Q&A: Immigration fees in the UK

by Ben Brindle

In October 2023, the Home Office increased the fees for various immigration and nationality applications. The Immigration Health Surcharge (IHS) was increased in February 2024. These were the latest in a series of increases since the charges were introduced.

This commentary answers some common questions about immigration charges and their implications:

• What fees do migrants pay?
• How much are they?
• How are migrants affected?
• What is the rationale behind immigration charges?
• When were they introduced, and how much have they increased?
• How does the Home Office set application fee levels?

What fees do migrants pay in the UK?

Migrants applying for UK visas must usually pay fees. The main costs include:

• Visa application fees, which vary depending on the application type (work, family, or study)
• In-country application fees, if they extend their visas (often after around 2.5 years)
• The Immigration Health Surcharge (IHS) for each year that the person and their partner or children will hold a temporary visa
• Settlement and citizenship fees

Migrants pay both charges at the point they apply for their visa, and only the IHS is refunded if the application is refused. Both main applicants and any dependants face these charges.

Some immigration applications are free. In particular, there is no charge for the EU Settlement Scheme or for seeking asylum.

Some fee exemptions also exist. For example, migrants applying to work in the health and care sector do not pay the NHS surcharge. Some family migrants can apply for a fee waiver if they cannot afford the application fee or IHS for temporary visas.

Employers hiring migrants on Skilled Worker visas also pay a separate fee, the Immigration Skills Charge. The charge was introduced to incentivise UK employers to train domestic workers. This cost cannot legally be passed onto migrant workers and is not discussed further in this briefing.

How much are the charges?

Fee levels vary depending on the type of visa and whether any family members are included. For example, in early 2024, a study visa cost £490, compared to £2,885 for settlement (also known as indefinite leave to remain or ILR). These figures do not include the additional cost of the IHS for temporary visas, which stood at £1,035 per person a year (or £776 for students and children) in April 2024.

The total amount migrants pay during their stay in the UK is often higher than this because migrants will often need to make several applications. Dependants are required to pay fees too. A family of four, for example, would pay the relevant application fee four times.

Figure 1 shows the cumulative amount an individual or family will pay in immigration fees depending on their visa route and length of stay in the UK. Health and Care workers face the lowest cost from entry to citizenship (just under £5,100), because they do not have to pay the health surcharge. Outside of health and care, the total cost from entry to citizenship ranges from just over £11,200 for a Skilled Work visa holder with no family, to around £38,000 for a parent and child on a ten-year route to settlement. A skilled worker with a partner and two children would pay around £41,500 in total.

Note that the immigration charges paid by students will only be displayed if the filter “Dependants” is set to “No dependants”.

Figure 1

What is the rationale for immigration charges?

Until 2003, application fees only covered the administrative cost of processing immigration applications. Since 2004, however, the Home Office has been permitted to set fees higher, using the additional revenue to subsidise the UK’s wider immigration system.

In 2022/23, the Home Office’s visa and immigration income, which included revenue from visitor visas, totalled £2.2 billion. This was equivalent to 29% of the department’s spending on the immigration, asylum and border system in the same year: £7.5 billion. Among the wider activities funded partly by fee revenues are enforcement operations and refugee resettlement programmes.

Fee increases have also been linked to Home Office spending that is unrelated to migration. For example, the government suggested that the October 2023 application fee increase would indirectly help to fund a pay rise for the police. This was on because higher fees would reduce the extent to which tax revenue was required to fund immigration activities, allowing the tax revenue to be redirected elsewhere.

Income raised by IHS is used to fund healthcare in the UK, with the rate set according to the estimated average cost of providing NHS services to migrants who face the surcharge. In 2022/23, IHS payments totalled over £1.7 billion. Note, however, that most migrants will also pay for the NHS in the same way as UK citizens: through their taxes. The IHS thus represents a form of double taxation – migrants who are net fiscal contributors to the UK’s public finances pay twice.

How do the charges affect migrants?

While there is limited available evidence on the impact of application fees and IHS, surveys conducted by charities have indicated that migrants living in the UK can incur financial hardship to meet payments (Migrant Voice, 2022; Mort et al., 2023). Some respondents reported difficulty building up savings, whereas others borrowed money to pay fees and IHS—most commonly from family and friends. Respondents also noted a negative impact on their health and wellbeing, citing the uncertainty created by the requirement to pay fees at each visa renewal to maintain legal status in the UK.

Certain family migrants can have immigration charges waived if they cannot afford them. The Home Office predicted that the proportion of family migrants receiving a fee waiver would increase due to the IHS rate rise in February 2024—its impact assessment (IA) of the change estimated that just over half of eligible applications submitted between 2023/24 and 2028/29 would receive a fee waiver, compared to 35% before the increase. According to the IA, the number of fee waivers granted would be around 60,000 each year.

Advocacy groups have also argued that higher immigration charges could increase labour exploitation. This is because migrants will arrive in more debt, and debt increases their reliance on their work (and their employer), creating a larger power imbalance. Exploitation is more common in lower-paying roles – such as in the care sector – or in cases where migrants pay large recruitment fees while they are being recruited from outside the UK.

When were charges introduced, and how much have they increased?

Fees for entry visa and citizenship applications date back several decades, whereas in-country visa extensions and settlement have attracted fees since 2003. Since then, fee levels have increased several times. Among common types of immigration application, the fee for settlement rose most sharply between 2003 and 2023 (from £155 to £2,885). The fee for study and skilled worker visas has increased less markedly (Figure 2).

In 2016, the government began publishing the estimated cost of processing immigration and nationality applications. As at October 2023, the fee for a study visa application was £311 higher than the cost, while the ‘profit’ on an application for settlement was £2,239. One reason the settlement fee is so high is that it is one of the applications from which migrants are expected to benefit most.

As noted earlier, the surplus from each application is used to fund wider immigration activities, not only operations that are directly related to the migrants who pay fees.

Figure 2

The IHS has also increased since it was introduced in April 2015, at a rate of £200 per person a year (or £150 for students and children). In April 2024, it stood at £1,035 per person a year (or £776 for students and children).

How does the Home Office set fee levels?

The Home Office takes into account various factors when setting fees. According to a Home Office Impact Assessment, these can include the administrative costs of processing an application, the wider costs of the immigration system, the benefits and entitlements of the product to a successful applicant, the promotion of economic growth, comparable fees charged by other countries, and international agreements.

The impact on economic growth is particularly hard to assess. In theory, higher charges could have negative economic impacts if they deter people from coming to the UK, but evidence on how fees impact migrants’ decisions is limited. In 2020, the Home Office concluded that immigration application volumes are largely unaffected by changes in fees. However, their analysis did not consider whether the impact changes if fees are already high. For example, a 10% increase in fees from a lower level (e.g., from £500 to £550) is likely to have less impact on demand than a 10% increase from a higher level (e.g., from £5,000 to £5,500). See the Evidence Gaps and Limitations section for more information about the Home Office review.

Evidence gaps and limitations

Qualitative research has found that immigration fees can have impacts on migrants standard of living, but the scale of the impacts is not known. For example, available data do not tell us how many people lose their immigration status or are unable to apply for settlement (which has no fee waiver) due to the costs.

The Home Office’s analysis of how migrants respond to fee rises has been referenced in impact assessments (IA) of application fee and IHS rate increases, including those implemented in October 2023 and February 2024, respectively. The analysis has significant limitations, beyond those discussed in the main text. Their conclusions were based on a review of academic literature that did not examine the impact of higher fees. Instead, it looked at other kinds of costs. For example, the studies reviewed did not directly evaluate how demand for study visas is affected by application fee levels, but how students’ demand for higher education is affected by tuition fee levels. In several cases, the research focused on domestic rather than international students.

With thanks to CJ McKinney for help creating Figure 2 and Daniel Sohege and Matteo Besana for comments on an earlier draft.

References

• Migrant Voice (2022). How the UK visa costs and process impact migrants’ lives. Available online
• Mort L, Whitaker-Yilmaz J, Morris M and Shah A (2023). Experiences of people on the 10-year route to settlement. IPPR, GMIAU and Praxis. Available online