What does “cutting net migration” mean for UK private wealth immigration?
11 Dec 2023
2 min read
Unlike the standard Christmas packages that one would be excited about, the UK Home Secretary announced a package of measures in Parliament on 4 December which will “slash migration levels and curb abuse of the immigration system”. These measures will mean that around 300,000 people who migrated to the UK last year would not be able to come under the new requirements.
Summary
The five key measures announced are summarised as follows:
- Health and Care visa holders will no longer be allowed to bring dependants to the UK
- Skilled Worker visa salary threshold will increase to £38,700
- The Skilled Worker visa Shortage Occupation List will be replaced by a new Immigration Salary List and the 20% going rate salary discount will be removed
- Family visa income threshold will also increase from £18,600 to £38,700
- The Graduate visa route will be reviewed by the Migration Advisory Committee
Impact on private wealth immigration
In our experience, whilst most high net worth individuals rely on cash savings (instead of income) to meet the Appendix FM Financial Requirements for a UK Family visa, increasing the income threshold from £18,600 to £38,700 will also mean that the amount required for relying on cash savings alone is likely to increase from £62,500 to £112,750 based on the existing formula below:
- (£62,500 - £16,000) ÷ 2.5 (years of visa) = £18,600 (current income threshold)
- (£112,750 - £16,000) ÷ 2.5 (years of visa) = £38,700 (new income threshold)
The savings must be held in cash (or their cash value is clear) for at least six months prior to the Family visa application date. There are additional rules and source of funds requirements on what can be used as cash savings, so it is more onerous to meet the Appendix FM Financial Requirements than simply showing that the applicant and/or their UK sponsor hold more than £112,750.
By way of reminder, the annual Immigration Health Surcharge is set to go up from £624 to £1,035 from January 2024 for the majority of UK visa applications.
How can we help?
Burges Salmon's specialists have substantial experience in immigration, tax, trusts, and estate planning for international clients. If you wish to discuss any of the matters raised in this article, please do get in touch with Suzanna Harvey, Myra Leung or your usual contact within the team.
In addition to measures to reduce migration, the government will make sure that migrants coming to the UK make a fair financial contribution so that public services, including the NHS, are not taken advantage of by increasing the annual Immigration Health Surcharge from £624 to £1,035.