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Discussion Starter · #1 ·
Hi wondered if anyone knew about the following as the rules don't specify.
I know someone who wants to make an FLR(M) application in a couple of months and is trying to meet the financial requirement under Category B - 12 month route - salaried employment. The test for this is two-fold:
1. Being in a job with a gross annual salary at date of application of at least £18,600 and
2. To have received in the 12 months prior to the date of application accumulated income of at least £18,600.

He can meet 1. OK as has worked 10 months in a good job. However he has left this and been offered another job whose contracted salary is just short of the £18,800. Hence he will not meet No.1 at time of application in 2 months. However he is certain to be given overtime which WILL take him above the amount. According to the rules overtime DOES count towards income so can be used in part 2. However the question is whether it counts as part of the gross annual salary for part 1. If he shows his most recent payslip which is less than £18,600 on normal time but MORE than £18,600 on overtime, will that be OK to meet part 1?

It's a tricky one and maybe cannot be answered unless it has been tested.

Anyone's thoughts or opinions would be appreciated.
 

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Not tricky. Fully covered in rules.
Under Cat B:
Where the person is in non-salaried employment – the level of gross annual employment income relied upon in the application can be no greater than the annual equivalent of the person’s average gross monthly income from non-salaried employment in the 6 months prior to the date of application, regardless of whether that employment was held throughout that period. The calculation will include all non-salaried employment undertaken during that 6 month period, and will be calculated over that 6 month period regardless of how much of that period was spent in employment.To calculate this annualised average for non-salaried employment in Category B the following calculation should be used:
(Total gross income from non-salaried employment undertaken during the 6 month period, divided by 6) multiplied by 12 = Income from non-salaried employment that can be counted towards the financial requirement.
So he needs to add up all his payslips during the past 6 months from his previous and current employment, and annualise it. If he has a long blank period between the two jobs, he may not meet the requirement, so make sure he starts his new job as soon as he quits his last.
 

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Discussion Starter · #3 ·
...further query on Appendix FM

Hi Joppa,
Thank you so much for your quick reply. I was going at what the rules said for "salaried" employment. So are you saying that because of his overtime, they would use the rules for "non-salaried"?

To be more specific he has worked about the last 10-11 months in a job under the Construction Industry Scheme (CIS) which the rules say can be counted as "salaried" employment. He is just starting another contracted salaried position which as I said is salaried below the threshold, but above with overtime. He will be applying on 1 June 2015.

He could also apply as a self-employed person and count salary from April 14 - April 15 (he has registered with HMRC and can provide the documentation) but the rules says he must be in "ongoing SELF-employment" whereas he has stopped the self-employed (CIS) job now and is starting contracted employment. So he is in ongoing employment but not ongoing SELF-employment which the rules require. Do you think this will matter?

Many thanks for your time.
 

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With overtime, he will be counted as non-salaried. Or strictly speaking, salaried with overtime. All it means is his salary and overtime over 6 months are added together and annualised, which comes to the same thing.
Can't apply under self-employment as he is no longer in one.
 

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Discussion Starter · #5 ·
...thank you

Hi Joppa,
Thank you so much. You have clarified things so expertly. I really appreciate your enlightenment. If possible could I just check one more thing... his partner (British Citizen) also has income from employment during the last 12 months. Could this also be factored into the equation i.e. added into the 6 months total figure which would be annualised?
 

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Discussion Starter · #7 ·
...jobs

No he finished the CIS job last month and is starting another salaried one any day now.
His partner had been employed for some of the last 12 months but then went on maternity leave and has now left the the job altogether.
 

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Discussion Starter · #8 ·
...to clarify

Basically by the time he makes his application his pay in the 6 months prior to this may not average to more than £1550 gross. So he will need to also use his partners income which comes to £3713 in the 6 months before application. Can this also be added into the 6 month total to get the annualised figure? If so then he is all clear.
 

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But as his partner is no longer in work, no, he cannot. I assume his partner is no longer on maternity leave?
 

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Discussion Starter · #10 ·
That's a good point. No she is no longer on maternity leave and has completely left that job. That is bad news for them. What if he was able to get work on a self employed basis? He is registered with HMRC so if he got something before the application he could maybe show evidence of ongoing self employment? Does that kind of evidence need to be anything specific? Maybe just invoices and payment entries into his bank account? Thanks
 

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He can re-start his self-employment. Evidence can include paying Class 2 national insurance contributions and a letter from his accountant confirming on-going self-employment..
 

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Discussion Starter · #12 ·
Yes I will tell him that. His new job is not really helping it would seem. Ok Joppa, thank you so much. You have really been helpful and your oversight has potentially averted a nasty outcome as this person is on a Youth Mobility visa and so could not extend further on this basis. Best wishes and all respect to this invaluable forum.
 
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