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EEA / European Union Nationals - Minimum Earnings required to qualify for Permanent Residence after living and working in the UK for at least 5 consecutive years.

July 29, 2016

 

We often get enquiries from EU/EEA Nationals asking us as to ‘What is the minimum income an EEA National should earn in the UK so that he/she and his/her family members can qualify for Permanent Residence (PR) in the UK after living and working for 5 years in the UK?’

The objective of this article is to explain the minimum income requirement that an EEA/EU national would be required to earn and show evidence of their earnings and tax payments to the Home Office/UKVI to successfully obtain Permanent Residence.

There is no minimum income stipulated in any of the Home Office documents, however, out of experience, we have been able to get an idea as to what level of income the Home Office/UKVI would be considering as a minimum income standard to assess whether an EEA National is considered to be exercising treaty rights as a Worker/Self-employed in every year of their stay in the UK and hence would subsequently qualify for Permanent Residence.

We note that there is no minimum income stipulation anywhere in the UK/EEA Legislations that an EEA National is required to earn in order to qualify for Permanent Residence (PR) in the UK, however, it has been observed out of our past experience that:

I. If an EEA National is in Salaried Employment (PAYE), then the Home Office would usually consider the individual to be successfully exercising treaty rights in the UK if his gross income (income before taxes) is at least equal to the Primary Threshold (PT) for Class 1 National Insurance Contributions (NICs). 
Below table gives the Primary Threshold for the Tax Years 2008-09 to 2016-17.

Primary Threshold for Class 1 NICs for the Tax Years 2008-09 to 2016-17:
Tax Year Primary Threshold (per week)
2008-09 GBP 105
2009-10 GBP 110
2010-11 GBP 110
2011-12 GBP 139
2012-13 GBP 146
2013-14 GBP 149
2014-15 GBP 153
2015-16 GBP 155
2016-17 GBP 155
Source: HMRC

Hence, for instance, if an EEA national has earned at least GBP 149 per week in the Tax Year 2013-14 and paid NI and taxes on this income, then it is highly likely that he/she will be considered as successfully exercising treaty rights in the Tax Year 2013-14 and would be considered as a ‘Qualified Person’ in that year. 

Similarly, the EEA National needs to show that he/she has earned at least the above Primary Threshold amounts per week for any continuous period of at least 5 years throughout their stay in the UK.

II. If an EEA National is in Self-Employment and is registered with the HMRC as Self-employed, then the Home Office would usually consider the individual to be successfully exercising treaty rights in the UK if his Gross Income (income before taxes) is at least equal to the Small Earnings Exception/Small Profits Threshold for Class 2 National Insurance Contributions (NICs). 

[Please note that many client’s confuse Gross Income with Gross Revenue. Lets take an example to explain this, if an individual earns GBP 2000 (‘Gross Revenue’) by selling his/her goods/services and spends GBP 800 (‘Business Expenses’) in various expenses (business travelling expenses, rent for business premises, buying raw material/goods, etc.), then effectively his/her Gross Income would be GBP 1200 (Gross Revenue minus Business Expenses) and he/she will be calculating and paying the Tax on his/her Gross Income, i.e. GBP 1200].

Below table gives the Small Earnings Exception/Small Profits Threshold for the Tax Years 2008-09 to 2016-17.

Small Earnings Exception/Small Profits Threshold for Class 2 NICs for the Tax Years 2008-09 to 2016-17:
Tax Year SEE/ SPT(per year)
2008-09 GBP 4,825
2009-10 GBP 5,075
2010-11 GBP 5,075
2011-12 GBP 5,315
2012-13 GBP 5,595
2013-14 GBP 5,725
2014-15 GBP 5,885
2015-16 GBP 5,965
2016-17 GBP 5,965
Source: HMRC

Hence, for instance, if an EEA national has earned at least a Gross Income of GBP 5,885 in the Tax Year 2014-15 and paid NI and taxes on this income, then it is highly likely that he/she will be considered as successfully exercising treaty rights in the Tax Year 2014-15 and would be considered as a ‘Qualified Person’ in that year. 

Similarly, the EEA National needs to show that he/she has earned at least the above Small Earnings Exception/ Small Profits Threshold amounts per year for any continuous period of at least 5 years throughout their stay in the UK.

Exceptions:
The only exceptions to the above minimum income requirements for a Salaried/Self-employed EEA national would be:
1. If the EEA National was temporarily unable to work due to:
a. illness or accident, or
b. involuntarily unemployed and looking for work (i.e. between jobs) and he/she is registered as a Job-seeker with the Jobcentre Plus in England, Scotland and Wales or the Jobs and Benefits Office/Social Security Office in Northern Ireland, irrespective of whether he/she is receiving the Job Seekers Allowance or not), or
c. Unemployed and doing vocational training.

2. If the EEA National was formerly a Qualified Person and has ceased being a Qualified Person because:
a. He/she has Retired, or 
b. He/she is permanently incapacitated, or 
c. He/she is a Qualified Person in another EEA State but still retains his/her residence in the UK.

 

Disclaimer: 
The above article is merely the opinion of the author for informational purposes and shall not be relied upon as an advice. 
Every EEA National’s circumstances are different, hence, it is advisable that you consult a Qualified Immigration Lawyer before filing any EEA Applications.
Further, the information in this article is current and relevant as on the date of publishing, the UK Immigration rules are subject to change on a regular basis. Hence, it is advisable that you consult a Qualified Immigration Lawyer before filing any EEA Applications.

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