Immigration Skills Charge (ISC)

What is the Immigration Skills Charge?

If you are a UK-based business planning to recruit a foreign worker through the Skilled Worker visa route, you will be required to pay the Home Office an additional fee at the time of assigning a Certificate of Sponsorship (CoS) to your foreign hire. This upfront, mandatory fee is officially known as the immigration skills charge (ISC).

This fee is also payable if you are transferring your overseas employee to the UK for a limited time through the Senior or Specialist Worker visa under the Global Business Mobility route. How much ISC you pay depends on the size and nature of your organisation. You may also be fully exempted from paying this fee depending on the occupation category for which the foreign worker is being hired.

The ISC was launched on 6 April 2017 under the Immigration Skills Charge Regulations to address the skills gap in the UK’s domestic labour market. By making the process of hiring a foreign national costlier for sponsoring organisations, the authorities sought to encourage such employers to train and upskill domestic workers instead.

In line with this strategy, the UK government allocates the funds raised through the ISC route to the Department for Education. The DoE, in turn, invests the said funds to develop various training programmes to upskill the domestic labour market.

The immigration white paper, titled ‘Restoring Control over the Immigration System’ and published on 12 May 2025, proposed to increase the ISC by 32% (irrespective of the size and nature of your organisation) among other similar measures directed at reducing the UK’s net migration. The increased fee came into effect from 16 December 2025 onwards, per the Immigration Skills Charge (Amendment) Regulations 2025.

When You Do Not Need to Pay the Immigration Skills Charge?

ISC applies only to the Skilled Worker visa and the Global Business Mobility Senior or Specialist Worker visa routes, meaning you will not have to pay the fee for any other UK work visas, including the temporary work visas and the four other Global Business Mobility routes (i.e., the Graduate Trainee, UK Expansion Worker, Service Supplier or Secondment Worker routes).

Moreover, if you are sponsoring a foreign skilled national with any of the following occupation codes, you will not be required to pay the ISC for either the Skilled Worker visa or the Senior or Specialist Worker visa:

• Chemical scientists (2111)
• Biological scientists (2112)
• Biochemists and biomedical scientists (2113)
• Physical scientists (2114)
• Social and humanities scientists (2115)
• Natural and social science professionals not elsewhere classified (2119)
• Research and development managers (2161)
• Other researchers, unspecified discipline (2162)
• Higher education teaching professionals (2311)
• Clergy (2463)
• Sports players (3431)
• Sports coaches, instructors and officials (3432)

There are also certain other circumstances when you will be exempted from paying the ISC, such as:

• If you are sponsoring a foreign national who was assigned a CoS before 6 April 2017
• If your sponsored worker is applying from outside the UK to work in the country for less than six months (if they are applying from within the UK, note that you will have to pay the ISC regardless of the timeframe)
• If you are sponsoring an international student switching to a Skilled Worker or Senior or Specialist Worker visa from their current Student visa in the UK

Also note that the CoS fee and the immigration skills charge apply only for the foreign hire, meaning you will not have to pay this amount for their eligible dependants.

Previously, sponsoring organisations were also exempted from paying the ISC for occupations listed for the Health and Care visa per regulation 4(2)(d) of the Immigration Skills Charge Regulations 2017. This exemption has since been discontinued.

Sponsoring Someone to Switch to a Work Visa from a Study Visa

You are exempted from paying the ISC when recruiting an international student who is switching to a Skilled Worker or Senior or Specialist Worker visa from their current Student visa in the UK. To switch to a Skilled Worker or a Senior or Specialist Worker visa, the Student visa holder must also meet one of the following conditions:

• They have completed the course they were originally sponsored to study
• Their job starts only after the end date of their study course
• They are studying for a PhD full time, and have been for at least 24 months

While the exemption from paying the ISC may be seen as an incentive to UK businesses hiring international students, note that both you and your foreign recruit will need to meet strict criteria in doing so. Consulting with a reputed business immigration attorney is recommended before you consider hiring a Student visa holder in the UK, even if they meet all the visa requirements.

Sponsoring Someone on the Global Business Mobility Senior or Specialist Worker Route

If you are sponsoring a foreign worker under the Senior or Specialist Worker route and they meet all of the following conditions, you will not be required to pay the ISC:

• They meet the eligibility requirements for the Senior or Specialist Worker visa
• They were assigned a CoS on or after 1 January 2023
• They usually work in the European Union (EU) for your EU business but have been transferred to work in the UK for limited period of time
• They hold an EU passport or a Latvian non-citizen’s passport
• The specified end date of the said transfer as mentioned on their CoS is 36 months or less from the start date

Consequences If the Person You Are Sponsoring Changes Jobs

If your foreign employee moves to a new job within your UK company, you will be required to assign them a new CoS (note that a new CoS is only required when the new job falls under a different occupation code than what the concerned foreign worker was initially sponsored for). If this new CoS extends the worker’s initial visa validity period, you will be required to pay additional ISC for the extra time.

However, if shifting to a new job does not extend their total visa validity time, you will not be required to pay any additional fee, since you have already paid the full amount of applicable ISC for their entire visa duration while assigning them the initial CoS.

On the other hand, if the sponsored foreign worker changes their employer during their visa validity period, you will get a partial refund as the amount of ISC is calculated based on the length of time the foreign national is supposed to work for you in the UK.

Let’s say you have sponsored a Skilled Worker for three years. After working in the UK for two years, they are either:

• Shifting to a new job under a different occupation code within your organisation which would require them to work for you for an additional six months over and above three years, or
• Resigning from your company to take a new job in the UK

In the first scenario, you will need to pay the ISC for an additional six months. In the second case, you will get a partial refund of the ISC worth one year.

How Much is Immigration Skills Charge: Understanding the Cost

How much ISC you are required to pay vary on a case-to-case basis depending on two factors:

• The size and nature of your UK company/organisation
• The length of time the foreign hire will be working for you

If you are a small or charitable organisation, you will be required to pay the ISC amount of £364 per sponsored foreign worker for the first 12 months. Then for each additional six months per foreign employee, the ISC payable will be £182.

On the other hand, if you are a medium to large sponsor, you will be required to pay the ISC amount of £1,000 per foreign worker for the first 12 months. Then for each additional six months per foreign employee, the ISC payable will be £500.

Calculation Based on Worker’s Employment Duration

You will be required to pay the ISC for at least 12 months even if your foreign employee will be working for you more than six months but less than a year. So, the minimum ISC amount to be paid is £364 for small or charitable entities and £1,000 for medium or large organisations.

On the other hand, you can sponsor a foreign worker for a maximum of five years under the Skilled Visa or the Sponsor or Specialist Worker visa route. So, the maximum payable amount will be either 5 X £364 for small or charitable organisations, or 5 X  £1,000.

Note that the Home Office will be in touch in case you have paid the wrong amount, or have not paid the ISC at all. You must settle the due within 10 working days from the date you have heard from the authorities. Otherwise, your foreign hire’s visa application will be refused.

Identifying Small or Charitable Sponsor Status

Authorities will consider your UK organisation a small entity if you meet at least two of the following eligibility criteria:

• Your company has an annual turnover of up to £15 million
• Your company’s total assets are not worth more than £7.5 million
• Your company has a maximum of 50 employees

To be considered as a charitable organisation, you must be one of the following:

• A registered charity in England, Wales, Scotland or Northern Ireland
• An excepted charity
• An exempt charity
• An ecclesiastical corporation established for charitable purposes

You will need to provide proof of your charitable status for tax purposes from HM Revenue and Customs (HMRC) in case your organisation is not on the register. UK Visas and Immigration (UKVI) runs a Business Helpdesk that can help you understand whether you are a small or charitable sponsor or not, in case you are unsure which category your UK business falls under.

How to Pay the Immigration Skills Charge?

The ISC is payable along with other CoS charges when you are assigning a CoS to your foreign worker via the sponsor management system (SMS). This applies for both the defined CoS and the undefined CoS.

When you are creating and assigning a CoS on the SMS, you have to review the details you have entered into the system so far on the ‘Confirm CoS details before assigning’ screen. When you read the declaration, tick the box to agree to the terms, and select ‘OK’ on the said screen, you will be directed to the ‘Online payment’ screen to proceed with the payment.

The system will then automatically redirect you to a third-party payment service (Worldpay). You can use a debit or a credit card to make the required payment.

Immigration Skills Charge Refunds

It is possible to get a full or partial refund of the ISC in certain circumstances. A full refund is usually made in case your foreign worker’s visa application:

• Is refused by UKVI or withdrawn by the worker themselves
• Gets entry clearance but the concerned worker does not come to the UK to work for your company

A partial refund is possible if:

• UKVI approves less time on your foreign hire’s visa than they applied for and you sponsored them for
• The sponsored foreign worker starts working for you but then changes to another sponsoring employer within their visa validity period, or leaves their job before the end date mentioned on their CoS
• You paid the ISC applicable for medium or large sponsors while assigning the CoS, but had already notified UKVI of your current small or charitable sponsor status

How Long the Refund Process Takes?

Both full and partial refunds are usually processed within 90 days from:

• When have informed UKVI that the foreign worker has not turned up to work for you on the start date mentioned on the CoS
• The date of expiry mentioned on their CoS (which is valid for three months), in case they have not used the CoS to apply for a visa within those three months
• The refusal or withdrawal date of their visa application
• The CoS assignment date, in case you had already informed UKVI that you were now a small or charitable sponsor

A foreign worker can ask UKVI for an administrative review of their visa refusal decision within 28 days from the date of refusal if they are, and have applied from, outside the UK. If they are in the UK and have applied for the visa from within, the deadline is 14 days. If they do not ask for an administrative review, UKVI will process your ISC refund within 90 days from the 28-day or 14-day deadline, as applicable.

If UKVI dismisses their application for an administrative review, your refund will be processed within 90 days from the date of dismissal.

Passing on the Immigration Skills Charge to the Employee

The ISC is a cost that must be borne by a sponsoring employer. It can never be passed on to your foreign hire. The Home Office has taken a very strict stance on this from the very beginning. Any evidence that you have asked your foreign hire to pay the ISC or any other costs associated with a CoS, or planning to retrieve the said costs from them once they start working for you, will lead to severe consequences for your UK business.

The goal behind introducing the ISC in 2017, or the subsequent 32% increase in the charges in 2025, was to disincentivise UK employers recruiting foreign skilled workers. The UK government wanted these employers to invest and upskill the domestic workforce instead. From this policy perspective, if an employer was allowed, explicitly or implicitly, to pass on the ISC to the foreign hires, they will never be interested in training and developing the domestic staff. This would, in turn, mean a failure of the government’s strategy to induce UK businesses to bridge the skills gaps in the UK labour market.

So, as a sponsoring employer, you cannot pass the ISC or any other sponsoring costs to your foreign recruits under any circumstances. You can neither ask them for a direct repayment or reimbursement, nor can you adjust the amount with their salary. The ISC is an integral part of your commitment as a company holding sponsor licence status in the UK. You must plan accordingly and factor the costs into your foreign worker recruitment budget.

If you are found to be non-complaint, the Home Office may take one or more of the following actions:

• Downgrade your sponsor licence rating
• Suspend your sponsor licence pending a UKVI investigation
• Revoke your sponsor licence

Given the serious impact of non-compliance on your business, you must ensure that your recruitment practices, employment contracts, and/or internal reimbursement policies are in order. Consider consulting with business immigration solicitors to avoid any inadvertent exposure.

How Can IAS Help?

Complying with the ISC rules is non-negotiable. While failing to pay the required amount of ISC on time can lead to unnecessary delay in processing your foreign hire’s visa application or even a straightaway visa refusal, passing on the costs to your overseas employee in any form can lead to a suspension or revocation of your sponsor licence in the UK. You must, therefore, keep in mind the ISC while calculating the sponsorship costs.

If you are a UK business that relies heavily on sponsored foreign workers, the increased ISC applicable from 16 December 2025 onwards can create a significant ‘hole’ in your pocket, so to say. Although certain occupation codes are exempt from the ISC, a significant number of UK jobs where foreign workers prevail today are outside of the purview of such exemptions.

With all this in mind, we recommend that you start early. Plan your foreign worker recruitment strategy wisely, calculate the costs during the workforce planning stage itself, and come up with a comprehensive training and upskilling programme for your existing UK workers or potential workforce (e.g., Student or Graduate visa holders).

At IAS, our team of specialist UK business immigration lawyers have the required expertise and experience to assist you at every step, starting from applying for a sponsor licence, to creating and assigning a CoS, to understanding the upfront as well as hidden costs associated with recruiting foreign talent. We have helped several companies and organizations so far with their business immigration challenges, and are confident to help regardless of the complexity of your case. 

You may choose from any of our existing Advice, Application, Fast Track or Appeal packages, and/or ask for more customisable services as required in your immigration situation. To know more about the bespoke services we provide and how we can help you, dial +44 (0)333 414 9244 to speak to our team today.