A Guide to Sponsoring Workers for UK Businesses

As an employer, you may explore the prospect of sponsoring skilled workers from overseas to address staffing needs within your organisation. However, it’s crucial to grasp the associated costs, aligning them with your budget and overarching business objectives. In this article, we delve into the various factors influencing the expenses tied to sponsoring skilled visas, providing a comprehensive understanding of the bottom line.

What is Sponsorship?

Sponsoring skilled workers involves a multifaceted process demanding both time and financial investment. Before delving into costs, a clear understanding of skilled visa sponsorship is essential.

Sponsorship enables employers to hire foreign workers for roles that local talent cannot fulfil, necessitating navigation through immigration systems and adherence to legal and regulatory requirements. The regulations around sponsorship can be confusing and there is a cost to employers, and weighing up the cost with the role is something that every employer will need to do. In short, is it worth paying the sponsorship fees for the hire?

If you need support with sponsorship, UK Visa Specialists have a team of experts who can help your business with sponsorship. We offer a range of services from guidance to dealing with all the sponsors your business makes.

Understanding The Costs Of Sponsoring Workers

From application fees to health insurance expenses, employers must consider various costs when sponsoring skilled workers. The specific visa type, sponsorship duration, and additional requirements impact overall expenses. Understanding these factors allows for more accurate cost estimation and strategic planning in skilled visa sponsorship.

Sponsorship Cost Breakdown:

When applying for a sponsor licence, the Home Office charges £536 for charities or small entities and £1,476 for large sponsors. Definitions from the Companies Act 2006 determine size, with sponsor licences valid for four years and requiring the same amount for renewal.

Below is a breakdown of the costs of some of the most common sponsorship fees than an employer may incur.

  1. Sponsor Licence Application:
    • £536 for charities or small entities.
    • £1,476 for large sponsors.
    • Valid for four years, and the same amount is required for renewal.
  2. Sponsoring a Skilled Worker:
    • Certificate of Sponsorship (CoS): £239 per certificate.
    • Immigration Skills Charge:
      • For small or charitable sponsors: £364 for the first year, £182 for each additional six months.
      • For medium to large sponsors: £1,000 for the first year, £500 for each additional six months.
  3. Visa Application Fee (Skilled Worker Visa):
    • Visa up to three years in a non-shortage occupation: £625.
    • Visa up to three years in a shortage occupation: £479.
    • Visa for more than three years in a non-shortage occupation: £1,235.
    • Visa for more than three years in a shortage occupation: £943.
  4. Immigration Health Surcharge:
    • £624 for each year of the visa.
  5. Premium Service for Employers:
    • £25,000 per year for a medium/large business.
    • £8,000 per year for a small business.
  6. Additional Costs:
    • Visa Application Fees: Vary based on the specific visa category and the number of workers being sponsored.
    • Legal and Migration Agent Fees: Fees for professional services if engaged.
    • Recruitment and Advertising Costs: Expenses related to advertising and recruiting for the sponsored position.
    • Relocation and Settlement Support: Costs associated with supporting the sponsored worker in relocating from overseas.
    • Compliance and Monitoring Costs: Administrative costs for ensuring ongoing compliance with visa sponsorship obligations.

Employers should carefully consider these costs and factor them into their budgeting and financial planning. Additionally, it’s important to stay informed about any changes in immigration policies and fees, as these may impact the overall cost of sponsoring skilled workers. By accurately estimating all associated expenses, employers can make well-informed decisions and mitigate any unexpected financial challenges.

Immigration Health Surcharge and Premium Service for Employers

The Immigration Health Surcharge is a tax that you have to pay on top of the application fees that we have outlines. The surcharge costs £624 per year and is added to visa application fees. Employers can opt for a premium service, costing £25,000 per year for medium/large businesses or £8,000 for small businesses, offering additional benefits.

Who Pays For Family Members?

All of the above information only applies for a single worker. Any family members that come to the UK alongside the sponsored worker will be liable for the visa application fee and Immigration Health Surcharge.

Before sponsorship goes ahead, we would always urge employers to check with the person whether they have family and to reach an agreement at the outset on who will bear what costs.

Sponsor can agree that the worker will pay their own application fee and Immigration Health Surcharge, however it is not possible to force the  Immigration Skill Charge on to individuals and you will also have to pay for their licence fee.

Don’t Forget To Plan For Recruitment Costs

In addition to aforementioned costs, employers need to consider visa application fees, legal and migration agent fees, recruitment and advertising costs, relocation and settlement support, and compliance and monitoring costs. Thorough consideration of these factors in budgeting and financial planning ensures informed decision-making and mitigates unexpected financial challenges.

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