amends a number of existing visa routes. This comes into force on 11 April 2022.

  • The UK Expansion Worker route is for senior or specialist staff who are being assigned to the UK to help with a business’s expansion to the UK; and this replaces the long-standing and popular Sole Representative route.
    – The key change is that this route cannot lead to permanent residence in the UK.
    – Also, the UK employer must now be a licensed sponsor.
    – It is possible to bring family to the UK.
  • The Senior or Specialist Worker route is for senior or specialist staff assigned to a UK business linked to their employer overseas; and this replaces the existing Intra-Company Transfer route.
  • The Graduate Trainee route is for workers on certain graduate training courses, required to do a work placement in the UK; and this replaces the Intra-Company Graduate Trainee route.
  • The Service Supplier route is for people who need to undertake an assignment in the UK to provide services covered by one of the UK’s international trade commitments; and this replaces the Temporary Work – International Agreement route.
  • The Secondment Worker route is for workers seconded to the UK by their employer overseas. This is a new route for people working on a high value contract or investment.

High Potential Individual

This is a new route which allows recent graduates of certain leading global universities to work in the UK. This comes into force on 30 May 2022.

  • An important attraction is that there is no need for a licensed sponsor.
  • It is possible to bring family to the UK.
  • This route cannot lead to permanent residence in the UK.

immigration family

Scale-up

This is a new route which allows those with a job offer for highly skilled work from a recognised UK scale-up to qualify for a fast-track visa. This comes into force on 22 August 2022.

  • The UK employer must be a licensed sponsor at least for the first 6 months.
  • It is possible to bring family to the UK.
  • This route can lead to permanent residence in the UK. This is an important and now rare feature, in the context of UK work visas.

Conclusion

Due to the removal of many routes to permanent residence, people on many of these work visas will have to switch to other visa routes in the UK if they want to stay here long term, leading to increases in time and cost. Their employers will generally need to be licensed sponsors, which will increase the regulatory burden that they face. We will wait to see how businesses react when the Government introduces these changes.

by Usman Sheikh,

the founder of Ansar, & Collaboration Partner – The Brooke Consultancy

(photo sources: Unsplash – Brooke Cagle, Unsplash – Brytny)

Posted in Blog | Tagged , , , , , , , , , , | Comments Off on UK Immigration Rules: New routes – individuals

Pensions Freedoms for inter-generational Planning

The mere mention of the word Pension for many people creates an instant sense of boredom, complexity and jargon! A minefield of rules and regulations as well as being told by everyone from government to our parents that we are not setting enough aside for retirement, is usually “the nail in the coffin” to the conversation!

Indeed, the historical combination of very limited options on how you draw your pension, and that it ends on you, or your dependants death meant that as a financial planning product it had limited appeal. If you paid into a pension for many years and you died early into your retirement, your pension provider often got a windfall. Hardly appealing!

From April 2015 however, a quiet revolution has been occurring in the dull world of Pensions. The government realised it needed to make drawing pensions more attractive so introduced legislation that would allow hard earned pension funds to pass from one generation to another and would not limit beneficiaries to solely being a spouse or dependants. For individuals who have significant pension funds and are unlikely to spend all the funds in later, this has now opened up a number of planning opportunities.

Whilst there are lots of rules and regulations about passing your pension from one generation to the next the basic principles are as follows:

  • When the person dies before age 75 the benefits can be paid as a lump sum or as a drawdown pension to any beneficiary tax-free, irrespective of whether they derived from uncrystallised or crystallised monies. In other words, whether the person is drawing their pension or not before aged 75, if they die early they can pass it on to anyone.
  • When the person dies after age 75 the benefits can be drawn down or paid as a lump sum taxed at the beneficiary’s marginal rate. In other words, when the person dies after the age of 75 they can still pass the pension on to anyone but they will pay income tax on the proceeds.
  • On death after age 75 the benefits can be paid as a lump sum to a trust with a 45% tax charge. So even if the person has no immediate beneficiaries the fund is not lost.

From an estate planning perspective this starts to look very attractive as Pension funds do not generally form part of your estate for Inheritance Tax purposes and continue to enjoy tax free growth. Contributions to pensions also attract tax relief at your highest marginal rate up to £40k per annum and individuals can “mop up” the previous three years contributions if they have not fully used their allowances.

There are three things to carefully consider though, when looking beyond the headlines of the 2015 Pension Freedoms. Firstly the rules do not apply to all types of pension scheme and some providers have not updated their products to allow for these flexibilities. Employer sponsored schemes that pay out a guaranteed percentage of salary at retirement do not qualify.

Secondly, the government places a cap or “Life Time Allowance” on how much pension an individual can build up before additional taxation maybe incurred. The amount is currently £1,073,100 and this has been frozen until April 2026. The Life time Allowance does not stop an individual taking advantage of pension freedoms but careful planning is needed to minimise its impact from a tax perspective for funds in excess of the Lifetime Allowance. The current allowance figure has moved around considerably over the years, both up and down, so again care is needed.

Thirdly using the flexible pension arrangements are just one way of passing your assets efficiently to the next generation, but it’s likely and indeed should fit into a wider plan. That plan will consider risk appetite, timing and control of asset and income distribution to meet your objectives as well as minimise tax liabilities; so consider all options.

So in summary, pensions whilst remaining somewhat dull and complex, since April 2015 have found a new purpose in terms of wealth transfer. The new rules do not apply to all schemes, so it’s important to check, but those that do offer a whole range of planning options for individuals and families. Taking professional advice early in the process will also help you maximise the opportunity and avoid mistakes, which with pension Planning are often difficult to unravel!

Matt Grimes

The Penny Group

 

The information in this article was written for purely informational purposes, do not take any action without speaking to us in the first instance. We can refer you to our partner financial firm, The Penny Group.

Posted in Blog | Tagged , , , , , , , , , | Comments Off on Pensions Freedoms for inter-generational Planning