Tier 2 Immigration Skills Charge
If you are a Tier 2 Sponsor Licence holder and are looking to hire an overseas national, you may have heard of the Immigration Skills Charge which started on 6 April 2017. The charge is applied to the vast majority of Tier 2 visas and is payable if you intend to offer employment to a migrant worker for more than six months. This charge is in place to help fund the skills of domestic workers, so it can address skills gaps using the public education system. While many sponsors may question why the charge exists, it’s an integral part of the Tier 2 visa programme and must be paid upon the allocation of a Certificate of Sponsorship. While in some circumstances, sponsors are exempt from paying the charge (we’ll cover this in a later section), the vast majority will need to pay.
If you need to know more about the Immigration Skills Charge, you are in the right place. Below we have answered many of the more common questions that Tier 2 Sponsor Licence holders have about the charge. While we have tried to answer as many questions as possible, we may have not covered all eventualities. If you have a query, then please get in touch and we’ll be happy to help.
How Much Is the Tier 2 Immigration Skills Charge?
The Immigration Skills Charge is payable when you allocate a Certificate of Sponsorship to your new employee. To work out how much you will need to pay, we have laid out below what the current fees are. UKVI base these fees on how long you intend to sponsor your employee and also on the size/revenue of the business:
Small or charitable sponsors
Medium or large sponsors
First 12 months
Each additional 6 months
If you are unsure which category you fall into, you will need to contact the UKVI.
One of the major drawbacks of the Immigration Skills Charge is the rule that you must pay the full charge upfront. For instance, if you are looking to sponsor your new employee for the maximum five-year period, you will need to pay five times the annual rate in one go. For many businesses, this is prohibitive and means that they may choose to not sponsor their employee for as long as they might want to, or need to. Also, if you are looking to take someone on for less than a year but over six months, you will need to pay for a complete 12 months.
Who Is Exempt from The Immigration Skills Charge?
There are some instances where you will not need to pay the Immigration Skills Charge. In these circumstances, you will need to enter accurate information into the SMS to ensure that it does not charge you.
In the below circumstances, you will not need to pay the Immigration Skills Charge:
- Where the applicant has a Tier 4 Student Visa and is switching to a Tier 2 General Visa
- Where the applicant has a Tier 2 Intra-company Transfer Graduate Trainee Visa
- Where the applicant will do a job with a PhD-level standard occupational classification (SOC) code
As well as the above examples, you also do not pay the Immigration Skills Charge for the dependents of the staff member that you are sponsoring. This is a great relief for many, as the costs of paying for dependents as well may prove too prohibitive for most employers.
Is The Immigration Skills Charge Applied to Dependents?
As stated in the section above, you need not pay the Immigration Skills Charge for the dependents of your sponsored employee. The visa holder will, however, need to pay the Immigration Health Surcharge for every member of their family that comes to the UK. This allows them to access free healthcare services in the UK via the National Health Service. This charge is not paid by the sponsor but by the visa applicant.
While the charges put in place by UKVI seem harsh, they are there to ensure that money gets put back into Britain’s Department of Education. This money is then used to try and improve the skills of domestic workers. The main reasoning behind the Tier 2 General Visa is to allow businesses to fill vacancies that cannot be filled by domestic workers. This reasoning also explains why sponsors must perform a Resident Labour Market Test before offering a job to a foreigner as it displays the need for a migrant worker.
Is The Immigration Skills Charge Refundable?
There are some instances where things may not exactly go as planned with your employee. In some of these instances, you may claim back part or all of the fees that you have paid. Below, we have laid out some situations where you may claim at least a partial refund of the Immigration Skills Charge:
You will get a full refund if:
- The application has been refused or withdrawn
- The application is successful, but they do not come and work for you
- The applicant gets less time on their visa than you sponsored them for
- The applicant begins working for you but then changes to another sponsor
- The applicant leaves their job before the end date on their Certificate of Sponsorship
In most circumstances, you will receive a refund within 90 days. If you do not receive your refund within this time, you will need to contact UKVI directly, who will help to process your refund.
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