Published on December 17, 2025 at 18:17 PM | Category: Job Placement
UK Businesses Hit With 32% Hike In Immigration Skills Charge As New Fees Take Effect
The UK government has implemented a 32% increase to the Immigration Skills Charge (ISC), effective 16 December 2025. This mandatory levy, which must be paid upfront by employers sponsoring international workers, now rises to £1,320 per year for medium and large businesses and £480 per year for small or charitable organizations. The hike is part of a broader strategy to encourage investment in the domestic UK workforce and reduce reliance on overseas recruitment.
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December 17, 2025
A significant increase to the Immigration Skills Charge (ISC) has officially came into force on 16 December 2025, marking a sharp rise in the cost of hiring international talent for UK businesses.
Under the Immigration Skills Charge (Amendment) Regulations 2025, the levy paid by employers to sponsor overseas workers has increased by 32%. This change affects all Certificates of Sponsorship (CoS) assigned on or after today’s date for both the Skilled Worker and Senior or Specialist Worker visa routes.
New Fee Structure
The updated rates apply based on the size of the organization and the duration of the sponsorship:
| Employer Size | Annual Rate (New) | 5-Year Total (ISC Only) |
|---|---|---|
| Small or Charitable | £480 (up from £364) | £2,400 |
| Medium or Large | £1,320 (up from £1,000) | £6,600 |
In addition to the ISC, the Certificate of Sponsorship (CoS) fee remains at the rate set earlier this year of £525. When combined, a large employer sponsoring a worker for five years now faces a total upfront cost of £7,125 per employee, while small businesses will pay £2,925.
Key Compliance Rules
The Home Office has reiterated that the Immigration Skills Charge is a legal liability for the employer. It is strictly prohibited for businesses to pass this cost on to the sponsored worker or to recoup it from their salary. Failure to comply can result in the immediate revocation of the employer’s sponsor license.
Who is Affected?
While most commercial hires fall under these new rates, several exemptions remain in place. Employers do not need to pay the charge for:
- Health and Care Worker visas.
- Certain PhD-level and research roles (e.g., chemical scientists, higher education teaching professionals).
- Workers switching from a Student visa to a Skilled Worker visa within the UK.
Impact on Industry
Legal experts and recruitment specialists have warned that the “steep” increase may force companies to re-evaluate their international hiring budgets. “For organizations relying heavily on overseas specialists, this 32% jump is a material change in expenditure,” noted a leading immigration consultant. “It moves the ISC from a standard administrative cost to a major strategic factor in workforce planning.”
Small businesses continue to qualify for the lower rate if they meet at least two of the following: an annual turnover of £15 million or less, total assets of £7.5 million or less, or 50 employees or fewer.
Source: The Immigration Skills Charge (Amendment) Regulations 2025 (SI 2025/1078)
By Niranjan Remesh
Digital Marketing Executive
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