From 16 December 2025, the Immigration Skills Charge (ISC) will rise by approximately 32%. This increase will significantly raise the overall cost of sponsoring overseas workers under the Skilled Worker route.
Why is the Immigration Skills Charge increasing?
The Immigration Skills Charge (ISC) was introduced to encourage UK employers to invest in and train the domestic workforce, reducing dependence on overseas labour.
It is a fee paid by sponsoring employers for each skilled worker they employ, with funds intended to support training and skills development programmes across the UK.
The ISC acts both as a funding mechanism for workforce development and as a financial incentive for businesses to prioritise recruiting and upskilling local talent.
The forthcoming increase forms part of a broader government strategy to ensure that immigration policy supports the UK’s skills and training objectives. In practice, this means encouraging employers to build internal talent pipelines rather than relying on migration to address persistent skills shortages.
Key policy drivers include:
- Boosting the domestic workforce. Using the additional revenue to fund initiatives that enhance the skills of UK-based workers.
- Encouraging investment in local talent. Incentivising employers to train and retain existing staff through structured upskilling programmes.
- Reducing reliance on overseas workers. Supporting sectors to become more resilient and less dependent on immigration to meet labour needs.
- Adjusting for inflation. The charge has remained unchanged since its introduction in 2017; the increase reflects inflationary pressures over that period.
Earlier this year, the UK Government’s Immigration White Paper confirmed plans to raise the ISC as part of a wider set of immigration reforms. This aligns with the Labour Government’s strategy to reduce net migration and promote long-term investment in the domestic workforce through targeted training initiatives.
Current vs New ISC Rates
| Sponsor size | Current ISC (before 16 Dec 2025) | New ISC (from 16 Dec 2025) |
| Large/medium | £1,000 for the first 12 months + £500 for each additional 6 months | £1,320 for the first 12 months + £660 for each additional 6 months |
| Small/charitable | £364 for the first 12 months + £182 for each additional 6 months | £480 for the first 12 months + £240 for each additional 6 months |
Example
Costs of sponsoring a worker for three years, inclusive of the Certificate of Sponsorship (COS) fee:
| Duration | Large/medium sponsors | Small/charitable sponsors |
| Current costs | £3,000 ISC + £525 COS = £3,525 | £1,092 ISC + £525 COS = £1,617 |
| New costs (from 16 Dec) | £3,960 ISC + £525 COS = £4,485 | £960 ISC + £525 COS = £1,965 |
The ISC increase will have the greatest financial impact on large and medium sponsors, who will face an additional £960 per sponsored worker, while small and charitable sponsors will see a smaller rise of £348.
Combined with recent visa application fee increases, these changes are expected to place additional financial pressure on employers and may deter some from sponsoring overseas talent altogether.
Although the new ISC rates will apply to both new and existing sponsorships, sponsors should ensure they understand which roles and routes remain exempt.
Who is exempt from paying the ISC?
Some categories of sponsored workers are exempt from paying the Immigration Skills Charge, including:
- Workers applying from outside the UK for a role lasting less than six months
- Existing sponsored workers switching to another role within the same organisation, or transferring under TUPE or similar protection, provided the new Certificate of Sponsorship does not extend their visa
- PhD-level roles, including certain scientists, R&D managers, and higher education teaching professionals
- Workers switching from the Student route, including those extending their permission in the same role with the same sponsor
- Some Global Business Mobility – Senior or Specialist Workers transferring to a UK branch for under three years
- Graduate Trainees sponsored for no more than 12 months
- Scale-up visa workers
From 16 December 2025, the following occupations will also become exempt:
- Clergy
- Sports players
- Sports coaches, instructors and officials
Employers should always check the latest Home Office guidance before assigning a Certificate of Sponsorship, as exemptions are subject to change.
What else employers should note
The Home Office fee table, updated on 21 October 2025 (effective 11 November 2025), confirms further fee increases:
- Expedited processing of a sponsorship management request – from £200 to £350
- Priority service for sponsor licence applications – from £500 to £750
These changes mainly affect employers using priority routes to meet urgent recruitment needs.
Other upcoming immigration changes
From 8 January 2026, main applicants under the Skilled Worker, Scale-up, and High Potential Individual routes must evidence English proficiency at Level B2 (up from B1).
From 1 January 2026, the Graduate route will reduce from two years to 18 months for non-PhD graduates, while PhD graduates will continue to receive three years.
Employers should take these timelines into account when planning recruitment, particularly for graduate and early-career roles that may soon require Skilled Worker sponsorship earlier than before.
Next steps for employers
- Review your sponsorship pipeline and identify workers affected by the ISC increase
- Reassess sponsorship budgets to reflect the higher ISC and service fees
- Submit Certificate of Sponsorship (COS) allocation requests early to avoid delays
- Assign COS before 16 December 2025 where possible to benefit from current rates
- Consider sponsoring workers for the full contract duration (up to five years) to reduce repeat costs
- Assign COS on or after 16 December 2025 where roles will become exempt
- Where appropriate, sponsor international students while they still hold Student route permission, as this remains exempt from the ISC
Final thoughts
While the government’s stated aim is to promote domestic training and reduce reliance on overseas labour, the rising cost of sponsorship underscores the importance of strategic workforce planning and proactive immigration compliance.
If you would like advice on how the ISC increase or related rule changes may affect your business, our team can help you review your sponsorship arrangements and ensure compliance with the latest Home Office requirements.
Why Choose Aristone Solicitors for UK Immigration Advice
At Aristone Solicitors, we know that UK immigration rules change quickly – and every update can impact how your business hires and retains global talent. With the Immigration Skills Charge increase 2025, it’s more important than ever for employers to understand the cost implications of sponsorship and plan strategically.
Our team of experienced immigration solicitors and business visa specialists work closely with companies across the UK to simplify the sponsorship process, ensure compliance with Home Office requirements, and help you save both time and cost. Whether you’re applying for a Skilled Worker licence, managing Certificate of Sponsorship (CoS) allocations, or assessing how the ISC increase affects your recruitment budget, we provide clear, tailored guidance from start to finish.
We believe legal advice should empower, not overwhelm. That’s why we combine technical precision with practical, business-focused solutions – so you can focus on growing your company while we handle the compliance.
Reach out to us today. Let’s ensure your workforce strategy remains strong, compliant, and future-proof.
Aristone Solicitors
– Where clarity meets compliance, and every business finds trusted immigration guidance.
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