Sponsorship Licences

Making the Right Investment ─ Understanding the Costs of Sponsorship Licences

Although UK employers may find it frustrating to face staff shortages, it’s crucial for them to understand the cost of sponsorship licences in 2024.

By consulting with their immigration solicitors, they can make an informed financial decision about whether obtaining a sponsor license is the best option for hiring skilled migrant workers with skilled worker visas.

Without this license, employers risk facing skill shortages that can hinder their business’s growth or even result in reduced revenue.

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When applying for a sponsor licence, business immigration lawyers know that there are costs involved. However, UK employers should also consider the expenses of managing their sponsor licence and the visa-specific overheads that come with recruiting skilled worker visa holders or intra-company transfer visa workers.

It’s important to note that the cost of the 2024 sponsor licence is only part of the equation.

UK businesses, whether established or start-ups, should also evaluate the expenses associated with recruiting and training workers within the country.

Specialised training and college day releases can be costly, and there’s the question of whether the company can afford to wait for UK-based workers to gain the necessary skills or if investing in a sponsor licence is necessary to keep up with competitors and avoid stagnation.

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Check fees for sponsoring employees from Home Office

If the Home Office does not alter its sponsor licence fee application structure, you can reasonably anticipate certain sponsor licence fees. Once your company has obtained its initial sponsor licence, you will need to renew the licence every four years.

As a result, these expenses can be included as four years of overhead, but they must be paid upfront when you apply for or renew your sponsor licence.

Additionally, apart from the sponsor licence application fee, there are other fees that an employer may choose to transfer to the employee.

However, if your recruiting budget is based on potential employees paying some of the immigration fees, you may not attract the best candidates for the job. Your competitors may provide to pay these immigration costs as part of the job package and onboarding.

Look at sponsorship licences application fees from Home Office

When applying for a sponsorship licence, it is important to consider the cost of the initial application fee. This fee is payable every four years and remains the same whether it is your first application or renewal. The specific fee amount depends on the size of your business and whether your organization has charitable status. For small sponsors, the fee is £536, while large sponsors are required to pay £1,476.

When you pay for a sponsor licence, you will receive the standard processing and management service from the Home Office. If you want a higher quality service, you can pay extra fees. However, this will come at a cost of either £8,000 or £25,000 per year, depending on your company’s size. By paying this additional amount, you gain access to a dedicated sponsor licence account manager and other premium benefits of the sponsor scheme.

If you’re considering investing in the Home Office premium service, it’s recommended to consult with your immigration solicitors about utilizing their sponsor licence management service. This can be a more cost-effective way to efficiently apply for and manage your sponsor licence, especially if you check their average application turnaround times.

Alternatively, sponsor licence holders can opt to pay for the Home Office priority service for faster processing of sponsor licence or visa applications, but be aware that this option also comes with a fee.

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What is the immigration skills charge?

The immigration skills charge is a fee that must be paid by the sponsor licence holder to the Home Office. It is not possible for the visa applicant to pay this fee, and the sponsoring employer cannot subtract the amount from the employee’s salary.

If an employer is sponsoring a visa applicant to work in the UK for six months or more, they need to pay the immigration skills charge. This charge includes the certificate of sponsorship fee and the immigration skills charge fee. There are exemptions to this fee, but the job must meet certain criteria to qualify for the exemption.

When a company sponsors an immigrant visa applicant, the immigration skills charge fee is determined by the size of the company and the length of the visa. The job description and salary offered to the applicant do not affect the fee. If the visa application is denied, the Home Office will refund the fee paid by the company.

If you are a sponsor licence holder with a small company or charitable status, you will need to pay a fee of £364 for the first year of your sponsored employee’s visa. An additional fee of £182 will be charged for every six-month period.

However, if your company is classified as medium or large, you will need to pay £1,000 for the first year of sponsorship and £500 for each additional six-month period. It’s important to note that the full immigration skills charge must be paid at the time of the certificate of sponsorship assignment. This fee is calculated based on the length of the visa application and cannot be paid monthly or annually.

Certain job applicants who apply for skilled worker visas or intra-company transfer visas may be exempt from the immigration skills charge imposed by their sponsoring employer. This exemption applies to individuals who are applying for an intra-company transfer graduate trainee visa, those who are already on a student visa, or those who have been assigned a specific job standard occupation code in their certificate of sponsorship.

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Find more about the immigration health tax

If you are applying for a visa to immigrate to the UK, you may have to pay a fee called the immigration health surcharge unless you are exempt. However, some UK employers offer to pay this fee on behalf of work visa applicants as a job incentive, as other employers may also be doing the same.

Even if a company offers private healthcare and access to a private GP, they are still required to pay the immigration health surcharge for their employees. The surcharge costs £624 per year for most job applicants and £470 per year for anyone under the age of eighteen who is brought to the UK on a dependant visa.

However, health and care worker visa applicants and their dependents are exempt from paying the surcharge. It is not possible for an employer to avoid the surcharge by providing private health insurance or in-house medical cover.

Look at work visa application fees

When applying for a work visa, the visa applicant is typically responsible for paying the application fees. However, some employers may choose to cover these fees as part of their recruitment efforts. The cost of the visa application fee varies depending on the type of work visa and its duration.

For instance, a skilled worker visa that’s valid for three years or less currently costs £610. If the visa is valid for over three years, the cost increases to £1,220. But, if the job is on the shortage occupation list, the fee is reduced to £464 or £928, depending on the visa’s length.

It’s important to note that visa application fees can add up quickly if the applicant is bringing dependents on dependant visas to the UK.