The Home Office has been “too ready to find dishonesty” in the immigration applications of skilled migrants living in Britain, the court of appeal has ruled.

Leading judges have allowed test case appeals brought over the department’s policy of refusing applications for leave to remain in the UK on the basis of “discrepancies” in declared earnings.

The policy has seen hundreds of highly skilled migrants stripped of their UK status under a section of immigration law designed to remove people who pose a threat to national security.

The Home Office’s stance in these cases was “legally flawed” and needed a major overhaul to make refusals legal, the court said.

The Independent recently highlighted the case of one man whose family had been forced to move into one bedroom after the Home Office refused his application for indefinite leave to remain due to minor amendments to his tax records.

Family of five all living in same room after Home Office revokes UK status over tax error

Ikram Ullah, 42, was stripped of his right to work, leaving the family with no income. They had to sell the children’s toys and eventually scale down to renting just a single room just to be able to eat.

The appellants bringing the court case said the discrepancies in their tax records were the result of “innocent errors and that the Home Office's decision to the contrary was unlawful”.

Allowing four appeals, the judges declared that in three of the cases the principal reason was that the Home Office did not give a “fair opportunity to answer the charge of dishonesty”.

In the fourth, the principal reason was that decision letters did “not make a clear finding of dishonesty”.

Three of the cases were sent back to immigration tribunals for “further consideration” and the judges quashed the Home Office's decision in the fourth case, explaining that “a different tribunal has in the meantime” found that the applicant “did not act dishonestly”.

Lord Justice Underhill ​said a “large number of migrants have claimed that in their cases errors which were the result only of carelessness or ignorance have wrongly been treated as dishonest", and that the Home Office had been "too ready to find dishonesty without an adequate evidential basis or a fair procedure”.

Support free-thinking journalism and attend Independent events

The court declared: “Before making such a decision the Home Office must notify applicants of its concern and give them a fair opportunity to offer an explanation.”

A Home Office spokesperson said it would "consider the judgement and [its] response carefully".