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Tier 2 Sponsor Licence Renewal

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For many companies, the Tier 2 sponsor licence renewal application is a more demanding and involved process than the initial licence application.

Preparation will be key. Your organisation should undertake proactive steps to ensure readiness for this process and the potential scrutiny which may result from the Home Office as to your organisation’s continued compliance with the regulations. In addition, as part of the licence extension process, the UKVI reserves a right to undertake a compliance visit to sponsor companies and request corporate documentation as deemed necessary.


Why the Tier 2 sponsor licence renewal matters

Under the Points Based System (PBS) UK employers have to be licensed by UK Visa and Immigration (UKVI) before they can employ non-EEA workers.

From 1 January 2021, EU workers coming to the UK will also need to be sponsored under the skilled worker route.

Sponsor licences are granted for an initial period of four years. To continue to employ PBS workers lawfully beyond this four-year period, you will need to apply to renew your sponsor licence ahead of licence expiry.

Correctly applying to renew your organisation’s sponsor licence is crucial for business operations, and retaining position on the register of sponsors and permission to continue to sponsor migrant workers.

A refused renewal application can have devastating effects on a business and its PBS workers. Without a lawful sponsor, PBS workers will see their leave curtailed unless they can find qualifying employment before their curtailed leave expires.

If the business does the lose out on PBS workers, they will have to look at recruiting again, which can be problematic in sectors where skills shortages prevail.

Common reasons for Tier 2 licence refusal include:

  • Failure to pass a UKVI compliance audit – your organisation will be evaluated against the legal requirements under the sponsor licence.
  • Failure to have retained the required documentation on sponsored migrants – record-keeping duties are strict and ongoing.
  • Failure to have advised UKVI of significant changes to company structure and personnel – strict timescales apply when notifying of organisational changes.
  • Failing to respond to UKVI’s enquiries in a timely manner – engaging with the Home Office will help your cause.
  • Failure to pass the ‘genuineness test’ – if the role is perceived not to be a genuine vacancy requiring an overseas skilled worker.
  • Failure to comply with UKVI security standards


Tier 2 sponsor licence renewal process

Sponsors are able to apply for their renewal up to 3 months before the expiry date. The licence expiry date is stated on the summary page of your Sponsor Management System (SMS). UKVI issue reminders of the expiry via the SMS, so it is important to check the contact details on the licence are up to date to ensure the prompts are received.

In any event, we advise making the application as soon as possible to allow time to deal with any potential issues while your current licence remains valid.

You should ensure that licence management to date has been compliant. An audit of your organisation’s compliance with its sponsorship duties can be used to identify areas of risk and confirm areas of compliance. Look specifically at key duties such as maintenance of records for migrant workers, carrying out necessary compliance checks on your staff and timely reporting of all necessary changes in migrant activities to UKVI.

Companies submit their Tier 2 licence renewal application via the online Sponsor Management System (SMS). First check that all of the information on the SMS is correct and all reports are up to date. Any errors or updates will need to be reported before the extension application is submitted. Also conduct a review of the relevant documentation under Appendix A of the Sponsor Guidance. While the Home Office will conduct checks online and cross-reference with other available data sources, it is still common for requests to be sent to sponsors for additional information or documentation. Such requests should be responded to within 5 days to avoid enforcement action, as such it is good practice to have documents in order in preparation.

The nominated Level 1 User will be required to complete a sponsor declaration and pay the relevant application fee:

Type of licence Fee for small or charitable sponsors Fee for medium or large sponsors
Tier 2 £536 £1,476
Tier 5 £536 £536
Tier 2 & Tier 5 £536 £1,476


Once submitted, the application will be assessed against the Home Office criteria requiring the sponsor to be operating legally in the UK, still suitable to be a licensed sponsor and able to meet their duties at the levels expected. The organisation’s certificates of sponsorships will also be reviewed in light of the licence and how they have been assigned to PBS visa workers.


Preparing for a Home Office inspection

Renewal applications commonly trigger a Home Office site visit. This is fairly routine and employers should take steps when preparing their renewal application to ensure they are ‘match-fit’ for a site inspection should this be requested.

During the visit, Home Office officials will look to assess whether your organisation is complying with its duties under the licence, for example in respect of record keeping, key personnel appointments and migrant workers. They will ask to see relevant employee records and documentation and may also ask to speak with relevant members of staff.

Issues or breaches identified during the inspection can result in refusal of your renewal application, so it pays to be well prepared.


What if your Tier 2 sponsor licence has expired?

Licences can be left to expire for many reasons – perhaps there has been a change in personnel responsible for the licence, or there has been a failure or oversight in updating the SMS contact details and the expiry reminders have not been received by the correct person. In practice, the issue often only comes to the employer’s attention when a PBS worker applies to the Home Office for ILR, and the out of date licence is then flagged.

If you become aware that your licence has expired, you will need to take swift corrective action to try to retain your ability to lawfully hire PBS workers.

This may require a new application to be made for a new sponsor licence, or you may be able to apply for reinstatement by the Home Office. Taking immediate advice on your options can help to rectify the situation and help mitigate further compliance risks.


Need help with a renewing your sponsor licence?

DavidsonMorris are recognised experts in licence renewal applications, offering a complete Tier 2 licence renewal application service which includes assisting with initial considerations as to the type of sponsorship application and suitable key personnel, helping you to collate the appropriate supporting documentation and auditing your HR systems and procedures to get them in order before the UKVI visit

We have particular experience and success with complex renewal applications, such as expired licences and where there have been compliance breaches or previous Home Office enforcement action.

For specialist advice on your Tier 2 sponsor licence renewal,  contact us.


Tier 2 sponsor licence renewal FAQs

How long does a sponsor licence last?

A sponsor licence is granted for a period of four years. To retain your status as a sponsor licence holder and your permission to employ Tier 2 visa workers, you will need to apply to renew your licence in advance of its expiry.

What happens during a Home Office inspection?

It is common for the Home Office to visit licence holder’s premises following receipt of the licence renewal application. The purpose of the inspection is to confirm that the organisation has acted in accordance with its compliance duties for the duration of the licence, such as maintaining effective records and active monitoring of visa workers’ activities, and has the infrastructure in place to continue to be compliant should the licence be renewed. If the inspecting officer is not satisfied that the standards have been met, they can refuse the renewal application.

What happens if the sponsor licence has expired?

If the sponsor licence expires and is not renewed past the four-year validity, the employer no longer has permission to lawfully employ points-based visa workers. Any sponsored workers will see their certificate of sponsorship cancelled. Their leave to remain will be curtailed to 60 days or the time remaining on their visa if under 60 days. During this period, they will have to leave their job and apply for a new visa or leave the country.

How can DavidsonMorris help?

Our team of UK immigration specialists is well versed in all the document and evidentiary requirements that can be vital to a prompt and successful renewal application. We can assist with auditing and preparing for the application, implementing any necessary changes to ensure compliance and compiling the documentation.

Last updated: 8th August 2020

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