Can a Start-up Company Obtain a Sponsor Licence?
There is a misconception among entrepreneurs and start-ups that sponsor licences are ‘out of their league’ and the preserve of the PLCs and well-established SMEs.
As London Immigration Solicitors specialising in first-time sponsor licence applications, we encourage start-ups to call us and discuss how we help fledgling businesses obtain their first sponsor licence.
UK Online and London-Based Immigration Solicitors and Sponsorship Licence Lawyers
For start-up sponsor licence advice call OTS Solicitors on 0203 959 9123 or contact us online.
Sponsor licences for start-ups
Our Sponsorship Licence Lawyers often meet with incredulous glances when we tell entrepreneurs that a start-up company can apply for a sponsor licence to self-sponsor or sponsor specialist overseas employees to grow the business.
The next assumption our Business Immigration Solicitors often have to dispel is that sponsor licences for start-ups only relate to new tech companies with scope for rapid expansion because their business idea is innovative or adds value to existing tech. Although most start-ups applying for sponsor licences are in the tech or digital sector, any new business can apply for a sponsor licence if it meets the criteria.
Start-up company criteria to apply for a sponsor licence
There are no start-up company criteria to apply for a sponsor licence – the immigration rules on whether your company qualifies to apply for a sponsor licence are the same whether the company is a family business that has been operating for 100 plus years, a multi-national PLC or a tech start-up that is the brainchild of one individual and set up on a shoestring. The only difference the size of your company makes is the sponsor licence application fee – businesses classed as ‘large’ pay a higher sponsor licence application fee to the Home Office.
To qualify for the small sponsor licence application fee of £536 your business needs to meet at least two of these criteria:
- Annual turnover is £10.2 million or less
- Total assets are worth £5.1 million or less
- Have 50 employees or fewer
The company criteria to apply for a sponsor licence are simple; you need a company that is a genuine trading company registered at Companies House. You also need the evidence to back that up. The specific documents needed depend on the nature of your business. However, all applicants need to disclose at least four of these documents:
- Evidence that the company is registered with HMRC and the HMRC VAT registration certificate
- Latest available company accounts certified by a company accountant
- Latest acknowledgement of the company tax return
- Evidence of employers’ liability insurance covering at least £5 million from an insurer authorised by the Financial Conduct Authority (FCA)
- Latest business bank statement from a bank regulated by the FCA
- Proof that the business owns or leases business premises
Depending on the nature of your business and your chosen sponsorship route other information and paperwork may be necessary.
Definition of start-ups in the sponsor licence application guidance
The Home Office has issued guidance on how to apply for a sponsor licence and Appendix A of that guidance is entitled ‘’supporting documents for sponsor licence application’’. Table 2 of Appendix A applies to ‘’start-ups, franchises, charities and organisations subject to regulation or inspection.’’
The Appendix defines a start-up as a business operating or trading in the UK for less than 18 months on the date of the sponsor licence application.
Table 2 specifies that evidence of a current, corporate bank account with a bank registered by the Financial Conduct Authority and the Prudential Regulation Authority in the UK is required unless the business is applying for a licence under Global Business Mobility – UK Expansion Worker.
For franchise start-ups, a copy of the signed franchise arrangement is needed. Where a business is subject to mandatory registration or inspection evidence of registration and inspection is necessary. For example, financial or insurance businesses carrying out regulated activities must be registered with the Financial Conduct Authority or the Prudential Regulation Authority.
Table 3 of the guidance relates to route-specific documents so your start-up may also need to provide evidence under Table 3.
A common reason for sponsor licence refusal is supplying incorrect or insufficient paperwork. That’s why our Sponsorship Licence Lawyers recommend that you take legal advice before applying for a start-up sponsor licence as the guidance and tables are not clear cut.
Start-up systems and sponsor licence applications
As well as providing the correct paperwork your company also needs to show the Home Office that you have appointed appropriate people as key personnel and have suitable systems and procedures to manage the sponsor licence.
Some start-ups assume the procedural requirements will be particularly challenging for a new company. However, our Sponsorship Licence Lawyers find that start-ups are easier to help with their licence applications as they don’t have long histories of working to set procedures and tend to be more flexible about tweaking any existing systems to meet the requirements of the Home Office sponsor management system.
When it comes to key personnel, new business owners are wary about applying for a sponsor licence thinking that their start-up will need to employ extra staff to act as key personnel but that doesn’t need to be the case.
Three key personnel roles need to be sorted out, namely:
- Authorising officer – the person with responsibility for the sponsor licence
- Key contact – the main point of contact between the company and the Home Office
- Level 1 user – the person responsible for the day-to-day management of the licence
One person can be appointed for all the key personnel roles but the appointed person must be a company office holder or employee and a British citizen or be settled in the UK and based in the UK.
After the sponsor licence has been granted you can add a Sponsorship Licence Lawyer as your level one user to manage the sponsor licence for you. OTS Solicitors provides a specialist start-up sponsor licence application service as well as a full Sponsor Licence Management Service so you can focus on building your start-up. As your business expands you may want to take the sponsor licence management in-house as your HR team grows. If you decide to go down that route, our Business Immigration Solicitors can provide your team with the Immigration Law Training they need to ensure that your growing company continues to meet its sponsor licence reporting and recording duties.
OTS Solicitors start-up sponsor licence package
If your start-up needs business, employment and immigration legal advice our specialists can help. When it comes to your sponsor licence application, we will support you through:
- Advising you on the sponsor licence that would best meet your business immigration and growth requirements
- Specialist visa advice for start-up tech companies
- Guidance on the paperwork needed to apply for your sponsor licence
- Carrying out a pre-sponsor licence audit to ensure your systems meet sponsor licence requirements and, if not, suggesting tweaks
- Advising on the appointment of key personnel
- Sponsor licence submission including advice on the Home Office priority service to speed up the application process
- Immigration Legal Training for your key personnel
- Sponsor Licence Management Services
- Sponsor licence troubleshooting
Our Business Immigration Solicitors aim to partner with your start-up from your first sponsor licence application and to remain your trusted Sponsorship Licence Lawyer and Sponsor Licence Management Service provider as your company grows.
UK Online and London-Based Immigration Solicitors and Sponsorship Licence Lawyers
For start-up sponsor licence advice call OTS Solicitors on 0203 959 9123 or contact us online.
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