Sponsor Licence Renewal Explained
A sponsor licence is the Home Office’s approval for UK employers to recruit skilled foreign workers under routes like the Skilled Worker visa. Traditionally, sponsor licences were valid for four years and then had to be formally renewed in order to remain active. A renewal is an application submitted through the Home Office’s Sponsor Management System (SMS) to extend a licence and demonstrate ongoing compliance with sponsorship duties. Maintaining an active licence is essential: it ensures your company can continue sponsoring overseas staff and avoids interruptions to your workforce. Before April 2024, employers had to plan to renew their licence up to 90 days before expiry. Failing to renew on time meant the licence would lapse, jeopardising workers’ status (their visas could be cancelled, forcing them to leave or cease work).
When and Why to Renew?
Under the old rules, a sponsor licence had a fixed expiry date. Businesses renewed every four years to maintain their right to sponsor. You could submit the renewal application up to 90 days (3 months) before the licence’s expiry. In practice this meant setting internal reminders and logging into the SMS when renewal notices appeared.
If the employer did not renew in time, the licence would automatically lapse, and the organisation would no longer be authorised to sponsor migrant workers. This could cause serious operational disruption – existing sponsored employees might lose their right to work in the UK, and the company would have to cease hiring overseas talent. Renewing on time also demonstrated good faith and compliance to the Home Office.
Recent Changes (2024 Rule Change)
Effective 6 April 2024, the Home Office announced a fundamental change: the requirement to renew sponsor licences every four years has been abolished. In practical terms, licences originally due to expire on or after this date have been automatically extended for 10 years. The Home Office sent a message via the SMS on 24 January 2024, informing sponsors that “from 6th April 2024, we will remove the requirement to renew your sponsor licence” and that affected licences were extended by ten years. No action or application is needed by the licence holder.
In short, most sponsors no longer need to worry about four-year renewals at all. However, if your licence was due to expire before 6 April 2024 and you want to continue sponsoring after that date, you still had to submit a renewal application under the old process. After that one renewal, no further renewals will be necessary.
Required Documents and Compliance Checks
Even though the formal renewal process has changed, the Home Office still expects sponsors to maintain proper documentation and compliance. Key records include:
- Business registration and structure: Proof of UK company registration and an organisational chart.
- Regulatory and tax registrations: Copies of registrations for your sector, along with HMRC PAYE and VAT documents.
- Financial records: Recent accounts demonstrating the business is trading and financially sound.
- Proof of premises: Evidence of your operating address (e.g., lease agreement or utility bill).
- Staffing and HR documents: Payroll records, standard contracts, and HR policies (recruitment, right-to-work).
- Records of sponsored workers: An up-to-date list of current sponsored employees.
UKVI places strong emphasis on ongoing compliance. The Home Office can conduct announced or unannounced compliance visits and audits at any time. If you cannot prove compliance, UKVI may downgrade, suspend or even revoke your licence.
Consequences of Failing to Renew (or Comply)
If a sponsor licence expired without timely renewal (in the pre-2024 system), the employer would immediately lose its sponsorship status. In effect, UKVI would remove the organisation from the Register of Licensed Sponsors, and the visas of any currently sponsored workers could be curtailed or cancelled. The workforce impact is severe: employees may have to stop working or leave the UK until a valid sponsor licence is reinstated.
Under the new system, licences no longer expire (except via surrender or revocation). However, non-compliance still carries the same penalty: a licence can be suspended or revoked at any time if rules are breached. Revocation not only cancels sponsorship rights instantly, but it triggers a mandatory “cooling-off” period before the employer can reapply.
Legal Support from Lexington Ashworth Solicitors
Applying for a sponsor licence is complex and carries significant responsibility. Our Manchester-based immigration team offers expert guidance every step of the way. As SRA-regulated corporate lawyers, we pride ourselves on integrity, precision, and impact.
- Renewal and Extension Advice: We explain exactly what the new changes mean for your company.
- Compliance Audit Support: We conduct mock Home Office audits to test your procedures and highlight any gaps.
- Document Preparation and Review: We review and prepare any required documentation to demonstrate compliance.
- Sponsorship Management System (SMS) Guidance: We help you manage your SMS account and interpret Home Office notifications.
With Lexington Ashworth Solicitors, you gain UK-wide expertise delivered from our Manchester office. To discuss your sponsor licence needs or arrange a consultation, please contact our team.