Can a sponsor make a Skilled Worker repay visa and sponsorship costs?

01 · Cost classification

Start with the individual charge, not the total recruitment spend.

The phrase visa costs often combines fundamentally different items. A sponsor licence application fee relates to the organisation's permission to sponsor. A Certificate of Sponsorship fee is paid for assigning sponsorship to a worker. The Immigration Skills Charge is a statutory charge on certain sponsorship decisions. The visa application fee and Immigration Health Charge belong to the applicant's immigration application, even where the employer chooses to fund them.

Legal fees, priority service charges, travel, relocation and temporary accommodation create further categories. Some may be incurred for the sponsor's regulatory work, some for the individual's application and some for ordinary mobility support. The description used in an offer letter or invoice is not conclusive if the substance is different.

A single clawback amount prevents the sponsor from showing that prohibited charges were excluded. It can also conceal a payment that must be subtracted when the worker's salary is assessed. The underlying invoice, payer, beneficiary and purpose should be preserved for every item.

02 · Sponsor prohibitions

The CoS fee, sponsor licence fee and Immigration Skills Charge require separate treatment.

Sponsor guidance states that the sponsor is responsible for the CoS fee. For a Skilled Worker CoS assigned on or after 31 December 2024, the sponsor must not recoup, or attempt to recoup by any means, any part of that fee or its associated administrative costs from the worker. The guidance states that the Home Office will normally revoke the licence if it finds that this has occurred.

The Immigration Skills Charge is more absolute in its allocation. The sponsor must not pass any part of it to a sponsored worker or attempt to recover it. The charge should therefore not appear in a repayment schedule, whether recovery is immediate, deferred until resignation or described as part of a general mobility loan.

The sponsor licence fee and associated administrative costs are also protected. The current revocation grounds cover asking a sponsored worker to pay, or recovering or attempting to recover, those costs. For Skilled Workers the relevant recovery rule applies where recovery or attempted recovery occurs on or after 31 December 2024. That focus on recovery means an older contract should not be assumed safe merely because it was signed before the rule changed.

03 · Applicant costs

Visa fees and the Immigration Health Charge are not the same as sponsor charges, but recovery is not automatically neutral.

The sponsor guidance prohibitions should not be extended imprecisely to every cost of the worker's application. An employer may decide to fund an application fee, Immigration Health Charge, priority service or individual advice. Whether a later repayment can be required depends upon the contract, the reason employment ended, employment law controls and the immigration salary consequences.

Appendix Skilled Worker excludes payments relating to immigration costs from the salary that can be counted. It also requires payments by the applicant to the sponsor or a related organisation to be subtracted where they concern business costs, immigration costs or investment. A repayment may therefore be contractually framed as repayment of an advance yet still reduce the salary recognised for the route.

The salary effect is averaged across the period of sponsorship under SW 14.2A. This can be material where the role was sponsored close to the applicable general or going rate threshold. A repayment taken over a shorter payroll period may create an acute cash impact, but the immigration calculation must still be performed under the Rule rather than inferred from the worker's net pay in 1 month.

04 · Skilled Worker salary

Recalculate the immigration salary before the repayment obligation is agreed or enforced.

The gross salary in the employment contract is not always the salary recognised by Appendix Skilled Worker. The Rules exclude allowances, benefits in kind, bonuses, immigration payments and business expenses, then address worker payments to the sponsor or a related organisation. The correct analysis starts with guaranteed basic gross pay and applies each exclusion and subtraction.

The sponsor should identify the full sponsorship period, the total payment that falls within SW 14.2A, the applicable salary option, the general threshold and the pro-rated occupation going rate. If the recognised salary falls below any required figure, the arrangement cannot be treated as a private payroll matter.

A genuine optional salary sacrifice arrangement for an additional benefit is treated differently where the worker has a real choice and the payment is not related to business costs, immigration costs or investment. That exception should not be used to relabel a mandatory immigration repayment. The evidence must show a genuine benefit choice in substance.

05 · Employment terms

A permitted cost still requires a proportionate and lawfully operated clause.

Immigration permission does not decide whether an employer can deduct money from wages or recover it after termination. The clause must be incorporated into the contract, sufficiently clear and operated consistently with employment legislation, National Minimum Wage rules and any relevant common law restriction. Employment advice may be required, particularly for substantial sums or deductions from final pay.

The commercial structure should distinguish resignation, dismissal for conduct, redundancy, capability, sponsor driven termination and circumstances in which the worker cannot continue because the sponsor loses its licence or the immigration application is refused. A clause requiring the same repayment in every case may be difficult to justify and may produce an outcome the sponsor did not intend.

A reducing scale can address retention without disguising prohibited sponsor costs. Even then, the sponsor must retest salary and deduction consequences at the point of enforcement. A contract drafted correctly at recruitment can become problematic after a salary reduction, change in hours, extension application or amendment to the Rules.

06 · Existing agreements

Legacy clauses should be audited before the next resignation or compliance visit.

Many employers adopted broad immigration repayment agreements before the sponsor guidance changed. Those documents may combine the Immigration Skills Charge, CoS fee, sponsor licence expenditure and applicant costs in 1 schedule. Continuing to hold the clause is not the same as enforcing it, but a demand, payroll deduction or settlement negotiation can create a current recovery issue.

The audit should identify the CoS assignment date, the date and method of every recovery, the worker's sponsorship period and salary, and whether any related organisation received the payment. It should also review standard offer letters, side letters, loan agreements, relocation policies, payroll codes and exit checklists. Removing a prohibited item from the main contract is ineffective if finance recovers it through another process.

Where a prohibited sum has already been recovered, the sponsor needs a controlled remediation decision. That may include stopping further deductions, calculating repayment, correcting internal documents, assessing whether any sponsor report or wider disclosure is required and preserving an accurate record of what happened. Remediation should not be improvised in anticipation of a Home Office visit.

07 · Governance

Ownership should sit across immigration, employment, HR and payroll rather than with recruitment alone.

Recruitment may agree the package, immigration may assign the CoS, finance may pay the charges, HR may hold the clause and payroll may enforce it. Sponsor risk arises when each team sees only its own step. A single cost schedule and approval control should connect the entire sequence.

Before a sponsored offer is issued, the business should classify every proposed cost, confirm which sums it will bear, calculate the immigration salary after any relevant subtraction and obtain employment input on the remaining clause. Before any deduction or demand is made, the same questions should be repeated against the current Rules, guidance and salary.

This is not simply a drafting exercise. A sponsor that attempts to recover a prohibited charge can expose the licence on which the affected worker and the wider sponsored population depend. The control should therefore be treated as part of sponsor governance, not as an optional mobility benefit policy.

Practical questions.