Sponsor Licence Applications for Start-ups: Frequently Asked Questions
This article will provide guidance for Start-up businesses that wish to apply for a Skilled Worker Sponsor Licence from the Home Office. Full details of the eligibility and suitability criteria for a Skilled Worker Sponsor Licence are discussed in our previous post How To Apply For a Skilled Worker Sponsor Licence.
What type of organisation can be considered as a Start-up business?
In accordance with the Home Office’s Appendix A, an organisation can be considered as a start-up: ‘If you have been operating or trading in the UK for less than 18 months on the date you make your application, the checks we will make are different to those we carry out on more established businesses.’
What documents does a Start-up business need to provide?
Start-up businesses usually needs to provide at least 4 documents. If an organisation can provide more than 4 documents, it is encouraged to do so.
Mandatory documents
As a start-up, it is essential that evidence is shown that the company has a bank account. The bank must be registered by the Financial Conduct Authority and the Prudential Regulation Authority in the UK. You can provide a letter from the bank setting out the dealings it has had with you. Alternatively, you can also provide the most recent bank statements showing transactions. If both documents are provided, it will only be counted as one document.
Other documents
The Home Office understands that as a start-up, there are various documents which may not be available. The following are suggestions for documents that may be easier to provide:
- VAT registration certificate from HM Revenue & Customs (‘HMRC’);
- Letter from HMRC confirming your PAYE reference number and Accounts Office reference number;
- Employer’s liability insurance cover for at least £5m from an authorised insurer registered with the Financial Conduct Authority;
- Lease for the business premises;
Other documents which can be provided, if these are available, include:
- Latest audited or unaudited annual accounts where the name of the accountant is stated. Do check that the accountant is a member of an accredited accounting body;
- Latest completed Company Tax Return CT600 and the CT603 notice;
Any other mandatory documents?
Franchise: If you are a franchise, it is vital that you provide a copy of the franchise agreement. This must be signed by both parties.
Food business: If you are in the food business and you are required to register with a food authority, evidence must show that your business has obtained registration or approval. This can include evidence from Scores on the Doors or a letter from the relevant authority confirming registration or approval.
It is worth noting that if your business also serves alcohol, you should have a licence issued by the local authority or court granting your business permission to serve alcohol. This can be counted as one document towards your 4 documents.
Businesses which are required to register with a regulated body: The Home Office has set out in Appendix A what they expect to see for the following businesses:
- “nursing/care homes and other businesses, which must be inspected by Ofsted or the Care Quality Commission or the equivalent bodies in Scotland, Wales and Northern Ireland
- financial or insurance businesses carrying out regulated activities which must be registered with the Financial Conduct Authority or the Prudential Regulation Authority
- healthcare and medical providers, who must be registered with the General Medical Council or General Dental Council
This is not an exhaustive list.”
Most of the checks can be carried out online unless you are applying for a licence under a different name, then the last inspection report can be submitted.
Charity: An online check can be conducted if the business is registered with the Charity Commission for England and Wales, the Charity Commission for Northern Ireland or the Scottish Charity Regulator.
What are the Sponsor duties?
There have been recent changes to sponsor duties introduced on 09 November 2022 as discussed in Sponsor Licence Holders – Latest Changes to Sponsor Duties.
A summary of the Sponsor Licence Duties: A Checklist for Employers includes:
- Reporting duties – sponsor licence holders must report certain information or events to the Home Office using the SMS within time limits;
- Record-keeping duties – sponsors must keep certain documents for each worker you sponsor;
- Complying with immigration laws and all parts of the Worker and Temporary Worker sponsorship guidance;
- Complying with wider UK law – this includes national minimum wage and paid holiday entitlement;
- Not engaging in behaviour or actions that are non-conducive to the public good;
If you fail to understand and comply with your duties as a sponsor, you risk the licence being revoked or suspended and the workers who are being sponsored by you may have their visas affected. If your licence is suspended, you will not be able to assign any Certificate of Sponsorship. We set out what will happen in our articles Sponsor Licence Suspended – What To Do Now and Sponsor Licence Suspended – What’s Next?.
Who can be the Key Personnel?
When applying for a sponsor licence, one of the first steps is to know who will undertake the key personnel roles. The organisation will need an Authorising Officer and the person who undertakes this role must be the most senior person in the organisation who is involved in recruitment and is responsible for the activities of all SMS users. Then a Key Contact (main point of contact with the Home Office for any queries) and a Level 1 User (responsible for day-to-day management of the licence and who will access the SMS) will also need to be appointed. These 3 roles can be undertaken by the same person. For more information, please read our post here. Once the licence has been approved, level 2 users can be appointed.
How will the Home Office assess the sponsor licence application?
The Home Office will check the following when assessing your start-up sponsor licence application:
- Whether there is a human resource system in place to meet your sponsor duties;
- Whether they are able to conduct an immediate and unannounced compliance check to ensure sponsor duties are being complied with;
- Whether there is any evidence of previous non-compliance by you;
- Whether your organisation is able to offer the genuine employment;
- That the job meets the correct skilled level and salary requirements as set out in the Immigration Rules;
- Whether any of the key personnel within the business have an unspent criminal convictions for a relevant offence;
The standard processing time for skilled worker sponsor licence applications is up to 8 weeks. For the application to be processed within 10 working days, a priority service for a fee of £500.00 may be available.
Contact Our Immigration Barristers
For expert advice and assistance in relation to a Sponsor Licence application or a Skilled Worker application, contact our immigration barristers in London on 0203 617 9173 or via the enquiry form below.
