Immigration Skills Charge (ISC) is an important element of the UK immigration system. It is a fee that employers must pay when hiring workers from outside the European Economic Area (EEA). The charge was introduced in April 2017 and it is designed to help ensure that businesses in the UK are investing in training for British workers. In this blog post, we will explore what the Immigration Skills Charge is, who is affected by it and how it works.

What is the Immigration Skills Charge

The Immigration Skills Charge (ISC) is a fee that employers in the UK must pay if they wish to hire skilled workers from outside the European Economic Area (EEA). The ISC was introduced in April 2017 and applies to all employers who wish to sponsor a worker through skilled workers of the points-based immigration system.

The ISC is payable for each sponsored worker and is based on the duration of the sponsorship. The fee starts from £364 per year for small or charitable organisations, and up to £1,000 per year for larger companies. The money raised by the charge is used to fund initiatives that help UK citizens to gain the skills needed for employment in the UK. 

Employers are responsible for paying the ISC upfront, either online or by post, when they make an application for a Certificate of Sponsorship. Failure to pay the fee may result in a delay or refusal of the application. It is important to note that while employers are liable to pay the fee, they can recover the cost from their sponsored worker. 

Purpose of the charge

The purpose of the charge is to ensure that businesses in the UK invest in the training of UK citizens in order to fill the skill gaps that exist in the UK workforce. 

Immigration Skills Charge is a fee charged to employers of non-EEA nationals who are employed in the UK. The charge was introduced in 2017 and is intended to fund apprenticeships and training opportunities for British workers. It is seen as a way to make sure that UK employers are investing in their domestic talent and helping to reduce net migration levels. The fees are also used to fund careers advice and guidance for young people, as well as research into skills shortages and development opportunities. The funds generated from the Immigration Skills Charge are distributed by the government to a range of organizations, including Universities, charities and training providers. These organizations are then responsible for creating new opportunities for British citizens.

Who is required to pay the Immigration Skills Charge

The Immigration Skills Charge is a levy imposed on employers who want to sponsor skilled non-EEA workers. This means that the employer will be required to pay £1,000 per employee per year of the sponsorship.

Employers who wish to sponsor employees under skilled workers of the Points Based System are required to pay the Immigration Skills Charge. However, there are some exemptions and reductions that may apply in certain circumstances. 

Those who wish to sponsor an employee for a Temporary Worker visa are also required to pay the Immigration Skills Charge. The amount payable depends on the length of the visa and the salary of the employee. For example, if the worker is being sponsored for 12 months and has a salary of more than £155,300, then the employer will have to pay £5,000 in Immigration Skills Charge.

In addition, some other visa categories such as Tier 4 (Student) and skilled worker (Intra Company Transfer) visas may also require payment of the Immigration Skills Charge. 

Ultimately, it is the responsibility of the employer to ensure they are aware of their obligations when sponsoring a non-EEA worker.

Exemptions and reductions apply to some types of sponsorships and visa categories

The Immigration Skills Charge (ISC) is an immigration-related fee payable by employers who sponsor certain categories of non-EEA nationals in the UK. It is important to note that there are certain exemptions and reductions available for employers who sponsor certain categories of non-EEA nationals in the UK.

Those who are exempt from the ISC include:

1. Charities and voluntary organisations that are recognised by the Home Office, as well as institutions approved by the Home Secretary

2. Employers sponsoring non-EEA nationals for the Tier 5 Charity Worker Visa, Tier 5 Creative and Sporting Visa, Tier 4 Student Visa and Tier 1 Entrepreneur Visa. 

3. Dependants of any of the above visa categories

In addition to these exemptions, employers who sponsor certain visa categories may also be eligible for a reduction in the ISC. This includes employers who are sponsoring Tier 2 and 5 work visas, as well as any apprenticeship scheme they may have in place. 

The exact amount of the reduction will depend on several factors such as the size of the business, the number of people being sponsored and whether or not they are a ‘recognised charitable sponsor’. The full details on the exemptions and reductions can be found on the Home Office website. 

It is important for employers to check if they are eligible for any of the exemptions or reductions before submitting their application as this could help them save a substantial amount of money.

How much is the Immigration Skills Charge

The Immigration Skills Charge (ISC) is a levy imposed on UK employers that sponsor migrant workers. The amount of the charge depends on the type of sponsorship and visa category applied for. 

For Sponsorship Licence holders, the ISC is £1,000 per sponsored employee, per year of sponsorship. For skilled worker visa holders, the ISC is £364 per employee, per year of sponsorship. For Tier 5 (Temporary Worker) visa holders, the ISC is £244 per employee, per year of sponsorship.

The ISC is reviewed annually and may be subject to change in accordance with government legislation. Therefore, it is important to stay up to date with the latest regulations to ensure compliance. 

The charge must be paid before a Certificate of Sponsorship can be issued and in order for a migrant worker’s visa application to be successful. Employers who fail to pay the ISC may be liable for civil penalties. 

It is also worth noting that there are exemptions and reductions that apply to some sponsorships and visa categories. Additionally, there are provisions in place for employers who have been granted an extension or switch of the existing visa status of an employee. 

In conclusion, the Immigration Skills Charge is an important levy imposed by the UK Government on UK employers sponsoring migrant workers. The amount of the charge depends on the type of sponsorship and visa category being applied for and must be paid before a Certificate of Sponsorship can be issued. Employers must also ensure they comply with the latest regulations in order to avoid any potential fines.

How is the Immigration Skills Charge paid?

The Immigration Skills Charge is paid through the sponsorship management system when the sponsor applies for a certificate of sponsorship. This charge is separate from any visa application fees. Payment must be made before the certificate of sponsorship is assigned to the worker. The Immigration Skills Charge must be paid in one lump sum, either by credit or debit card, or bank transfer. 

The cost of the Immigration Skills Charge will depend on the type of sponsorship and the visa category for which the certificate of sponsorship is being applied for. The Immigration Skills Charge for a Tier 2 (General) visa is £1,000 per year per worker for large companies and £364 per year per worker for small companies and charities. 

Sponsors are required to keep records of all payments made as evidence that the Immigration Skills Charge has been paid. It is important that sponsors make sure to keep these records up to date and safe. Failure to pay the charge could lead to civil or criminal penalties.

Deadlines and penalties apply for late payment

For most visa and sponsorship applications, sponsors are required to pay the Immigration Skills Charge when they submit their application. Failure to do so could result in a refusal of the application and any associated fees being forfeited.

The Immigration Skills Charge must be paid within 28 days of submitting an application or providing evidence to the Home Office. If a sponsor fails to pay the charge within the specified time frame, they may be subject to a fine of up to £20,000 or up to 10% of their annual turnover (whichever is greater). Sponsors can also face a criminal conviction and an unlimited fine if they are found guilty of failing to comply with immigration law.

It is important that sponsors carefully review all applicable deadlines and penalties before submitting their application, as failure to pay the Immigration Skills Charge can have serious consequences.

Are there any exemptions to the Immigration Skills Charge

Yes, there are certain exemptions and reductions that apply to the Immigration Skills Charge. 

Exemptions apply to certain types of sponsorships and visa categories, such as Tier 4 student visas and Tier 1 (Exceptional Talent) visas. Additionally, those with a recognised Sponsor Certificate from the Home Office are also exempt. 

Reductions are also available for some sponsors, such as those who are recognised as a “UK recognised sponsor”. If a UK recognised sponsor has held their status for 12 consecutive months prior to submitting their sponsorship application, they may be eligible for a 50% reduction on the Immigration Skills Charge.

In addition, other exemptions or reductions may be available for certain groups or types of employers or businesses. For example, charities, voluntary organisations and qualifying educational institutions may be exempt from paying the charge altogether. Similarly, those who wish to employ seasonal workers in the agricultural sector are also exempt from paying the charge. 

It is important to note that the list of exemptions and reductions is subject to change, so it is advisable to check with the Home Office before making any payments.

What will happen if I don’t pay the Immigration Skills Charge

Failure to pay the Immigration Skills Charge can have serious consequences. If the charge is not paid, it can result in the revocation of the sponsor’s licence, as well as fines and other penalties.

In cases where the worker’s visa has already been issued, failure to pay the charge can also result in the worker being barred from entering the UK or having their visa revoked. This could lead to a refusal of entry at the UK border, and in some cases, the worker being deported from the UK. 

Sponsors must ensure that they pay the Immigration Skills Charge in order to remain compliant with UK immigration laws. The charge must be paid before the visa application is submitted, and the due date for payment should be noted in the Home Office letter or email sent to the applicant. Failing to pay the charge by this date can result in penalties or denial of entry into the UK.

Can the Immigration Skills Charge be refunded

The Immigration Skills Charge is not normally refundable. However, in certain circumstances refunds may be available. Refunds may be available if the worker’s visa application is refused or if the worker leaves the UK before the end of the visa period.

In some cases, refund is not possible, such as if the worker overstays their visa or if the sponsor’s license is revoked. If any of these situations occur, the sponsor may be responsible for paying any additional fees or fines that are incurred.

Sponsors should also keep in mind that there may be additional charges and fees associated with the Immigration Skills Charge. For example, sponsors must pay an additional fee for each Certificate of Sponsorship issued, and there is an additional charge for employers who want to pay the Immigration Skills Charge by instalments. 

It is important to understand all of the potential costs associated with the Immigration Skills Charge and to make sure that you have budgeted accordingly before making a sponsorship application. If a refund is possible, sponsors can apply for a refund through the relevant Government website.

Conclusion

The Immigration Skills Charge is an important fee that UK employers must pay in order to sponsor non-EEA workers. The purpose of the charge is to protect UK jobs and make sure that companies are investing in training British employees. It is important to ensure that the charge is paid on time, as late payments can result in financial penalties. Companies may be exempt from the charge if they are sponsoring certain types of visas or sponsoring for certain types of roles. Additionally, refunds may be available for those who qualify for them. Ultimately, it is important for employers to understand the charge and their responsibility to pay it in order to remain compliant with the law.

Frequently asked questions

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