These include plans to give some graduates a two-year Graduate visa, change salary requirements for Skilled Worker visas and expand the High Potential Individual route. The Budget also addresses how certain sponsorship fees paid by employers are taxed.
The changes could affect people planning to stay in the UK after university and businesses hiring overseas staff. However, they will not all take effect at once. Some are planned for 2027, while others still need detailed rules explaining who will qualify.
If you are preparing a visa application or planning to hire someone, you will need to check when the relevant changes take effect and whether they apply to your circumstances. Below, we explain what has been announced and what it could mean for you.
Graduate visa changes: who will get a two-year stay?
The government plans to offer a two-year Graduate visa to graduates of universities that meet its requirements for immigration compliance and graduate employment. This means the two-year option will depend on where you studied, rather than being available to every graduate. The detailed criteria will determine which universities qualify. Under the rules currently published, eligible graduates with non-doctoral qualifications receive a two-year visa if they apply by 31 December 2026. For applications submitted from 1 January 2027, the duration falls to 18 months. PhD and other doctoral graduates will continue to receive three years.
If you are approaching the end of your course, check the new criteria when they are published to see whether your university qualifies. Before applying, you will also need your university to have confirmed to the Home Office that you have successfully completed your studies.
In the meantime, keep track of when your current visa expires. Do not delay an application in the hope of receiving a longer visa unless you have confirmed that the new rules will apply to you and that you can still submit your application in time.
Skilled Worker salary requirements from spring 2027
For employers, the salary announcements need a closer look. From spring 2027, the government plans to lower occupation-specific thresholds from the median salary to the 25th percentile. At the same time, it will update the general threshold using 2026 wage data and introduce annual updates. The package also includes a single new entrant discount and removal of the separate PhD discount.
In everyday terms, the salary benchmark for a particular profession may fall, while the general threshold is updated separately. That is why a lower occupation-specific figure will not necessarily make every role cheaper to sponsor.
If you are budgeting for an overseas hire, work through the proposed salary for that particular role once the new figures and rules are available. For candidates, the same principle applies to a job offer: a headline about lower thresholds does not establish whether your offer meets the requirements.
More time to find a new job after sponsorship ends
The Budget also proposes a period of up to six months for the highest-skilled workers to find another job following visa curtailment. Implementation is planned for 2027, and the length of the period would depend on time spent in the previous highly paid role. Curtailment means that permission to stay is shortened. For someone whose job has ended, additional time could make a considerable difference to the search for a new employer.
The words “up to” matter, however. The announcement should not be read as a six-month guarantee for everyone on a sponsored visa. If your employment has already ended, check your position and any Home Office correspondence promptly rather than assuming a future measure has extended your deadline.
High Potential Individual visas for more graduates
The High Potential Individual visa route is set to expand to eligible qualifications from the world’s top 150 institutions, with a proportional increase in the cap. For someone exploring a move to the UK, this is a reason to revisit eligibility when the updated criteria become available. It is not enough to find your university in a well-known international ranking; you need to check the official Home Office requirements.
HPI should also be considered separately from the Graduate visa. The Budget mentions both, but they are distinct routes, and an announcement about one does not establish eligibility for the other.
Sponsorship fees and the new tax exemption
A less prominent announcement concerns employers paying the Immigration Skills Charge and Certificate of Sponsorship fees. HMRC has announced an exemption from Income Tax and Class 1A National Insurance for those employer-paid costs. The measure is to be legislated through Finance Bill 2026–27 and applies to payments made on or after 28 October 2026.
This changes the tax treatment of specified payments; it does not remove the fees themselves. Nor should it be taken to cover every expense associated with an employee’s visa. Employers should review relevant payments with their payroll or tax adviser, keeping a clear record of what was paid and when.
What should you do before your next visa application?
Before making plans, check when your current visa expires and when you can apply for your next one. This will help you work out whether the announced changes could apply to you or whether you need to proceed under the existing rules. Employers should also check how the timing affects their recruitment plans. If you are hiring someone before the new rules take effect, make sure the proposed salary and sponsorship arrangements meet the requirements that apply at the time.
Frequently asked questions
Has the Budget restored a two-year Graduate visa for everyone?
No. The announcement applies to university graduates who meet specified compliance and employment criteria. Check the applicable rules and your application date before relying on it.
Will sponsoring a Skilled Worker become cheaper?
Not necessarily. The package combines changes to occupation-specific salary requirements with an update to the general threshold. The effect will depend on the role and the applicable rules.
Have the sponsorship fees been abolished?
No. The announced exemption concerns the tax treatment of employer-paid Immigration Skills Charge and Certificate of Sponsorship fees, not the abolition of the fees.
