Key Highlights
Salary Threshold Reforms
The government announced that from spring 2027, occupation-specific salary thresholds will be reviewed and reduced from the median to the 25th percentile in line with recommendations made by the Migration Advisory Committee (MAC). However, the general salary threshold is expected to increase in line with 2026 wage data. Other changes include simplifying the new entrant salary discount framework and removing the salary concession currently available to PhD holders.
While some sectors facing recruitment challenges may benefit from lower occupation-specific thresholds, sponsors may wish to avoid assuming that the measures would result in an overall reduction in sponsorship costs given anticipated increases to the general salary floor.
Extended Curtailment Period for Highly Skilled Workers
The government plans to introduce an extended visa curtailment period of up to six months for highly skilled sponsored workers following the loss of their employment or sponsorship. This would replace the current 60-day period for eligible individuals.
The change is intended to provide greater flexibility for both employers and workers by allowing more time to secure alternative sponsorship arrangements within the UK.
Immigration Skills Charge and Certificate of Sponsorship Fee Tax Clarification
The government has announced that legislation is expected to be introduced through the Finance Bill 2026-27 to confirm that Immigration Skills Charge (ISC) and Certificate of Sponsorship (CoS) fees will not be treated as taxable benefits in kind.
This clarification could address uncertainty for employers regarding the tax treatment of sponsorship-related costs and will be welcomed by organisations sponsoring overseas workers.
Graduate Visa Changes
The government has partially reversed its previously announced reduction to the Graduate route. Graduates from universities classified as “high compliance universities,” for which strong labour market outcomes can be demonstrated will remain eligible for a two-year Graduate visa.
This concession could provide additional flexibility for employers recruiting international graduates already present in the UK and could benefit universities with strong compliance records. The change may be welcomed by both universities and international students, given that the availability of a two-year post-study work visa has been an important consideration for students when choosing where to pursue their studies.
Expansion of the High Potential Individual Route
The government plans to expand the High Potential Individual (HPI) visa route by increasing the number of eligible institutions from 80 to 150 of the world's recognised universities. A proportional increase to the route's cap is also expected.
This expansion could enable a broader pool of recent graduates from internationally recognised institutions to live and work in the UK without requiring employer sponsorship, potentially increasing access to highly skilled global talent for UK employers.
