New Immigration Skills Charge exemption announced for certain workers

In our previous blog we confirmed that following the new Trade and Co-operation Agreement, a new Immigration Skills Charge (“ISC”) exemption would be available from January 2023 for employers who use the Global Business Mobility – Senior or Specialist Worker route for EU nationals based in an EU overseas office.

What is the new exemption?

The Immigration Skills Charge (Amendment) Regulations 2022 confirms sponsors of the Global Business Mobility – Senior or Specialist route will be exempt from paying the ISC if all of the following apply:

• The CoS was assigned on or after 1 January 2023;
• The worker is a national of an EU country (does not include Iceland, Liechtenstein or Norway) or is a Latvian non-citizen;
• The worker has been assigned to the UK by a business established in the EU and which forms part of the same sponsor group; and
• The end date of the assignment stated on the CoS is no more than 36 months after the start date.

Potential cost saving?

The ISC is a fee paid by employers when sponsoring the majority of workers under both the Skilled Worker and Global Business Mobility – Senior or Specialist Worker routes.

The fee is calculated based on the size of the sponsoring entity and the length of visa being applied for – the fee is incurred at the time of assigning the CoS.

A large company sponsor must pay an ISC fee of £1,000 per year per worker and small and charitable companies must pay £364 per year per worker. The Companies Act 2006 sets out the criteria to meet in order for a company to qualify as ‘small’.

UK Visas and Immigration’s guidance document sets out the other exemptions from paying the ISC fee. Sponsor Licence holders should have a clear understanding of when an ISC exemption may apply as there can be severe consequences if an incorrect exemption from paying the ISC is applied at the time of assigning a CoS.

The above change will benefit businesses in reducing the overall cost of sponsoring group employees who are required to relocate to the UK on a short-term basis.

Should you require further information on the above or the full list of exemptions from paying the ISC fee, please do not hesitate to contact our head of Immigration, Sundeep Rathod.

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