Budget 2026: what the immigration changes mean for UK sponsors

The 28 October 2026 Budget promises to rewrite how Skilled Worker salaries are set, and for a lot of sponsors the minimum they pay won't fall. From spring 2027, going rates drop from the median wage to the 25th percentile, but the £41,700 general threshold is being uprated on 2026 wage data at the same time.

The Budget also brings a longer job-hunting window for the highest skilled sponsored workers, a tax fix on the Immigration Skills Charge and Certificate of Sponsorship fees, reform of non-compete clauses, and a 3.9% rise in the National Living Wage. Here's what each change means for employers who sponsor, and which parts are actually in force.

One thing first: almost none of this is law yet. The Budget is a statement of what the government intends to do. The salary and curtailment changes need new Immigration Rules, which haven't been laid. Until they are, today's thresholds decide today's Certificates of Sponsorship.

Skilled Worker salary thresholds: lower going rates, a higher general floor

The government says it will implement the Migration Advisory Committee's (MAC) recommendations on visa salary requirements from spring 2027. The MAC is the independent body that advises the Home Office on work immigration; it published its salary review in December 2025.

To see who gains and who doesn't, start with how the minimum works today. In most cases, a Skilled Worker must be paid whichever is higher of the general threshold, currently £41,700 a year, and the going rate for their occupation code. Lower thresholds apply in some cases, such as new entrants and jobs on the Immigration Salary List, and the going rate is pro-rated to the hours worked. The going rate is the minimum the Home Office sets for each job type, published in the going rates table.

Who is likely to pay less

Roles where the going rate is higher than the general threshold. That's typically senior and specialist jobs in tech, finance and professional services. Moving their going rate from the median to the 25th percentile lowers the floor, as long as it stays above the new general threshold.

Who is likely to pay more

Roles where the general threshold is already the number that binds. If the going rate for a job sits below £41,700 today, cutting it further changes nothing, and the uprated general threshold becomes the higher figure. For those roles the minimum is likely to rise in spring 2027, then again each year after.

Two groups need extra care. Anyone sponsored using the PhD discount loses it. New entrants (recent graduates, people still studying or in professional training) move to one discount figure, and the Budget doesn't say what it will be. The MAC suggested £33,400, but the government hasn't confirmed that number, so don't plan around it yet.

A specific list of health and education roles uses national pay scales instead of survey data. The Budget doesn't say whether those roles change.

Check where each of your roles sits today. Our Skilled Worker minimum salary calculator shows which number binds for any occupation code, so you can see which side of this change you're on.

Up to six months to find a new sponsor

When sponsorship ends early, the Home Office will usually cancel the worker's permission so they have only a short window left to find a new sponsor, switch route or leave the UK. Where a sponsor's licence is revoked and the worker wasn't involved, that window is normally 60 days. The Budget says the government will work towards giving the highest skilled workers in highly paid jobs a curtailment period of up to six months, with implementation in 2027.

The length will depend on how long the person worked in their previous highly paid role. The Budget doesn't define "highest skilled" or "highly paid", so we don't yet know who qualifies.

For employers, this cuts both ways. If you're hiring, a sponsored professional who has lost their job will have much longer to join you, which makes them a more realistic hire. If you're restructuring, nothing in the Budget changes your reporting duties: you still report the end of sponsorship on the sponsor management system on time.

Sponsorship fees won't count as a taxable benefit

This is the one change with a start date already behind it. The government will legislate in the Finance Bill 2026-27 so that an employer paying the Immigration Skills Charge (ISC) or a Certificate of Sponsorship (CoS) fee is not treated as giving the worker a taxable benefit in kind. It applies to payments made on or after 28 October 2026.

The ISC is the levy sponsors pay per sponsored worker: currently £1,320 for the first 12 months plus £660 for each further six months for medium and large sponsors, or £480 and £240 for small or charitable ones, paid up front for the whole period when you assign the CoS. The CoS fee is £525 per certificate on the Skilled Worker route. Sponsors can't recover either cost from the worker, so the change settles a long-running question about whether paying them could trigger tax for the worker.

It doesn't cover visa application fees or the Immigration Health Surcharge, which employers sometimes pay too. It also doesn't say how payments before 28 October will be treated, and the legislation hasn't passed yet. If you pay sponsorship costs through payroll, it's worth a conversation with your payroll or tax adviser this quarter.

Non-compete clauses: more sponsored professionals free to move

The government will legislate so that non-compete clauses in employment contracts don't stop startups and scaling firms from hiring, or block workers in the everyday economy from moving jobs. The Budget names "tech employees to care workers" as the people affected. It will consult shortly on wider restrictive practices and set out a detailed position in early 2027, before legislating.

This isn't an immigration measure, but it lands on sponsors. When a sponsored worker moves to you, you assign them a new Certificate of Sponsorship and they make a change of employment application. They can't start with you until that application is approved and you've done their right to work checks. Their previous sponsor reports that their sponsorship has ended. Fewer non-competes means more of those moves, in both directions.

If you hire sponsored professionals from competitors, build that switching time into your start dates. If you employ them, a non-compete may not hold them for much longer, so retention has to come from the job itself.

Care providers: two pay floors move in 2027

From 1 April 2027, the National Living Wage rises 3.9% to £13.21 an hour, and the accommodation offset (the amount you can count towards minimum wage when you provide housing) rises to £11.53 a day. The government says that's worth £910 a year to a full-time worker on the National Living Wage.

For care providers, that rise lands in the same planning year as the new salary thresholds. Pay for sponsored care workers already in the UK, and for the domestic team around them, tends to sit close to the wage floor. Sponsored pay is checked continuously, not just at the point of hire: each pay period has to meet the going rate for every hour worked, and the annual salary is tested over rolling periods. So check the sponsored roles on your rota against both numbers when the new figures are published.

The Budget also pushes back the Independent Commission on Adult Social Care, which will now report in 2027, and commits to a National Care Service in England with personal care free at the point of use in the next Parliament. Neither changes sponsorship today, but both shape the funding picture for care employers.

Graduate, High Potential Individual and Global Talent routes

Three changes widen the pool of people who can work in the UK without sponsorship at the start, which matters most for tech and finance employers building graduate pipelines.

• The Graduate visa goes back to two years, from 18 months, for graduates of "high-compliance universities where there are strong labour market outcomes". There's no start date, and no list of qualifying universities yet.
• The High Potential Individual (HPI) visa opens to graduates of the top 150 global institutions, with a proportional increase to the route's cap. There's no start date.
• UKRI will identify more R&D-intensive businesses in Industrial Strategy sectors to act as hosts on the Global Talent visa's endorsed funder pathway, by spring 2027. The Budget says more than 100 have been added since Budget 2025.

None of these routes needs a sponsor licence. But graduates who join you on them often need sponsoring later, when their visa runs out. A longer Graduate visa gives you more time to decide, and to plan the switch onto Skilled Worker around the new salary thresholds.

Every Budget change at a glance

Only the tax change applies from today, and the National Living Wage date is fixed. Everything else waits for new rules or legislation.

What to do now

The headline says salary thresholds are falling. For many sponsors the honest answer is that it depends on the role, and you can work out which way yours go before the rules are published.

1. Map each sponsored role to the number that binds today. Going rate or general threshold. That tells you whether spring 2027 is likely to lower or raise its minimum.
2. Flag anyone on the PhD or new entrant discount. Those workers are most exposed when the discounts change, especially at their next extension.
3. Budget 2027 pay reviews against two floors. The uprated general threshold and, for care, the new National Living Wage.
4. Ask payroll how ISC and CoS payments are treated. Payments from 28 October 2026 shouldn't create a benefit-in-kind charge once the legislation passes.
5. Keep sponsoring under today's rules. Nothing changes for a Certificate of Sponsorship you assign this year.

We'll update this guide when the Statement of Changes is laid and the new figures are confirmed. If you'd rather not track every threshold yourself, book a demo and see how Borderless Immigration keeps your sponsorship compliant, from licence to settled hire. There's too much at stake to find out at your next extension.