Hiring skilled workers from abroad can help UK businesses fill key vacancies and address labour shortages. However, sponsoring overseas staff comes with legal and financial responsibilities. One of these is the Immigration Skills Charge (ISC), a government fee payable by employers who bring skilled workers into the UK.
The ISC is not simply another visa cost. It was introduced to encourage businesses to invest in training the domestic workforce while still allowing access to international talent where needed. Understanding who pays it, how much it costs and when it applies is essential for any employer planning to sponsor a worker.
What is the Immigration Skills Charge?
The Immigration Skills Charge is a levy imposed on UK employers that sponsor foreign workers under certain visa routes. It applies to roles sponsored under the Skilled Worker visa and some Global Business Mobility visas, such as the Senior or Specialist Worker route.
The ISC was introduced in April 2017 as part of the government’s strategy to reduce reliance on migrant workers and support funding for skills development programmes in the UK. Each time a Certificate of Sponsorship (CoS) is assigned to a migrant worker, the employer must pay the charge.
Who pays the Immigration Skills Charge?
Responsibility for the Immigration Skills Charge lies entirely with the employer, not the employee. It cannot be passed on to the sponsored worker, either directly or indirectly. The fee must be paid whenever a Certificate of Sponsorship is issued, whether for a new hire or an extension that requires a fresh CoS.
This means that every time a business sponsors a worker under an eligible visa route, the ISC is due. Failure to pay will result in the Certificate of Sponsorship being invalid and the visa application being refused.
How much is the Immigration Skills Charge?
The cost of the Immigration Skills Charge depends on the size and type of employer:
- Large and medium-sized employers pay £1,000 for the first 12 months of sponsorship, plus £500 for every additional six-month period.
- Small businesses and charities pay a reduced rate of £364 for the first 12 months, plus £182 for every additional six months.
These fees are charged per sponsored worker, so businesses hiring multiple employees must budget for the cumulative costs. The charge is payable upfront when assigning the Certificate of Sponsorship.
Exemptions and reliefs
Not every sponsored worker is subject to the Immigration Skills Charge. Exemptions apply in situations such as:
- Workers switching from a Student visa to a Skilled Worker visa.
- Graduate Trainee roles under the Global Business Mobility route.
- Certain occupation codes, including researchers, some PhD-level jobs, clergy and elite sports professionals.
Employers should check the government’s latest guidance to confirm whether their sponsored roles fall under these exemptions.
Consequences of non-payment
If the Immigration Skills Charge is not paid when required, the Certificate of Sponsorship becomes invalid and the worker’s visa application will be refused. In addition, employers risk breaching their sponsor licence duties, which can lead to financial penalties, suspension or even loss of the licence.
This makes it vital for businesses to plan ahead and factor the ISC into their recruitment budgets. While the cost can be significant, compliance ensures smooth sponsorship and avoids disruption to the workforce.
What this means for employers
For UK businesses, the Immigration Skills Charge is a key part of the sponsorship process. Understanding who pays it, how much it costs and when exemptions apply is essential for compliance. Employers who plan ahead and budget effectively can make full use of the Skilled Worker and Global Business Mobility routes while avoiding costly mistakes.
Osbourne Pinner’s immigration solicitors support employers through every stage of the sponsorship process, from applying for a sponsor licence to managing ISC obligations. Our immigration specialists can guide you through the rules and help ensure your business remains compliant.
Start with a free 30-minute consultation at our offices or chat to us remotely. You can find us in Harrow, Canary Wharf, Piccadilly Circus and Manchester. To book a consultation, call 0203 983 5080, email [email protected] or fill out the form below.
