Employers of Non EEA Workers Now Facing Increased Costs

From 6 April 2017, the Immigration Skills Charge Regulations 2017 are in operation. These Regulations call for sponsoring employers of migrant workers employed under Tier 2 of the points-based immigration system to pay a new charge known as the ‘Immigration Skills Charge’. Here we answer the most commonly asked questions on the subject.

What is the Immigration Skills Charge?

The Immigration Skills Charge (ISC) is now levied upon all voluntary and private sector employers of more than 250 staff. The charge will be £1,000 per certificate of sponsorship per year and there are concessions for charities and smaller businesses which will pay a reduced rate of £364.

The ISC is payable on top of the cost of the certificate of sponsorship. Other fees, including the Immigration Health Surcharge plus visa application fees, some of which have also increased as of 6 April, are also payable in addition.

Are There any Exemptions?

Exemptions apply to Tier 2 migrants sponsored before 6 April 2017 applying from inside the UK to extend their visa; Tier 2 migrants employed in a specified PhD level job; Tier 2 graduate trainees taking the Intra-Company Transfer route; Tier 2 migrants remaining with the same or a different sponsor; international students switching from Tier 4 student visas to Tier 2 working visas, and dependents of Tier 2 workers.

Why has the Charge Been Introduced?

The ISC is intended to decrease the number of businesses employing migrant workers, hoping that they will instead recruit and train British staff so that the UK continues to attract talented students and the most highly qualified migrants. There is also the goal of protecting the country’s leading reputation for education and research.

Is Anything Else Changing?

As well as the introduction of the ISC, the minimum salary threshold for workers sponsored under Tier 2 (general) has increased from £25,000 to £30,000 per annum. The threshold for UK-based graduates will not change from £20,800.

On the contrary, the minimum salary for non-European Economic Area (EEA) graduate trainees coming to the UK via the Intra-Company Transfer has dropped from £24,800 to £23,000 per year. This would suggest that the Government has given due consideration to businesses transferring overseas branch workers to their UK offices.

The Government may in future also decide to levy a similar charge to the ISC on employers of EU nationals, if UK immigration minister Robert Goodwill’s proposal is accepted. However, business leaders are up in arms about the suggestion, so it may well be side lined.

With Brexit looming and the Government not stepping forward to reassure employers as to the situation with their existing EU workers, uncertainty is rife.

Should anything concrete arise we will of course let you know. In the meantime, should you have any queries concerning how to deal with employing migrant workers, why not seek advice from your local bookkeepers?

Regular Bulletins

Sign up to our regular Office Assistants newsletter and get special offers and discounts.

Sign up

Investors in PeopleThe Institute of Certified Bookkeepers

Company's Practice Number: 4635

This website uses cookies as outlined in the cookies policy