Immigration Skills Charge Increase from 16 December 2025: What UK Employers Need to Know

If you’re a UK business that sponsors overseas workers, you’ll want to pay attention to what’s happening on 16 December 2025. The Immigration Skills Charge is going up by about a third, and this change will affect how much you pay when bringing skilled workers into the country.

The Home Office has confirmed that the Immigration Skills Charge increase will see medium and large sponsors paying £1,320 for the first year (up from £1,000), while small and charitable organisations will pay £480 (up from £364). This is the first increase since the charge was introduced back in 2017, and it’s going to have a real impact on recruitment budgets across the UK.

In this article, we’ll break down exactly what’s changing, who it affects, and most importantly, what you can do right now to manage these increased costs. If you have any overseas workers joining your team soon, there might still be time to save money by acting before the deadline.

What is the Immigration Skills Charge?

Let’s start with the basics. The Immigration Skills Charge (ISC) is a mandatory fee that UK employers must pay when they sponsor certain types of overseas workers. Think of it as an additional cost on top of the visa application fees and the Immigration Health Surcharge that sponsored workers already pay.

Understanding the ISC in Simple Terms

The charge was introduced in 2017 with a specific purpose: to fund training and skills development for UK workers. The idea is that if businesses are recruiting from overseas, they should contribute to improving the domestic workforce at the same time. Whether you agree with that logic or not, it’s been part of the UK’s immigration system for nearly eight years now.

The money collected from the Immigration Skills Charge goes into the Consolidated Fund, which the government uses to support apprenticeships and vocational training programmes across the country.

Who Pays the Immigration Skills Charge?

This is important: the employer pays the ISC, not the worker. It’s your responsibility as the sponsor to cover this cost when you assign a Certificate of Sponsorship to an overseas employee. The charge is calculated based on how long you’re sponsoring the worker for, and it must be paid upfront and in full.

Your business size determines how much you’ll pay. UK Visas and Immigration classifies sponsors as either small/charitable or medium/large based on your company’s turnover, balance sheet, and number of employees.

When is the ISC Paid?

You pay the Immigration Skills Charge at the exact moment you assign a Certificate of Sponsorship through the Sponsor Management System. This timing is crucial, especially now with the rate increase coming. The date you assign the CoS determines which rate you’ll pay, not the date the visa application is submitted or approved.

Immigration Skills Charge Rates: What’s Changing on 16 December 2025

The Immigration Skills Charge increase is substantial, so let’s look at the exact figures you’ll be dealing with from mid-December onwards.

New ISC Rates for Medium and Large Sponsors

If your business is classified as a medium or large sponsor, here’s what you’ll be paying from 16 December 2025:

• First 12 months: £1,320 (currently £1,000)
• Each additional 6 months: £660 (currently £500)

That’s a 32% increase across the board. For a standard three-year Skilled Worker visa, you’ll now be paying £3,960 upfront instead of the current £3,000.

New ISC Rates for Small and Charitable Sponsors

Small businesses and registered charities get a reduced rate, but you’re still facing the same percentage increase:

• First 12 months: £480 (currently £364)
• Each additional 6 months: £240 (currently £182)

For a three-year sponsorship, that’s £1,440 compared to the current £1,092.

Before and After Comparison Table

Here’s a clear breakdown of how the rates compare:

Medium and Large Sponsors:

• First 12 months: £1,000 → £1,320
• Each additional 6 months: £500 → £660

Small and Charitable Sponsors:

• First 12 months: £364 → £480
• Each additional 6 months: £182 → £240

How Much Will This Cost Over 5 Years?

Let’s look at the long-term impact. For a five-year sponsorship (which is the maximum for most Skilled Worker visas), the total Immigration Skills Charge will be:

Large sponsors: £6,600 (up from £5,000) Small sponsors: £2,400 (up from £1,820)

That’s an extra £1,600 or £580 respectively over the full sponsorship period. Multiply that by the number of overseas workers you sponsor each year, and you’ll quickly see why this matters to your bottom line.

Which Visa Routes Are Affected by the ISC Increase?

Not every UK work visa requires payment of the Immigration Skills Charge. Only two routes are affected by this fee and the upcoming increase.

Skilled Worker Visa and the ISC

The Skilled Worker route is the main pathway for UK businesses to recruit overseas talent for permanent or long-term roles. If you’re sponsoring someone on this visa, you’ll need to pay the Immigration Skills Charge unless they qualify for an exemption (more on that shortly).

Most overseas workers coming to the UK for skilled employment will be on this route, which is why the Immigration Skills Charge increase matters so much to businesses across all sectors.

Global Business Mobility Senior or Specialist Worker Route

The other visa route affected is the Global Business Mobility Senior or Specialist Worker category. This is typically used for intra-company transfers where multinational organisations move senior staff or specialists to their UK operations.

If you’re bringing workers to the UK under this route, you’ll also face the increased Immigration Skills Charge from 16 December 2025. The same rates apply based on your organisation’s size.

Immigration Skills Charge Exemptions in 2025

Good news: not everyone has to pay. There are several situations where the ISC doesn’t apply, and some new exemptions are being introduced alongside the rate increase.

New Occupation Code Exemptions from 16 December 2025

From 16 December 2025, Certificates of Sponsorship assigned for the following occupation codes will be completely exempt from the Immigration Skills Charge:

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

If you’re recruiting for any of these roles, the Immigration Skills Charge increase won’t affect you at all. These exemptions reflect the government’s recognition that certain sectors need continued support for international recruitment.

Existing ISC Exemptions Still in Place

Several important exemptions were already in place before the rate increase, and they’re continuing. These include:

Health and Care Worker Exemption

Workers sponsored under the Health and Care Worker visa route don’t pay the Immigration Skills Charge. This exemption has been in place since 2020 and recognises the NHS and social care sector’s reliance on overseas staff.

Student Visa Switchers

If someone is already in the UK on a Student visa and switches to a Skilled Worker visa, the Immigration Skills Charge doesn’t apply. This exemption encourages UK universities’ international graduates to stay and work in the country after completing their studies.

Short Assignments Under 6 Months

Sponsorships lasting less than six months are exempt from the ISC. This can be useful for short-term projects or temporary assignments where the full charge wouldn’t be proportionate.

How to Avoid Paying the Higher ISC Rate

Here’s the question everyone’s asking: can you still pay the current lower rate even after 16 December? The answer is yes, but you need to act quickly.

Assign Your Certificate of Sponsorship Before 16 December 2025

The key date is when you assign the Certificate of Sponsorship, not when the visa application is submitted or approved. If you assign a CoS through the Sponsor Management System before 16 December 2025, you’ll pay the current lower rate.

This gives you a window of opportunity if you have recruitment plans already in motion. Any roles you were planning to fill in early 2025 could potentially be brought forward to beat the Immigration Skills Charge increase.

What Happens if You Assign a CoS Early?

Assigning a Certificate of Sponsorship early is allowed, but there are practical considerations. The worker typically has three months from the CoS assignment date to submit their visa application. If you assign too early and they don’t apply within that window, the CoS will expire and you’ll need to assign a new one (and pay the higher rate if we’re past 16 December).

Work with your recruitment team and the overseas worker to make sure the timing makes sense. You want to beat the deadline, but you also need the application to be ready to submit.

Can You Submit the Visa Application Later?

Yes, absolutely. As long as the CoS is assigned before 16 December 2025, the lower Immigration Skills Charge rate applies even if the actual visa application isn’t submitted until January 2026 or later. The Home Office guidance makes this clear: the ISC liability is locked in at the point of assignment.

This gives you some flexibility. You can assign the CoS now to secure the current rate, and the worker can still take time to prepare their application documents and book their visa appointment.

The Real Cost Impact on UK Employers

Let’s talk about what this Immigration Skills Charge increase actually means for your business finances.

Budget Planning for 2025 and Beyond

The 32% increase isn’t something you can ignore in your recruitment budget. If you typically sponsor 10 overseas workers per year on three-year visas, that’s an extra £9,600 annually for large sponsors or £3,480 for small businesses. These aren’t trivial amounts.

You’ll need to update your approval processes and make sure hiring managers understand that international recruitment now comes with a higher upfront cost. Finance teams should factor this into 2025 budget planning, especially if you operate in sectors that rely heavily on overseas talent.

How This Affects Small Businesses vs Large Corporations

The percentage increase is the same for everyone, but the impact varies. A small business sponsoring one or two workers a year will feel the pinch differently than a multinational moving dozens of staff to the UK.

For smaller organisations, the increased cost might genuinely influence whether international recruitment remains viable for certain roles. You might find yourself weighing up whether the additional £580 over five years is justified compared to searching harder for UK-based candidates.

Larger corporations will face a bigger total cost across their workforce, but they typically have more resources to absorb the increase. Still, compliance and global mobility teams will need to update their standard operating procedures and ensure all stakeholders understand the new rates.

Calculating the Total Sponsorship Cost

Remember, the Immigration Skills Charge is just one component of the total cost of sponsoring an overseas worker. You’re also looking at:

• Certificate of Sponsorship fee: £239 per worker
• The worker’s own visa application fee: from £719 to £1,500+ depending on length
• Immigration Health Surcharge: £1,035 per year paid by the worker
• Potential relocation costs
• Legal and professional fees if you use an immigration solicitor

When you add the increased ISC on top of everything else, the total package for bringing someone to the UK has become noticeably more expensive. This is part of a broader trend of the government making skilled migration more costly and administratively complex.

What UK Employers Should Do Right Now

If you’re reading this before 16 December 2025, here’s your action plan.

Review Your Upcoming Sponsorship Pipeline

Look at any recruitment processes currently underway. Do you have job offers out to overseas candidates? Are there roles you were planning to fill in Q1 2026 that could reasonably be brought forward?

Make a list of every potential CoS assignment in your pipeline and assess whether any can be assigned before the deadline. Even if you save the lower rate on just one or two sponsorships, that’s still several hundred pounds kept in your budget.

Fast-Track CoS Assignments Where Possible

If you have candidates ready to go, work with them to expedite the CoS assignment process. Make sure your sponsor licence is active and compliant, gather the necessary information about the role and the worker, and get that CoS assigned through the Sponsor Management System.

Don’t rush so much that you make mistakes, though. An incorrectly assigned CoS can lead to compliance issues with the Home Office, which is far more costly than the Immigration Skills Charge increase.

Update Your HR and Recruitment Budgets

Even if you can’t beat the deadline for current recruitments, you need to plan for the future. Update your standard costs for international hiring to reflect the new ISC rates. Make sure approval workflows account for the increased expenditure, and brief your finance team so they’re not surprised when the bills come through.

This is also a good time to review your broader recruitment strategy. Are there positions where you might focus more on UK-based candidates? Are there immigration routes other than Skilled Worker that might work for certain roles?

Brief Your Hiring Managers on the Changes

Communication is key. Make sure everyone involved in recruitment decisions understands that the Immigration Skills Charge is increasing and what that means for budget approvals. Hiring managers who aren’t familiar with immigration costs might not realise the impact of this change.

Provide them with updated cost breakdowns for international recruitment, including all the fees involved. This helps them make informed decisions about whether to look overseas or focus on the UK job market for particular vacancies.

Immigration Skills Charge Compliance: Avoiding Home Office Penalties

Getting the Immigration Skills Charge wrong isn’t just about money—it’s a compliance risk that could affect your sponsor licence.

What Happens if You Pay the Wrong ISC Amount?

Paying an incorrect Immigration Skills Charge amount is considered a breach of your sponsor duties. The Home Office takes sponsor compliance seriously, and even honest mistakes can result in a compliance action being recorded against your licence.

If you underpay the ISC, you’ll be required to pay the difference. More seriously, repeated compliance breaches can lead to your sponsor licence being suspended or revoked, which would prevent you from sponsoring any workers until the issues are resolved.

Sponsor Licence Compliance Risks

Your sponsor licence is valuable. Losing it or having it suspended causes immediate problems for your existing sponsored workers and prevents you from recruiting overseas talent until the licence is reinstated.

Make sure whoever manages your sponsorship activities in your organisation understands the new ISC rates and when they take effect. Update your internal procedures and checklists to reflect the 16 December 2025 change date.

Keeping Your Sponsorship Records Updated

The Home Office can audit your sponsorship records at any time. You need to demonstrate that you paid the correct Immigration Skills Charge for each worker based on when the CoS was assigned.

Keep clear records showing the assignment date, the ISC amount paid, and the calculation of how that amount was determined. This makes your life much easier if you ever face a compliance audit or need to respond to Home Office queries.

Long-Term Workforce Planning After the ISC Increase

Beyond the immediate deadline, it’s worth thinking about how the Immigration Skills Charge increase fits into your broader business strategy.

Is International Recruitment Still Worth It?

For most businesses, the answer is yes. The UK job market remains tight in many sectors, and skilled overseas workers continue to fill critical gaps. An extra £1,600 over five years is significant, but it’s often still cheaper than leaving a position unfilled or compromising on candidate quality.

That said, the cumulative effect of various immigration policy changes—higher fees, increased salary thresholds, more complex compliance requirements—does mean that sponsoring overseas workers is becoming less attractive financially. Some businesses are responding by investing more in UK workforce development, apprenticeships, and training programmes.

Alternative Immigration Routes to Consider

The Skilled Worker visa isn’t your only option. Depending on your circumstances, other routes might make sense:

• Graduate visa holders: If someone is already in the UK on a Graduate visa, you can recruit them without needing to sponsor them immediately
• Global Talent visa: For certain highly skilled individuals in tech, science, and the arts
• Scale-up visa: For fast-growing companies that meet specific criteria

None of these routes require payment of the Immigration Skills Charge, though they each have their own requirements and limitations.

Balancing Overseas Talent with Domestic Hiring

The Immigration Skills Charge increase is a nudge from the government to invest more in UK-based talent. While this might feel frustrating if you’re struggling to fill roles, it’s worth considering how you can develop domestic talent pipelines alongside international recruitment.

This might mean stronger links with universities, more apprenticeship programmes, or investing in training existing staff to move into more skilled positions. The money you save on ISC fees could potentially be redirected into these initiatives.

How Deluxe Law Chambers Can Help Your Business

The Immigration Skills Charge increase is just one of many changes affecting UK employers who sponsor overseas workers. At Deluxe Law Chambers, we work with businesses across the North West and throughout the UK to make sense of immigration requirements and keep your recruitment plans on track.

Whether you need urgent advice on assigning Certificates of Sponsorship before the deadline, want to review your sponsor licence compliance, or need strategic guidance on managing increased sponsorship costs, our team can help.

We understand that immigration law can feel complicated, especially when rules and fees keep changing. Our approach is straightforward: we explain what you need to know in plain English, help you make informed decisions, and handle the legal details so you can focus on running your business.

If you’re concerned about how the Immigration Skills Charge increase will affect your recruitment budget or you need help with any aspect of sponsoring overseas workers, get in touch.

Call us on 0161 464 4140 or book an appointment online.

The Immigration Skills Charge increase from 16 December 2025 represents a significant cost uplift for UK businesses that rely on overseas talent. With rates rising by 32% across the board, the total five-year cost of sponsoring a worker will increase from £5,000 to £6,600 for large sponsors and from £1,820 to £2,400 for small organisations.

If you have any recruitment processes underway, now is the time to review whether Certificates of Sponsorship can be assigned before the deadline to secure the lower rate. Update your budget planning, brief your hiring managers, and make sure your compliance procedures reflect the new rates.

While the increased costs are unwelcome, international recruitment remains a vital tool for many UK businesses facing skills shortages. With proper planning and professional advice, you can continue building the workforce your business needs while managing the financial impact of these changes.

For personalised advice on the Immigration Skills Charge increase and your sponsorship obligations, contact Deluxe Law Chambers on 0161 464 4140 or book your appointment here.

Frequently Asked Questions About the Immigration Skills Charge Increase