Unlike before, small businesses are now showing more interest in sponsor license application because of the difficulty they face in finding certain skilled laborers locally. For instance, there is high demand for individuals with digital skills which most talent in local workforce lack.
Another reason is for the skills shortage is the Brexit which made most European workers return to their home countries. Now small businesses need the UK Sponsor License more than ever to hire skilled workers from outside the UK.
If you have a small business and you are wondering how a sponsor license can make your business grow, then you have to read this article. Here, you will learn how to expand your workforce and increase productivity using a sponsor license.
You will also learn the requirements you need to get a UK sponsor license as a small business and step-by-step application process for a sponsor license.
The Talent Gap and Small Business Challenges
As the UK economy keeps lacking qualified personnel in the workforce, it makes it harder for small businesses to reduce their workload hence affecting overall productivity. Also, the market demands is tilting towards the digital aspect, and where a business can’t meet such demands, it can hinder growth and productivity.
In case you are wondering why small businesses can’t just make do with what they have – i.e., why small businesses can’t just hire the local talent they have access to. The reasons include:
It limits their candidate pool living in that locality. So whether they have the skills you need or not, you just have to employ them and either spend resources to train them to your standards or hope for the best.
Imagine a situation where the local talent are not well-traveled, so the ideas they have about your industry is only what they learnt from social media – it limits the innovation and creativity your company needs.
Also, most small business owners complain that competition for available talent makes the cost of hiring unreasonably high. It will not be possible for them to compete with larger companies that can pay the going rate for certain skills, hence, it is ideal to opt for sponsored workers.
If the choice is narrowed down, they either hire available local talent at increased cost and narrowed creativity or they higher sponsor workers at affordable rates who will bring in creativity, innovation, and diverse cultural and professional backgrounds.
If you were a small business owner in the UK, it is very obvious at this point, what your choice would be.
What is a Sponsor License and How Does it Work?
Usually, when a company in the UK needs to legally hire a foreign worker under the Skilled Worker route or other relevant visa routes, they need to offer the employee a Certificate of Sponsorship (CoS) which will allow him/her to apply for the appropriate visa.
However, to offer the CoS, the company needs to obtain a Sponsor License from the UK Visas and Immigration (UKVI). The company can either get a worker license (to sponsor people in different types of skilled employment) or a temporary worker license (for specific temporary roles).
Usually, sponsor licenses require renewal after four years, however, after April 2024, they can now be extended for up to 10 years.
Basic Requirements and Eligibility Criteria for Getting a UK Sponsor License for Small Business Owners
You must be running a legitimate business.
Your business must be physically and legally operating your business in the UK – i.e., your business must be registered with the Companies House.
You must have an HR system in place.
Clean criminal record.
Must appoint a qualified staff to handle the sponsorship process.
Must comply with UK employment laws.
Must meet the financial requirement of 10.2 million annual turnover and 5.1 million total assets.
Must employ only 50 workers or less.
Benefits of a Sponsor License for Small Businesses
With a sponsor license, small businesses can hire workers/professionals with specific skills that may not be available locally. Most especially startups in tech industry or companies/hospitals in healthcare sector will benefit from owning a sponsor license.
With diverse team, small businesses can troubleshoot faster and access different levels of creativity. For example, you may not understand the importance of cultural perspectives until you need to push your product to Nigerian audience and you don’t have a Nigerian on your team, etc.
If businesses are able to fill key roles that they’re not able to fill locally with foreign workers who possess the needed in-demand skills, they will experience long-lasting business success.
Step-by-Step Sponsor License Application Process 2025
The following steps will guide you as you begin your application process for a UK sponsor license visa:
Check if your business meets the eligibility criteria.
Identify the type of workers you need to fill the skill gap – could be a scale-up worker or a skilled worker.
Appoint key personnel
Gather the required documents
Complete the online form
Submit the application and documents demanded to support your application
Pay application fee of 574
Prepare your HR systems and records for a compliance visit.
Wait for the Home Office’s decision.
There are two types of documents a small business owner must submit to the Home Office – mandatory and supporting documents. Mandatory documents a.k.a. Appendix A demonstrates the eligibility of the company while supporting documents proves the organization’s legal and financial status.
Mandatory documents you must submit include:
- HMRC registration evidence
- Commercial lease
- The owner’s liability insurance certificate
- Certificate of VAT registration
- Recent bank statement of your corporate account
- Latest audited annual accounts
For supporting documents, small businesses must submit the following:
- A cover letter – explaining why they are applying, which industry they operate in, their work hours, hierarchy chart of owners, directors and board members, your official telephone number, and a list of names and job titles of all employees.
- The SOC code
- Proper job description
- Qualifications and skills required for the job role.
- Guaranteed salary
Now, you wouldn’t want your application to be rejected after spending so much money, hence it is advisable that you thoroughly prepare and ensure that the above documents are accurate.
Review and audit every information you’ve submitted to ensure that it is in tune with the Home Office’s latest requirement.
