Immigration health surcharge to double

IMPACT – HIGH

What is the change? The immigration health surcharge required of non-EEA nationals is set to double from £200 to £400 per year (£150 to £300 per year for students and Youth Mobility Scheme applicants).

What does the change mean? Employers, non-EEA nationals and their family members intending to stay in the U.K. for longer than six months should budget for the sharp increase. The surcharge must be paid up front and in full for each individual and for the full term of the visa at the time of application.

• Implementation time frame: Jan. 8.
• Visas/permits affected: All visa applications for work, study or joining family for stays longer than six months in the U.K.
• Business impact: Companies should prepare for the increased costs. Employers who pay the surcharge will not be reimbursed if the employment relationship ends before the full term.

Background: The immigration health surcharge, which was introduced in April 2015, requires non-EEA nationals to contribute to their use of the National Health Service while in the U.K. The surcharge was expanded to include Australia and New Zealand in April 2016 and to the Tier 2 (Intra-Company Transfers) subcategory in April 2017.

A government review found that doubling the surcharge could generate an additional £220 million per year for the NHS, and in early 2018 the government announced plans to implement the increase by the end of the year.

Analysis & Comments: The immigration health surcharge is a significant upfront cost for companies recruiting non-EEA workers and its doubling will be felt by business. Companies should budget for the additional costs associated with hiring and retaining foreign workers.

Source: Deloitte LLP. Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at 1 New Street Square, London EC4A 3HQ, United Kingdom.