The Immigration Skills Charge


The Immigration Skills Charge

There is no denying the need to continue employing staff from outside the EU especially in view of the UK shortage of skilled staff in certain sectors

However, in April 2017, the UK government introduced the Immigration Skills Charge to reduce Britain’s reliance on migrant workers and to up-skill British workers.

The ONS analysis on international immigration and the labour market, shows that 3.4 million migrants work in Britain, making up 11% of the UK’S 30.3million workforce.

The Skills Charge is a fee levied on employers that employ migrants in certain skilled areas. It costs £1,000.00 per employee per year. A reduced rate of £364.00 applies for small or charitable organisations.

The reason for the charge is to cut down the number of businesses taking on migrant workers and to incentivise businesses to look to the UK labour to fill those jobs.

But has the Skills Charge made a difference or is it just another tax on companies?

The companies we have spoken to say that they employ migrants because they have the experience or skills set required at the time of their engagement to advance their business or to add immediate value to their services. They said if they are not able to obtain the skills they require from within the EU they will continue to employ migrant workers from outside.

The Skills Charge applies to both Tier 2 ‘General’ and ‘Intra-company Transfer’ categories and where applications are submitted from:

  • outside the UK for a visa
  • inside the UK to switch to Tier 2 from another visa
  • inside the UK to extend existing Tier 2 visa Exemptions to the skills charge

The Skills Charge will not apply when sponsoring:

  • A Tier 2 migrant that was sponsored before 6 April 2017 and is applying from inside the UK to extend their Tier 2 stay with the same or different sponsor
  • Tier 2 (Intra-company Transfer) Graduate Trainees
  • a Tier 2 migrant to do a specified PhD level occupation
  • a Tier 4 student visa holder in the UK switching to a Tier 2 (General) visa
  • Tier 2 family members (‘dependants’).

Whilst many employers will still seek to employ migrant workers, the Skills Charge makes it more expensive for employers with Tier 2 sponsorship licences to employ non-EEA migrants on Tier 2 visas.

As most sponsored migrants are permitted to remain in the UK for up to 5 years an employer could pay as much as £5,000.00 by way of Skills Charge in addition to the fees for the sponsorship licence.

In view of the cost of employing a person from outside of the EU it is important that employers get the right advice. Whether you are thinking about applying for a sponsorship licence or whether you have one and wish to understand more about the new skills charge and how it may impact upon your company please contact our immigration department where our specialists will be pleased to assist.



Kezia Daley

Senior Associate

Immigration Specialist

Contact: 020 7408 8888