I want to bring my spouse to the UK but I am confused about the 18600 financial requirement. How do we deal with tax allowances and sef employment here?
I am currently trying to work out if I can bring my Spouse to the UK but I am very confused as to how the entire process works. I read that the figure of £18,600 is required as a compulsory financial requirement, yet I have been told that the personal tax allowance is deducted from the gross income for the tax year. In effect, if I earned £25,000 on the basis of me been self-employed, it is counted as only £15,000 taxable income. I was astonished. Do you know if this is correct? I bring in £25k - AFTER his business expenses - such as travel, phone etc. £17k profit to HMRC UKBA will consider my income to be £17k or 25K. Thanks can you also quote me your price for handling the matter.
You can be self-employed as a sole trader or you can be self-employed as a Director of a limited company in the UK. If you are self-employed as either of them, first of all, you must have been self-employed for 12 months prior to the date of application. Furthermore, within those 12 months, you need to show that you have earned £18,600. The documentary evidence you will be provided however differs with respect to whether you are self-employed as a sole trader or as a director.
Importantly, the financial requirement only applies strictly during the financial year; months after that are not included. A practical example is this - The financial year in the UK is between the 1st of April of one year to the 30th of April the next year. If for any reason you are applying in July, the period that you have to show that you are earning £18,600 is from the 1st of April of the previous year to the 30th of April in the current year. The next two months, May and June will not apply - even though you still have to show that you are still compliant and self-employed.
In addition, you may rely on a moving average of the past two financial years. This may be necessary if you just about fall short in one financial year.
For self-employment on the basis of been a sole trader, the £18,600 minimum financial requirement is calculated on the basis of your gross income. That is, your income after deducting all expenses (but not tax) should be at or above £18,600. If however, you are a director, who is also a shareholder of the company, the £18,600 is taken on the basis of both your divided and your salary (in the financial year(s) you are relying on.
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