As UK start-ups grow, many find that recruiting internationally is essential to securing the skills needed to scale. To lawfully employ overseas workers who require a visa, a business must first obtain a Sponsor Licence from the UK Home Office.

This guide explains how a start-up can apply for a Sponsor Licence, what the Home Office expects before granting approval, and how to maintain compliance once a licence is issued. It also includes a practical checklist to help businesses prepare for Home Office compliance checks.

Understanding the Sponsor Licence

A Sponsor Licence is permission granted by the Home Office that allows a UK organisation to employ overseas nationals under the UK immigration system. Once licensed, an employer can assign Certificates of Sponsorship, which are required for a worker to apply for a relevant work visa such as the Skilled Worker route.

For start-ups, holding a Sponsor Licence enables access to a wider talent pool and supports long-term growth plans. Without a licence, most overseas nationals cannot be employed, and non-compliance can result in fines, application refusal, or further enforcement action.

Sponsor Licences are available under different categories depending on the type and length of employment. Most start-ups apply for a licence under the Worker route to sponsor long-term roles.

Are Start-Ups Eligible for a Sponsor Licence?

The Home Office does not exclude new or small businesses from sponsorship, but it applies the same compliance standards to all employers.

Your business must be legally registered in the UK and be operating or genuinely preparing to trade. You must also show that any role you intend to sponsor is genuine and meets the required skill and salary thresholds for the visa route.

A key part of the assessment is whether the business has suitable systems in place to meet its sponsorship duties. The Home Office will consider how you manage employee records, monitor immigration status and report changes.

Pre-Licence Compliance Requirements

Many Sponsor Licence applications are refused because the Home Office is not satisfied that the business is compliant before applying. The expectation is that systems are already in place, not introduced after approval.

Before a licence is granted, and potentially during a pre-licence compliance visit, you may be asked to provide evidence covering the following areas.

Employee information and identity records

You should hold accurate personal details for each employee, including full name, date of birth and emergency contact information. Copies of passports or other acceptable identity documents must be retained for all current staff.

Right to work processes

You must be able to demonstrate that right to work checks have been carried out correctly for all employees. This includes retaining copies of documents checked, recording the date of the check and ensuring the process follows Home Office guidance.

Employment contracts

You must hold signed contracts of employment for existing employees. If you intend to sponsor new roles, draft contracts should also be available and clearly set out job duties, salary, hours and work location.

Financial evidence

The Home Office will expect to see recent business or corporate bank statements, usually covering the last three months. These should show active trading and clearly identify salary payments made to employees. Also have contracts with customers.

Absence and leave records

You must be able to show how employee absences are monitored and recorded, including annual leave, sickness absence and any unauthorised or extended periods away from work.

Monitoring immigration status

Where employees hold visas, you must keep records of their immigration status and demonstrate how visa expiry dates are tracked to ensure continued permission to work in the UK.

Workplace pension arrangements

Evidence of a workplace pension scheme must be available, along with confirmation that eligible employees are enrolled in line with auto-enrolment requirements.

How to Apply for a Sponsor Licence

Applications for a Sponsor Licence are submitted online through the Home Office Sponsorship Management System.

Before applying, all supporting documents should be prepared and checked against the Home Office requirements. Only documents listed in Appendix A of the Sponsor Guidance are accepted, and failure to provide the correct evidence can delay or jeopardise the application.

Once the application is submitted and the relevant fee is paid, supporting documents must be provided within the required timeframe, usually five working days. The Home Office will then assess the application and may decide it on the documents alone or arrange a compliance visit.

If approved, the Sponsor Licence is normally granted presently for a ten year period.

Sponsor Licence Compliance Checklist for Start-Ups

1. Employee personal details including name, date of birth and emergency contact information;

2. Copies of passports or other proof of identity for all employees

3. Evidence of completed right to work checks

4. Signed employment contracts for existing employees

5. Draft contracts for future sponsored roles

6. Business or corporate bank statements covering the last three months

7. Payroll records showing salary payments

8. Records of annual leave and other absences

9. Immigration status records and visa expiry monitoring

10. Workplace pension scheme documentation

11. Processes for reporting changes through the Sponsorship Management System

12. Sector-specific contracts where applicable, including council or NHS agreements for care providers

Home Office Compliance Visits and Ongoing Responsibilities

The Home Office may conduct compliance visits either before granting a licence or at any point during its validity. These visits may be announced and are done over Microsoft teams platform.

During a visit, compliance officers may review HR systems, examine employee files and speak with key personnel responsible for sponsorship. Where breaches are identified, enforcement action may follow, including suspension or revocation of the licence.

Maintaining organised records and clear internal processes is essential to reducing compliance risk.

Why Professional Advice Can Make a Difference

Sponsor Licence applications and ongoing compliance obligations can be challenging for start-ups, particularly where HR resources are limited. Mistakes at the application stage or failures to meet ongoing duties can disrupt recruitment plans and place the business at risk.

Professional immigration support can help ensure the application is prepared correctly, compliance systems are robust, and the business is well positioned to pass Home Office checks.

If your business is considering applying for a Sponsor Licence or wants to ensure it is fully prepared for Home Office compliance checks, our immigration specialists can assist.

Contact us today to arrange a Sponsor Licence assessment and receive tailored advice to support your recruitment plans and long-term compliance.