Switching from Post-Study Work to Entrepreneur visa: do I really need a contract?
Such a switch (application inside the UK) has many strings attached. There had to be some, since 'only' £50,000 in funds is required, as opposed to the main amount of £200,000.
So, if you are thinking of switching from a PSW to an Entrepreneur visa then you need to have a business already (or register one before you apply). Registration has to be in place together with things like appointed accountant, a business bank account, business insurance and if applicable, VAT certificate.
Also, the services your business provides to the clients must be at min NQF level 4 from the Tier 2 Code of Practice (available in the UKBA website). This is the services your business provides rather than what you personally do in your business.
As evidence of trading you have to indeed provide at least 1 contract. This is compulsory, even though in your work you may not need a contract with every client. These rules are basically written for 'contractors', ie people who are working as if they were employees but are self-employed 'on paper'.
So contract it is. Goes farther - contract must have specific details, such as full contacts of your client. If you miss 'one little thing', such as client's postcode, then your application may well be refused - however unreliable it sounds.
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