In a significant move to curb immigration, UK Prime Minister Rishi Sunak has agreed to raise the minimum salary threshold for foreign skilled worker visas from £26,000 to £40,000. This substantial increase is expected to have an impact on freelancers and others such as contractors seeking to work in the UK.
The decision comes as part of a four-point plan devised by Sunak and former Home Secretary Suella Braverman to address migration concerns. The plan also includes removing graduate visas, reducing the number of dependents legal migrants can bring with them, and prioritising applicants to Russell Group universities for student visas.
The hike in the minimum salary threshold is likely to make it significantly more challenging for non-British freelancers looking to secure skilled worker visas. Many freelancers operate in fields where salaries may not reach the £40,000 mark, potentially excluding them from working in the UK.
Nothing has been set in stone, however, according to news reports, this development has been in the making for some time.
This development could have a ripple effect on the UK’s tech and creative industries, which rely heavily on the expertise and contributions of freelancers. These individuals often bring fresh perspectives, skills, and innovation to the workforce, contributing to the UK’s economic growth and global competitiveness.
Less competition from candidates who undercut British freelancers on rates could be welcome news for some British freelancers who are already struggling financially due to challenges from IR35 and the cost of living crisis.
Companies will also be impacted by increased costs. Higher salary thresholds could increase the cost of doing business for British businesses. This could lead to some businesses cutting back on their use of freelancers, or even moving their operations overseas.
Other concerns could include reduced opportunities for entry-level freelancers. For example, higher salary thresholds could make it more difficult for new freelancers to enter the UK market, as they may not be able to command the same rates as more experienced freelancers.
What are your visa options?
Freelancers and entrepreneurs who aspire to work or launch a business in the UK may need to consider alternative visa options.
Unlike other markets in Europe, the UK does not offer a specific Digital Nomad Visa. However, there are a few options available for individuals who want to live and work remotely in the UK. There are temporary worker visas
If you are a citizen of a visa-exempt country, you may be able to enter the UK on a Visitor’s Visa. This visa allows you to stay in the UK for up to 6 months, and you can work remotely during your stay. However, you will not be able to access UK public funds or receive any benefits from the UK government.
Skilled Worker Visa:
If you are a skilled worker from a qualifying country, you may be eligible for a Skilled Worker Visa. This visa allows you to live and work in the UK for up to 5 years. You must have a job offer from a UK-based employer that meets the minimum salary requirement.
Innovator Founder Visa
If you are a founder or co-founder of an innovative start-up business, you may be eligible for an Innovator Founder Visa. The start-up visa is no longer accepting applications as of July 2023.
Aspiring innovators and entrepreneurs from around the world can leverage the UK Innovator visa to establish or advance their business ventures in the UK for up to three years. However, gaining endorsement from an accredited UK organization is essential for your novel business concept.
Your business plan and idea will undergo rigorous evaluation and a comprehensive assessment process to ensure their viability and potential impact.
Global Talent Visa:
If you are a leader or highly skilled professional in a particular field, you may be eligible for a Global Talent Visa. This visa allows you to live and work in the UK for up to 5 years. You must be endorsed by a designated endorsing body in your field.
In addition to the visa requirements, you will also need to consider the following:
Tax residency: If you spend more than 183 days (6 months) in the UK in a tax year, you will be considered a UK tax resident and will be liable to pay UK taxes on your worldwide income.
National Insurance: If you are working remotely for a UK company, you may still be liable to pay National Insurance contributions.
Healthcare: If you are staying in the UK for more than 6 months, you will need to arrange private health insurance.