Budget sponsorship by charge, payer and payment date. The Immigration Skills Charge is usually an upfront employer charge linked to the sponsorship period, distinct from the licence application, CoS fee and worker’s own application costs. Do not carry the old £364 or £1,000 annual rates into a new calculation without checking the assignment date and current rules.
Use the current charge structure
At the review date, the published ISC rates are £480 for the first twelve months for small or charitable sponsors, then £240 per additional six months. Medium or large sponsors pay £1,320 initially and £660 per additional six months. Exemptions and period rules must be checked for each assignment. The sponsor must pay the charge itself.
Record the actual start and end dates rather than rounding every hire to “three years.” The official guidance explains how periods are charged. A model can show the arithmetic, but should flag any uncertain exemption or duration treatment for review before a CoS is assigned.
Confirm the sponsor category
Check the current size criteria and charitable status rules. The official application page normally treats a sponsor as small where at least two of the published turnover, assets and employee conditions apply. Keep the supporting finance record and review the classification when the organisation changes.
A familiar label such as “startup” or “SME” is not enough. Ask finance to confirm the relevant measures and date. If the structure is complex or category uncertain, resolve it before the hiring budget assumes the lower band.
Model an illustrative three-year hire
For an illustrative non-exempt thirty-six-month assignment, the ISC arithmetic using those rates is £480 plus four six-month blocks of £240, totalling £1,440 for a small or charitable sponsor. For a medium or large sponsor, £1,320 plus four blocks of £660 totals £3,960. These examples are ISC only, not an all-inclusive sponsorship quote.
Put the CoS fee on a separate line. The current official fee table lists £525 for a Skilled Worker CoS. Add any licence application separately: the Worker licence fee is £611 for small or charitable sponsors and £1,682 for medium or large sponsors. Check the actual fee category when paying.
Keep internal cost allocation lawful
A business can allocate costs between its departments for planning. That is different from recovering prohibited charges from the sponsored worker. Do not use a repayment template or deduction from salary without understanding which amounts can lawfully be included.
Ask legal and HR to review itemised policies before offering relocation support. A single label such as “immigration costs” can combine charges with very different treatment. Keep the licence, CoS, ISC, commercial advice and personal application spending distinct.
Separate gross cash need from possible refunds
Model the full cash outlay first. Keep potential refunds in a separate scenario, supported by the current official eligibility and process. Do not spend an expected refund before it arrives or assume every early departure produces the same amount.
Track each CoS and payment reference so finance can reconcile the result. When a worker does not start or leaves early, send the facts to the sponsorship owner and finance together. A refund review and a sponsor reporting obligation are related workflows, but completing one does not prove the other is done.
Add operational cost without hiding government fees
Include staff time, training, recruitment, professional advice and onboarding as separate planning estimates. Label them as internal assumptions. A board paper should be able to distinguish fixed official charges from a chosen service package or the cost of an extended vacancy.
For multiple hires, model assignment dates and planned durations individually. This shows the cash peak and makes rate changes easier to apply. Save the version used for approval so the final payment can be compared with the budget rather than silently replacing it.
Use the budget resource in a hiring approval
The worksheet below gives finance and HR a shared record. Its useful output is a dated estimate with named assumptions and exclusions. Recheck current official charges and exemptions immediately before assignment. A precise-looking spreadsheet based on an unverified exemption is still an unreliable budget.
Worked review: three hires with different cash profiles
An illustrative small sponsor plans three hires in the same quarter. Finance budgets one average amount per hire. The actual pipeline includes different sponsorship periods, one possible exemption and a licence application that is a business-level cost rather than a per-person charge.
The revised model separates the licence, each CoS and each ISC calculation. The possible exemption remains unconfirmed until the relevant evidence is reviewed. Finance reserves the full expected cash need and records any potential refund as a separate scenario. Recruitment can then see which assignment dates create the largest outflow.
The policy also separates employer-paid charges from optional support for personal application costs. It does not describe the whole amount as recoverable from a worker. Any repayment terms are reviewed on an itemised basis before being offered.
Questions for budget approval
- Is the sponsor category supported by current finance information?
- Are duration and exemption assumptions documented for each hire?
- Which charges are payable upfront, and when?
- Does the contract policy distinguish costs with different recovery rules?
When the actual assignment occurs, reconcile the payment with the approved estimate and preserve both. A rate change or different duration then has a visible explanation. Do not silently edit the forecast until it looks as though the original budget was always exact.
Sources and review date
Official rules and guidance checked on 15 October 2026. Recheck the linked page before making an application or financial commitment.
This article provides general editorial information. A regulated immigration adviser can assess how the rules apply to your circumstances.
A useful next step
Use the Employer sponsorship cost model to turn this guide into a working plan. Continue with Choosing an occupation code: document the duties before the threshold when you are ready to organise the next part of the file.