Home Office has tightened checks on sponsor licenses in several scenarios. First and foremost, cases come under enhanced scrutiny when a revoked license is replaced with a new one, or when employees are transferred under the Two Paid Transfer visa route. Primary applications from new employers and re-issued licenses after a cooling-off period also face checks.
When Home Office looks more closely
The main reason for enhanced scrutiny is the fight against fraud. The department identifies patterns that raise suspicion: one sponsor opening multiple companies, changing authorised officers (sometimes within the same family: husband, wife, friend, partner) or setting up a new firm with different directors but otherwise identical structure. Home Office fears that such transfers mask manipulation of the system.
Two Paid Transfer: why it raises questions
When a sponsor license is revoked, employees can remain with the same employer through the Two Paid Transfer mechanism — transferring staff while preserving all employment rights to a new sponsor without submitting new visa applications. On paper this is lawful, but Home Office sees two potential issues.
The first is financial. When transferring employees, no new fees are required: neither visa fees (around £943 for three years, double for five) nor Immigration Health Surcharge (£1,350 per year) nor sponsor certificate payments (£525 per employee). The state loses substantial revenue.
The second is intent. In 90% of cases Home Office sees, Two Paid Transfer conceals an attempt to circumvent the system. If the employee should have actually been dismissed and re-hired at the new company, then it should be properly formalised — with a new job offer, with payment of all fees. A clean license and full payments look more credible than a transfer.
License rejection: error correction procedure
A sponsor license can be rejected for many reasons: insufficient funds, no evidence of a genuine role, weak bank statements, lack of financial justification.
If a license is rejected, the employer can submit an error correction form. This is not an appeal or substantive review. Home Office treats it as an administrative check: whether an administrative error was made in the initial assessment, for example if the office did not see an attached document. If Home Office does not agree that an error occurred, the form will be rejected without substantive reconsideration.
After that, only court action remains. Home Office officially recommends employers whose licenses are rejected and whose error correction also fails to submit a pre-action protocol request and seek Judicial Review. This is the only way to force the department to reconsider the refusal on its merits.
How to reduce the risk of scrutiny
If a company loses its license, it is most reliable not to transfer employees but to re-hire them. Even if the ownership structure is similar, engage them on full employment terms, submit new sponsor certificates, gather complete visa document sets. Each will require a new visa, a new fee, new confirmation of rights — this appears more credible to Home Office and is less likely to face additional scrutiny.
For new licenses and those re-issued after the cooling-off period, prepare supporting documents more carefully: bank statements, financial justification, clear job descriptions. This is especially important when re-submitting after rejection.
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