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Visa costs to soar with introduction of Immigration Skills Charge in April

View profile for Kathryn Dooks

From 6 April 2017, all employers issuing certificates of sponsorship to non-EEA migrants in order to obtain a Tier 2 work visa will need to pay the “Immigration Skills Charge” on top of the usual certificate fee. Unless the employer qualifies as a “small company” under the Companies Act 2006, the Immigration Skills Charge is £1,000 per year of the visa (for small companies it is £364 per year). This is an extremely significant hike in the cost of obtaining talent from outside the EEA.

The charge is intended to reduce the demand for migrant labour and to incentivise employers to upskill the British workforce. But it comes at a time when companies (particularly in the tech sector) are already fearing for their ability to fill technical positions post-Brexit. It is likely that this combination will only serve to stifle growth or ensure that international businesses locate staff offshore. The sums collected will be used by the government to address skills gaps in the UK workforce but this is a much longer-term solution.

There are exceptions to the charge for:

  • non-EEA nationals who were sponsored in Tier 2 before 6 April 2017 and are applying from inside the UK to extend their Tier 2 stay with either the same sponsor or a different sponsor
  • Tier 2 (Intra-company Transfer) Graduate Trainees
  • PhD level occupations
  • Tier 4 student visa holders in the UK switching to a Tier 2 (General) visa

You also do not have to pay the skills charge for the worker’s family members (‘dependants’).