The Immigration Skills Charge (ISC) continues to be one of the most important — and sometimes misunderstood — aspects of sponsoring overseas workers in the UK. If your business is hiring foreign nationals under the Skilled Worker or Senior or Specialist Worker visa routes, you are almost certainly liable to pay this charge.
Introduced to encourage employers to train domestic talent rather than rely on overseas hires, the immigration skills charge is levied by the UK Home Office on employers every time they assign a Certificate of Sponsorship (CoS) to a qualifying migrant worker. In 2025, this charge remains a significant budget consideration for businesses of all sizes across sectors including healthcare, tech, engineering, and education.
How Much Is the Immigration Skills Charge in 2025?
As of 2025, the immigration skills charge is set at the following rates:
- £1,000 per year for medium and large sponsors
- £364 per year for small or charitable sponsors
This means if you’re sponsoring a worker on a five-year Skilled Worker visa, the total charge could be as high as £5,000 per sponsored employee — paid upfront.
Understanding how the immigration skills charge works — and how to manage or potentially avoid it where exemptions apply — is essential for budget forecasting, legal compliance, and operational planning.
Who Needs to Pay the Immigration Skills Charge in 2025?
If you’re sponsoring a foreign worker in the UK, understanding whether your business must pay the immigration skills charge is essential. This fee applies in most cases and is enforced strictly by the Home Office. Getting it wrong — by underpaying, missing exemptions, or not paying at all — can result in delays, fines, or even the suspension of your sponsor licence.
When Does the Immigration Skills Charge Apply?
The immigration skills charge must be paid every time a Certificate of Sponsorship (CoS) is assigned to a worker applying under the:
- Skilled Worker visa
- Senior or Specialist Worker visa (previously Intra-Company Transfer route)
The charge is applied per sponsored worker, and the amount is calculated based on the duration of sponsorship requested — typically in full years or part-years over six months.
Who Is Required to Pay?
The employer (not the employee) is legally responsible for paying the immigration skills charge. You must pay the fee when assigning the CoS as part of the visa application process. It cannot be passed on to the employee, either directly or through payroll deductions.
The fee applies regardless of the worker’s salary level, nationality (except exemptions), or skill level — provided they fall under one of the qualifying visa routes.
What About Existing Employees?
The immigration skills charge also applies to visa extensions. If you extend a Skilled Worker’s permission to stay, and this requires a new Certificate of Sponsorship, you will be charged again based on the length of the new sponsorship term.
There are no “grandfathering” protections for workers already in the UK before the charge was introduced — the rules apply to every new CoS assigned, even for long-standing employees.
What Types of Organisations Must Pay?
Both public and private sector employers are subject to the immigration skills charge. Whether you run a hospital trust, a tech firm, or a restaurant chain, if you are sponsoring a Skilled Worker, you must factor in this cost.
The main exception comes down to whether your organisation qualifies as a small or charitable sponsor, which affects the rate, not the obligation.
How Much Is the Immigration Skills Charge? Fees Breakdown 2025
A key part of understanding the immigration skills charge is knowing exactly how much it costs — and how the amount varies depending on your organisation type and the length of employment. As of 2025, the fee remains substantial and must be paid upfront when assigning a Certificate of Sponsorship.
Immigration Skills Charge Rates in 2025
The current fee structure for the immigration skills charge is:
| Organisation Type | Annual Charge per Sponsored Worker | Example: 3-Year Visa Total |
| Large or Medium Sponsor | £1,000 per year | £3,000 |
| Small or Charitable Sponsor | £364 per year | £1,092 |
This means that sponsoring a worker on a five-year Skilled Worker visa would cost:
- £5,000 for large or medium sponsors
- £1,820 for small or charitable sponsors
The fee is calculated in full years and part years over six months. For example:
- A 2-year, 4-month CoS would trigger a 2-year charge.
- A 2-year, 7-month CoS would round up to 3 years.
What Counts as a Small or Charitable Sponsor?
You qualify for the reduced immigration skills charge if your organisation meets two of the following criteria:
- Annual turnover of £10.2 million or less
- Total assets worth £5.1 million or less
- 50 employees or fewer
Charities automatically qualify for the reduced rate, including:
- Registered UK charities
- Exempt charities under UK law
- Charitable incorporated organisations (CIOs)
You must declare your status correctly in your sponsor licence application and maintain proof in case of an audit or compliance check.
Other Visa Costs to Consider
While the immigration skills charge is a major expense, it is not the only fee sponsors face. Additional costs include:
- Certificate of Sponsorship (CoS) fee – £239 per worker
- Skilled Worker visa application fee – £719 to £1,500 (paid by worker or employer)
- Immigration Health Surcharge (IHS) – £1,035 per year (usually paid by worker)
It’s critical to budget for the full cost of sponsorship, particularly for long-term hires.
Immigration Skills Charge Exemptions in 2025
While the immigration skills charge applies broadly, there are specific exemptions in place for certain categories of workers. Knowing when an exemption applies can save your organisation thousands of pounds per sponsored employee.
Who Is Exempt from the Immigration Skills Charge?
As of 2025, you do not need to pay the immigration skills charge if the sponsored worker:
- Is switching from a Student visa to work visa (formerly Tier 4)
- If the applicant is applying from within the UK and previously held a Student visa, the charge does not apply — provided they studied a relevant course at a UK institution.
- This exemption applies to initial applications only. If the worker later extends their stay, the charge may apply again.
- Will be working in a PhD-level occupation
- Occupations classified as RQF level 8 (PhD level) are exempt. These roles typically fall within higher education, scientific research, and advanced technology sectors.
- You must ensure the job code used for the Certificate of Sponsorship is on the official PhD-level list published by the Home Office.
- Is employed under a recognised international agreement
- Workers coming to the UK under international treaties, such as the General Agreement on Trade in Services (GATS), may be exempt.
- Is a graduate trainee on the Global Business Mobility – Graduate Trainee route
- This is a temporary route for multinational firms transferring graduate employees as part of a structured training programme. The immigration skills charge does not apply to this visa.
- Is sponsored for less than 6 months
- The charge applies only to sponsorship terms that are 6 months or longer. Assigning a CoS for a shorter period avoids the fee, although such short durations are uncommon for Skilled Worker visas.
No Exemption for Shortage Occupation List Roles
It’s important to clarify that roles on the Shortage Occupation List are not exempt from the immigration skills charge. While these roles attract lower visa application fees, the ISC must still be paid in full.
Employer Responsibilities
You must declare the exemption at the time of assigning the Certificate of Sponsorship and retain supporting evidence. HMRC and the Home Office can request documentation during a compliance audit, and incorrect claims can lead to:
- Rejection of the visa application
- Financial penalties
- Suspension or revocation of your sponsor licence
If you’re unsure whether an exemption applies, it’s best to seek legal guidance before assigning the CoS.
When and How to Pay the Immigration Skills Charge?
Timing is everything when it comes to the immigration skills charge. Payment must be made at a specific point in the sponsorship process, and failing to get it right can delay the worker’s visa application — or result in rejection.
When Do You Pay the Immigration Skills Charge?
The immigration skills charge is paid at the same time as assigning a Certificate of Sponsorship (CoS). This happens during the process of applying to sponsor a foreign national for a Skilled Worker or Senior or Specialist Worker visa.
You’ll be prompted to pay the immigration skills charge:
- Online, through the Sponsorship Management System (SMS)
- Immediately after assigning the CoS to a worker
The charge must be paid in full upfront for the entire duration of sponsorship. There is no option to pay in instalments or delay payment. If payment is not completed, the CoS is invalid, and the worker’s visa application will fail.
How to Make Payment
The immigration skills charge is paid through the Home Office’s online system. You’ll need:
- A valid debit or credit card
- Your company’s payment authorisation (if needed internally)
- Accurate information about the worker and length of sponsorship
Once submitted, you’ll receive a payment confirmation — keep this for your records.
Payment is non-refundable once the visa has been granted, except in certain limited cases.
Can You Get a Refund?
You may be eligible for a refund of the immigration skills charge if:
- The visa application is refused or withdrawn
- The sponsored worker doesn’t start the job
- The worker leaves their role earlier than expected
- The CoS is unused or cancelled before the worker arrives
In these cases, the Home Office may refund the unused portion of the charge. Refunds are processed automatically, but it can take up to 90 days. You should monitor your Sponsorship Management System account and retain all documentation.
What Happens If You Don’t Pay?
Failing to pay the immigration skills charge correctly and on time will result in:
- The Certificate of Sponsorship becoming invalid
- The worker’s visa application being refused
- Compliance action against your business by the Home Office
- Potential loss of your sponsor licence
Employers must treat this payment as a non-negotiable part of the hiring process for foreign nationals.
How the Immigration Skills Charge Affects Your Hiring Strategy
For employers, especially SMEs and growing enterprises, the immigration skills charge is more than just another fee — it’s a strategic factor that can significantly influence hiring decisions. In 2025, with economic pressure and increased scrutiny of immigration compliance, it’s more important than ever to understand how this cost shapes your workforce planning.
Budgeting for Sponsorship Costs
The immigration skills charge adds a substantial upfront cost to hiring foreign talent. When combined with the Certificate of Sponsorship fee, visa application charges, and the Immigration Health Surcharge, the total sponsorship cost per employee can easily exceed £7,000–£10,000 for a five-year Skilled Worker.
This impacts:
- Recruitment budgets – especially when multiple roles are being filled simultaneously
- Cost-benefit analysis of hiring a UK-based candidate versus an international hire
- Departmental headcount planning – especially in sectors like healthcare, hospitality, and engineering
In short, the immigration skills charge can be a barrier to scaling, particularly for startups or charities with limited funding.
Impact on Salary Negotiations and Retention
Because the immigration skills charge is non-transferable and non-recoverable (except in limited cases), employers have to factor it into their overall cost of hire. This affects:
- Starting salaries
- Probation periods
- Long-term retention strategies
Investing thousands into hiring an international worker means you want them to stay for the full visa term, if not longer. This raises the importance of:
- Offering competitive salaries
- Supporting long-term settlement (e.g., Indefinite Leave to Remain)
- Building a positive working environment that encourages retention
Deciding Between Visa Routes
For some roles, the immigration skills charge may influence the visa route you choose. For example:
- A Graduate visa does not require employer sponsorship — and therefore avoids the charge.
- A Graduate Trainee under the Global Business Mobility route is exempt from the charge.
- A worker switching from a Student visa may also offer short-term relief from the ISC.
Understanding these alternatives can cut costs significantly, especially if you’re hiring early-career professionals or filling temporary roles.
Outsourcing and Offshoring Considerations
Some employers may consider offshoring roles or contracting foreign workers rather than sponsoring them directly — especially for remote-capable jobs. While this can avoid the immigration skills charge, it raises other challenges:
- Legal and tax implications
- Data protection and operational oversight
- Cultural and communication barriers
Nonetheless, the immigration skills charge remains a commercial consideration in decisions about where to locate talent.
Immigration Skills Charge Compliance: Avoiding Penalties in 2025
Paying the immigration skills charge isn’t just a formality — it’s part of a tightly regulated sponsorship system. Failing to comply with the rules around this charge can lead to serious consequences, including Home Office audits, financial penalties, and even revocation of your sponsor licence.
Here’s how to stay compliant in 2025.
Common Compliance Mistakes
Employers often make errors when it comes to the immigration skills charge. The most frequent include:
- Forgetting to pay the charge when assigning a Certificate of Sponsorship
- Paying the wrong amount (e.g., assuming you’re a small sponsor when you’re not)
- Incorrectly claiming an exemption
- Failing to track when charges apply for visa extensions or job changes
These are not minor oversights — they can delay a visa application or trigger an investigation into your compliance practices.
Best Practices for Staying Compliant
To remain fully compliant with Home Office rules in 2025, employers should:
- Check sponsor classification annually
Confirm whether your business still qualifies as a small or charitable sponsor, especially if your revenue or headcount has changed.
- Assign CoS accurately
Ensure the job code, salary level, and duration reflect the actual terms of employment. Misclassifications may affect how the immigration skills charge is calculated.
- Use Mapped Roles and Check Exemptions
Before claiming an exemption from the immigration skills charge (e.g., for a PhD-level role or student switch), cross-reference the official occupation codes published by the Home Office.
- Keep Payment Records
Save the payment receipt or confirmation for every charge paid. You’ll need it in case of a compliance visit or audit.
- Implement Internal Review Processes
Create a checklist for each sponsored hire. This should include immigration skills charge payment, visa timelines, and key responsibilities under the Sponsor Duties and Compliance Framework.
- Stay Informed About Rule Changes
Immigration policy can shift quickly. Salam Immigration recommends subscribing to Home Office updates and consulting with a legal advisor when in doubt.
What Happens If You Get It Wrong?
If the Home Office finds that you’ve:
- Failed to pay the immigration skills charge
- Claimed an exemption you weren’t entitled to
- Misrepresented your sponsor status
In serious cases, this can halt your ability to hire internationally and damage your business reputation.
Frequently Asked Questions
1. What is the immigration skills charge in the UK?
The immigration skills charge is a fee paid by UK employers who sponsor workers under the Skilled Worker or Senior or Specialist Worker visa routes and are moving to the UK. It’s designed to encourage businesses to invest in local talent. As of 2025, the fee is £1,000 per year for large sponsors and £364 per year for small or charitable sponsors.
2. Who pays the immigration skills charge?
The UK employer, not the employee, is legally required to pay the immigration skills charge when assigning a Certificate of Sponsorship. The charge must be paid upfront for the full sponsorship period and cannot be reclaimed from the worker.
3. When is the immigration skills charge due?
The immigration skills charge is due at the time of assigning a Certificate of Sponsorship. This occurs before the visa application is submitted. If you fail to pay the charge correctly, the CoS will be invalid and the visa will be refused.
4. How much is the immigration skills charge for a 5-year visa?
For a five-year visa, the immigration skills charge is:
- £5,000 for large or medium sponsors
- £1,820 for small or charitable sponsors
These amounts must be paid in full and in advance as part of the visa sponsorship process.
5. Are any jobs exempt from the immigration skills charge?
Yes, there are several immigration skills charge exemptions in 2025. These include:
- PhD-level roles (as classified by the Home Office)
- Graduate Trainees under the Global Business Mobility route
- Workers switching from Student visas within the UK
- Sponsorships lasting less than six months
Always check eligibility before claiming an exemption to avoid compliance issues.
6. Does the immigration skills charge apply to visa extensions?
Yes. If a worker’s visa is extended and a new Certificate of Sponsorship is issued, the immigration skills charge must be paid again for the extension period.
7. Can I get a refund for the immigration skills charge?
Refunds are available in some cases, such as:
- The visa application is refused
- The worker does not start the job
- The worker leaves the role earlier than expected
- The CoS is unused or cancelled
Refunds are processed automatically by the Home Office but may take up to 90 days.
8. Do charities pay the immigration skills charge?
Charities are classified as charitable sponsors and benefit from the reduced rate of £364 per year. However, they are not exempt unless the worker meets other exemption criteria.
9. Is the immigration skills charge part of the visa application fee?
No. The immigration skills charge is a separate employer fee and is not included in the worker’s visa application fee or the Immigration Health Surcharge. Employers must pay it through the Sponsorship Management System.
Need Expert Help Navigating the Immigration Skills Charge?
At Salam Immigration, we specialise in helping UK employers manage every aspect of the Skilled Worker visa sponsorship process — including calculating, managing, and claiming exemptions from the immigration skills charge.
Whether you’re new to sponsorship or managing a complex, multi-site workforce, our team provides:
- Practical legal guidance
- End-to-end sponsor licence support
- Up-to-date compliance advice tailored to your sector
Avoid mistakes, Save time, Stay compliant. Contact us and book a consultation today
