A Home Office contractor has put forward plans for an investor visa to be re-introduced as advisers claimed a targeted entry route for wealthy foreign nationals would be “dramatically beneficial” for the UK economy.
Envestors, an investment service that assesses entrepreneurs applying to enter the UK via the innovator founder visa, has argued that a new visa for foreign investors would allow research-led technology companies to grow.
Its annual report assessing the impacts of the innovator founder visa includes a call for business angels, who are high-net-worth individuals that invest millions of pounds into high-growth companies, to be offered a special visa that would allow small and medium-sized private companies to receive cash in return for equity.
Envestors said wealthy individuals entering the UK under the new “innovator business angel visa” should have corporate or business experience and meet strict rules on anti-money laundering and due diligence checks.
Investors would also provide mentorship to business owners under plans developed by the government contractor, focusing on supporting business immigration policy.
In return, foreign nationals investing at least £2m in three UK companies would be able to secure indefinite leave to remain (ILR), which allows people to gain settled status in the UK, after three years if 15 full-time workers are employed and £1m in annual revenue is generated.
Such a move would offer an olive branch to foreign nationals concerned about Labour’s decision to double the wait on gaining ILR from five to ten years.
Envestors pointed to analysis by the state-backed British Business Bank showing that angel investors were the largest source of investment in start-ups and early-stage businesses as evidence for the impact the visa could have on the UK economy.
Investor visa plans take shape
The previous Conservative government disbanded the previous form of the investor visa in the wake of Russia’s full-scale invasion of Ukraine in 2022 amid fears that oligarchs and other wealthy individuals had abused it.
Government officials are considering options to relaunch the investor visa as a key growth policy to boost the UK economy, according to Bloomberg.
Economists and City leaders have rung alarm bells over the number of wealthy individuals leaving Britain after Rachel Reeves ended the non-dom tax scheme for foreign nationals, who now have to pay inheritance tax on assets held overseas.
Former Chancellor Jeremy Hunt initiated the end of some tax breaks for non-doms in his last Budget. Shadow business secretary Andrew Griffith has since said it was a “mistake” to do so.
Wealthy individuals, including Aston Villa co-owner Nassef Sawiris and Goldman Sachs vice president Richard Gnodde, are among the top individuals to have left due to changes.
Official data on the exact number of wealthy investors leaving the UK due to changes is unavailable. A report in the Financial Times said HMRC data suggested the number of non doms leaving the UK had not been as high as some had estimated.
The Treasury has made attracting more investment central to wider economic policies as it created the Office for Investment, which will run a “concierge service” to help foreign investors and companies with understanding visas and managing red tape.
Government officials are also stepping up plans for this year’s Autumn Budget, with Reeves expected to raise at least £20bn in taxes in order to rebuild her fiscal buffer and stick to her fiscal rules.
Keir Starmer marked the return of parliament with a Budget-focused reshuffle of his team in No. 10 as Darren Jones was moved from the Treasury to become the chief secretary to the prime minister.
Former Bank of England deputy governor Minouche Shafik has also been brought in as his chief economics adviser while a senior Treasury civil servant, Dan York-Smith, will now serve as Starmer’s principal private secretary.