Tribunal decisions

The decision

Upper Tribunal
(Immigration and Asylum Chamber) Appeal Number: OA/05384/2015

THE IMMIGRATION ACTS

Heard at Bradford
Decision & Reasons Promulgated
On 18th April 2017
On 27th April 2017

Before

DEPUTY UPPER TRIBUNAL JUDGE D E TAYLOR

Between

Secretary of State for the Home Department
Appellant
and

yueyun zhang
(ANONYMITY DIRECTION NOT MADE)
Respondent

Representation:
For the Appellant: Mr D Mills, Home Office Presenting Officer
For the Respondent: Mr E Pipi instructed by Ashtons Solicitors

DECISION AND REASONS
1. This is the Secretary of State’s appeal against the decision of Judge O’Garro made following a hearing at Hatton Cross on 5th August 2016.
Background
2. The claimant is a citizen of China. She applied for entry clearance to come to the UK as a partner but was refused on 5th March 2015.
3. In his notice of decision the Entry Clearance Officer states:
“Your sponsor is not exempt from the financial requirements as defined in paragraph E-ECP.3.3. I am not able to take into account any potential employment you have available to you in the UK or any offers of financial support from third parties. In order to meet the financial requirements of the Rules your sponsor needs a gross income of at least £18,600 per annum. You state that your sponsor has been self-employed working for Evergreen since August 2013 and pays himself a salary of £18,600 per annum. Your sponsor is the director and only shareholder in the company.
I acknowledge you have provided your sponsor’s payslips and personal bank statements showing corresponding payments of £1,550 per month gross which equates to £18,600. However as your sponsor is the director and only shareholder of this company the salary paid to himself is not necessarily a true reflection of his actual income.
I note that you have not provided the HMRC document CT600 which is a specified document when qualifying under this category. I also note that in the last full financial year your sponsor only earned £10,850 which is significantly lower than the £18,600 required. I am not satisfied that your sponsor’s income is as claimed.”
On that basis he refused the application.
4. In his determination the judge said that it was clear that the HMRC document, CT600 was in fact before the Entry Clearance Officer. He also accepted that there was no discrepancy in the claimant’s figures. The sponsor could only submit records of his financial statement and tax records for April 2013 to April 2014. The business had not started until August 2013. His income therefore showed seven months’ earnings which equated to £18,600 over twelve months. He then wrote as follows:
“Indeed when the calculation of the sponsor’s actual earnings was done in court by the respondent’s representative, Mr Clarke, it was accepted that there is no discrepancy at all in the figures, based on the fact the sponsor was paid a salary from his company from September 2013 to March 2014 and that would cover the tax year 2013 to 2014. It was also accepted that if the sponsor’s salary was added on from the period April 2014 to August 2014 it would show an income of £18,600.”
The Grounds of Application
5. The Entry Clearance Officer sought permission to appeal on the grounds that the judge had erred in taking into account income earned outside the relevant period which was the financial year April 2013 to April 2014.
6. Permission to appeal was granted by Upper Tribunal Judge Martin on 16th December 2016.
Submissions
7. Mr Mills helpfully provided the copy of the relevant Immigration Rules. He accepted that the relevant Rule was not Rule 7, as the author of the grounds appeared to believe, but Rule 9.
8. Rule 7 relates to self-employment in the UK as a partner, a sole trader or in a franchise, and requires documents to be produced for the last full financial year i.e. in this case April 2013 to April 2014.
9. He accepted the point made by Mr Pipi that the correct Rule was Rule 9, because it is clear that this was the Rule considered by the Entry Clearance Officer and the appropriate one for the sponsor who was a director of his company.
10. However, he submitted that Rule 9 also required the production of documents for the last full financial year. At Rule 9(c) it states:
“Where the person is listed as a director of the company and receives a salary from the company, all of the following documents must also be provided:
(i) Payslips and P60 (if issued) covering the same period as the Company Tax Return CT600;
(ii) Personal bank statements covering the same 12-month period as the Company Tax Return CT600 showing that the salary as a director was paid into an account in the name of the person or in the name of the person and their partner jointly.”
11. He relied on Rule 13 which sets out how a gross annual income under Appendix FM is to be calculated. At 13(e) it states:
“Where the person is self-employed, their gross annual income will be the total of their gross income from their self-employment, from any salaried or non-salaried employment they have had or their partner has had (if their partner is in the UK with permission to work), from specified non-employment income received by them or their partner and from income from a UK or foreign State pension or a private pension received by them or their partner, in the last full financial year or as an average of the last two full financial years. The requirements of this Appendix for specified evidence relating to these forms of income shall apply as if references to the date of application were references to the end of the relevant financial year(s). The relevant financial year(s) cannot be combined with any financial year(s) to which paragraph 9 applies and vice versa.”
12. The judge was confined to considering the evidence from April 2013 to April 2014 and not, as he had done, considering the evidence from August 2013 to August 2014.
13. Mr Pipi submitted that the Secretary of State was wrong to rely on paragraph 7, which had no application here. The correct Rule was set out in paragraph 9 and he said that the sponsor had provided all of the relevant evidence set out in that paragraph including payslips, P60 and personal bank statements. During the period from August 2013 he was an employee and had supplied all of the relevant specified evidence.
Findings and Conclusions
14. I have great sympathy with the claimant who made her application for entry clearance over two years ago and who has clearly tried her best to find her way around the complexities of the Immigration Rules. She has not been helped by the fact that the initial refusal was flawed because the Entry Clearance Officer wrongly believed that a specified document had not been submitted, namely the CT600, when it had, and wrongly believed that the sponsor’s income was not as claimed when it is now conceded that it was. She has been further hindered by the fact that the challenge to the judge’s decision wrongly referred to Appendix FM-SE 2A(7).
15. It is quite clear that, so far as paragraph 9 is concerned, the sponsor provided everything that he was required to do, namely the payslips and P60 covering the same period as the company tax return which runs from 14th August 2013 to 13th August 2014 and personal bank statements covering the same period. It is not disputed that the sponsor’s income for that period meets the requirements of the Rules.
16. The problem for her lies in paragraph 13(j) which states:
“The provisions of paragraph 13 which apply to self-employment and to a person who is self-employed also apply to income from employment and/or shares in a limited company based in the UK of a type to which paragraph 9 applies and to a person in receipt of such income.”
17. The sponsor receives his income from the limited company. Paragraph 13(e) makes it clear that the income must relate to the last full financial year which in this case is April 2013 to April 2014.
18. Accordingly the judge erred in law in assessing the sponsor’s income as between August 2013 to August 2014 when in fact he was confined to assessing it between April 2013 and April 2014.
19. The proper course is a reapplication, and there is no reason why it would not succeed, since it does not appear to be disputed that the claimant now can establish that she meets the requirements of the Rules. Given the inordinate delays and previous errors in this case, it is to be hoped that this matter can be processed as quickly as possible.

Notice of Decision
20. The original judge erred in law. The decision is set aside. The claimant’s appeal is dismissed.

No anonymity direction is made.

Signed Date 26 April 2017

Deputy Upper Tribunal Judge Taylor