Contributors
What is the change?
The definition of "small" or "large" company comes from the Companies Act 2006 and this is the definition that the Home Office relies on when classifying a sponsor's size. The definition was updated in the Companies Act on 6 April 2025. To qualify as a "small" company now, two out of the three criteria below must be met in the same financial year. The company needs to have:
- No more than 50 employees (this is unchanged)
- A turnover of not more than £15 million (this has increased from £10.2 million)
- A balance sheet total of not more than £7.5 million (this has increased from £5.1 million).
What does this mean?
The Home Office sets the fees associated with visa sponsorship by reference to a company’s size. The benefit of being classed as a "small" sponsor is that the sponsor pays lower fees for sponsor licence applications, and a lower Immigration Skills Charge payment when sponsoring Skilled Worker and Senior/Specialist workers under the Global Business Mobility route.
This means that some sponsors that were previously classified as large may now be classified as small, and be able to benefit from lower fees.
What do sponsors need to do?
Sponsors are expected to comply with their sponsor duties by keeping the Home Office updated of any changes to the sponsor's organisation (including its size). You should assess your organisation's position against the new thresholds set out above to decide whether the changes impact the size classification of your company.
If, as a result of this change, your company's size classification has changed, you must notify the Home Office within 20 working days through your sponsor management system (SMS). You may be required to provide supporting evidence, such as company accounts or a staff hierarchy chart. If a sponsor fails to comply with its reporting duties, the Home Office can take action against the sponsor licence (including downgrade, suspension and revocation). It is therefore important that you report the change (if required) in the SMS within 20 working days.
How we can help
Our team of immigration lawyers can help navigate you through this change, and also assist you with, and advise you on, sponsor licence management, compliance and reporting duties.
Please get in touch with Paige and Katie in our immigration team.
This article is for general information only and reflects the position at the date of publication. It does not constitute legal advice.
