What is a sponsor licence in simple terms?

A sponsor licence is a permission from the Home Office that allows a UK employer to hire workers from outside the UK on certain visa routes. Without one, you cannot legally employ someone who needs visa sponsorship to work in the UK.

Does every employer need a sponsor licence?

No. You only need a sponsor licence if you want to hire workers who require visa sponsorship. If all your employees are British citizens, have settled status, or hold visas that allow unrestricted work (such as a spouse visa), you do not need a licence.

How long does a sponsor licence last?

A sponsor licence is valid for up to 4 years from the date it is granted. Before it expires, you must apply to renew it. If you do not renew in time, the licence lapses and you can no longer sponsor workers.

What is the difference between a Worker and Temporary Worker licence?

A Worker licence covers longer-term routes such as the Skilled Worker visa, Senior or Specialist Worker visa, and Minister of Religion visa. A Temporary Worker licence covers shorter-term routes including charity workers, creative workers, and seasonal workers. You can hold both types simultaneously.

Sponsor Licence Explained: What UK Employers Need to Know

A sponsor licence allows UK employers to hire workers from outside the UK on sponsored visa routes. This guide explains the system from scratch — what the licence is, how it works, the different types, and the obligations that come with it.

What a Sponsor Licence Is

A sponsor licence is a permission from the Home Office that allows your organisation to sponsor workers from outside the UK. When someone needs a visa to work in the UK — for example, a Skilled Worker visa — they need an employer who holds a sponsor licence to sponsor them.

Think of it as the employer's side of the work visa system. The worker applies for the visa; the employer provides the sponsorship through the licence. Without a licence, you cannot issue Certificates of Sponsorship and therefore cannot hire anyone who requires sponsorship.

Who Needs a Sponsor Licence

You need a sponsor licence if you want to employ someone who:

Is not a British citizen
Does not have settled status (indefinite leave to remain or EU Settlement Scheme settled status)
Does not hold a visa that already allows them to work without restriction (such as a spouse visa or Graduate visa)

If all your employees already have the right to work in the UK without sponsorship, you do not need a licence. But if you want to recruit internationally — or if a potential employee tells you they need sponsorship — you will need one.

Types of Sponsor Licence

There are two main types of licence:

Worker Licence

This covers longer-term visa routes, including:

Skilled Worker visa
Senior or Specialist Worker visa (Global Business Mobility)
Minister of Religion visa
International Sportsperson visa

Temporary Worker Licence

This covers shorter-term routes, including:

Charity Worker visa
Creative Worker visa
Seasonal Worker visa
Government Authorised Exchange visa

You can hold both types of licence simultaneously. Most employers who sponsor workers hold a Worker licence, as the Skilled Worker visa is the most commonly used route. See the full GOV.UK guide to sponsoring workers for the complete list.

How the System Works

The sponsorship system works in a cycle:

Step 1: The employer applies for and obtains a sponsor licence
Step 2: When the employer wants to hire a specific worker, they assign a Certificate of Sponsorship (CoS) to that worker
Step 3: The worker uses the CoS to apply for their visa
Step 4: Throughout the sponsorship, the employer meets ongoing compliance duties

The employer manages all of this through the Sponsor Management System (SMS), an online portal provided by the Home Office.

What the Home Office Looks For

When assessing a licence application, the Home Office checks that:

The organisation is genuine, operating, and trading (or operating for a genuine purpose if not a business)
The organisation has appropriate HR systems to meet its sponsorship duties
The organisation has not previously had a licence revoked (or has waited the required cooldown period)
Key personnel (Authorising Officer, Key Contact, Level 1 User) pass suitability checks

The Home Office may conduct a pre-licence compliance visit to verify these points. See the full requirements guide for details.

Licence Ratings

Once granted, your licence is rated A or B:

A-rated: You are fully compliant. You can assign CoS and sponsor workers without restriction.
B-rated: The Home Office has identified compliance issues. You must complete an action plan to return to A-rating. While B-rated, you may face restrictions on sponsoring new workers.

All new licences start at A-rating. A downgrade to B happens when the Home Office finds compliance failures during a visit or audit. See our guide on action plans for how to respond.

Costs at a Glance

The key costs are:

Licence application: £536 (small/charity) or £1,476 (medium/large)
CoS fee: £525 per worker
Immigration Skills Charge: £364/year (small) or £1,000/year (medium/large) per worker

See our detailed sponsor licence cost guide for the complete breakdown, including worker-side costs.

Common Misconceptions

"We are too small to sponsor." There is no minimum company size. Sole traders, startups, and small businesses can all hold a licence.
"We need to prove we could not find a UK worker." The old Resident Labour Market Test was abolished. There is no requirement to advertise to UK workers first.
"The licence covers a specific worker." The licence covers the employer, not any individual worker. Once you have a licence, you can sponsor as many workers as your CoS allocation allows.

Next Steps

If you are considering applying for a sponsor licence, start by checking the requirements and reviewing the GOV.UK application process. Ensure your HR systems are ready for the compliance duties before you apply.

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