UK employers that sponsor Skilled Worker migrants look set to pay markedly more next year: the Immigration Skills Charge (Amendment) Regulations 2025 will be scrutinised in the House of Lords Grand Committee this Thursday, 4 December, after the Secondary Legislation Scrutiny Committee flagged the measure as “politically and legally important.” The draft regulations, laid before Parliament last week, propose to raise the levy by 32 %—in line with cumulative inflation since the fee was last adjusted in 2017.
If approved, the up-rating will lift the headline charge from £1,000 to £1,320 per sponsored worker per year for medium and large firms, and from £364 to £480 for charitable sponsors and small businesses. A typical four-year sponsorship could therefore cost a multinational £5,280 in skills charge alone, before application fees, health surcharges and legal costs. The government argues the increase protects UK taxpayers by ensuring employers “make an appropriate contribution” to domestic skills training while maintaining the attractiveness of the Skilled Worker route.
Business groups are alarmed. The Confederation of British Industry warned that the hike, coming on top of an April 2025 jump in the Health and Care surcharge and impending digital-status implementation costs, will push total onboarding expenditure for a senior engineer above £10,000. Small tech start-ups—already hit by tighter salary thresholds and restrictions on dependant visas—say the increase risks diverting investment abroad. Universities UK, representing higher-education sponsors, noted that research labs often rely on multi-year fixed-grant budgets that did not anticipate a 32 % surcharge rise.
![House of Lords to debate 32 % hike in Immigration Skills Charge, escalating sponsorship costs for UK employers]()
Immigration lawyers advise sponsors with live headcount plans to front-load Certificate of Sponsorship (CoS) assignments before the higher tariff takes effect (expected early Q1 2026). Certificates issued and paid for before commencement will be honoured at the old rate, even if the visa application is lodged later. Companies should also review claw-back clauses in offer letters: many agreements recoup skills-charge costs from employees who leave within the first two years, and the higher fee may require amending repayment schedules to remain compliant with updated Appendix Skilled Worker rules on unlawful salary deductions.
Politically, the regulations are a litmus test of Labour’s promise to “reduce net migration without harming growth.” Raising the skills charge allows ministers to claim they are disincentivising reliance on overseas labour while generating revenue for apprenticeship schemes, yet critics say it amounts to a stealth tax on productivity. Peers are expected to press ministers for evidence that levy proceeds are ring-fenced for training and to ask why a differential rate is not applied to shortage-occupation roles.
Whatever the parliamentary sparring, HR and global-mobility teams must budget for higher outlays imminently and communicate the changes to hiring managers. Failure to factor in the revised levy could leave approved CoSs unfunded and delay critical talent moves at the start of the next financial year.
If approved, the up-rating will lift the headline charge from £1,000 to £1,320 per sponsored worker per year for medium and large firms, and from £364 to £480 for charitable sponsors and small businesses. A typical four-year sponsorship could therefore cost a multinational £5,280 in skills charge alone, before application fees, health surcharges and legal costs. The government argues the increase protects UK taxpayers by ensuring employers “make an appropriate contribution” to domestic skills training while maintaining the attractiveness of the Skilled Worker route.
Business groups are alarmed. The Confederation of British Industry warned that the hike, coming on top of an April 2025 jump in the Health and Care surcharge and impending digital-status implementation costs, will push total onboarding expenditure for a senior engineer above £10,000. Small tech start-ups—already hit by tighter salary thresholds and restrictions on dependant visas—say the increase risks diverting investment abroad. Universities UK, representing higher-education sponsors, noted that research labs often rely on multi-year fixed-grant budgets that did not anticipate a 32 % surcharge rise.
Immigration lawyers advise sponsors with live headcount plans to front-load Certificate of Sponsorship (CoS) assignments before the higher tariff takes effect (expected early Q1 2026). Certificates issued and paid for before commencement will be honoured at the old rate, even if the visa application is lodged later. Companies should also review claw-back clauses in offer letters: many agreements recoup skills-charge costs from employees who leave within the first two years, and the higher fee may require amending repayment schedules to remain compliant with updated Appendix Skilled Worker rules on unlawful salary deductions.
Politically, the regulations are a litmus test of Labour’s promise to “reduce net migration without harming growth.” Raising the skills charge allows ministers to claim they are disincentivising reliance on overseas labour while generating revenue for apprenticeship schemes, yet critics say it amounts to a stealth tax on productivity. Peers are expected to press ministers for evidence that levy proceeds are ring-fenced for training and to ask why a differential rate is not applied to shortage-occupation roles.
Whatever the parliamentary sparring, HR and global-mobility teams must budget for higher outlays imminently and communicate the changes to hiring managers. Failure to factor in the revised levy could leave approved CoSs unfunded and delay critical talent moves at the start of the next financial year.
