Do I Need to Pay the Immigration Skills Charge?

The Immigration Skills Charge (ISC) is a fee introduced by the UK government as part of its immigration system. It's designed to incentivize employers to invest in the training and development of their UK-based workforce rather than relying on skilled migrants. The charge applies to employers who sponsor skilled workers under the Tier 2 (General) visa route or the Skilled Worker visa route. This article explores whether you need to pay the ISC, the criteria for exemption, and how it impacts employers and employees.

The ISC is a significant factor in the UK’s immigration and employment landscape. It’s crucial to understand whether it applies to your situation to avoid unexpected costs and ensure compliance with immigration regulations. The following sections delve into various aspects of the ISC, including who is liable to pay, the amount required, and the exemptions that might be available.

Who Needs to Pay the ISC?
If you are an employer sponsoring a worker on a Tier 2 (General) or Skilled Worker visa, you are typically required to pay the ISC. The charge is applicable to all employers regardless of their size or sector, though there are certain exemptions and considerations that might affect the final obligation.

Amount of the ISC
The charge varies depending on the size of the sponsoring organization and the type of worker being sponsored. For large employers, the ISC is higher than for small or charitable organizations. The fee structure as of the latest update includes:

• £1,000 per year for large employers
• £364 per year for small or charitable organizations

Exemptions from the ISC
Certain categories of employers and workers are exempt from paying the ISC. These include:

1. Small or Charitable Organizations: As mentioned, small and charitable organizations pay a reduced fee.
2. PhD-Level Jobs: Roles that are on the shortage occupation list or are deemed as PhD-level jobs may be exempt.
3. Transfer within Multinational Companies: Intra-company transfers might have different ISC requirements.

Impact on Employers and Employees
The ISC has a direct impact on both employers and employees. For employers, it represents an additional cost when sponsoring skilled workers. This can affect hiring decisions and overall budgeting. For employees, particularly those on Tier 2 (General) visas, the charge can indirectly influence job opportunities and employer choices.

How to Pay the ISC
The ISC is paid as part of the sponsorship process through the online sponsorship management system. Employers must ensure that the charge is paid at the time of issuing the Certificate of Sponsorship (CoS) for the worker.

Conclusion
Understanding the Immigration Skills Charge is essential for employers navigating the UK's immigration system. The charge is a significant consideration that can influence hiring practices and costs. By knowing whether you need to pay the ISC and what exemptions might apply, you can better manage your sponsorship responsibilities and financial planning.