Government makes £5bn a year from immigration fees while applicants are forced into debt

• The government’s vast profits from the UK visa system run counter to claim that migrants are a financial burden on the state

• Fees charged for visas, citizenship and health surcharge far outstrip the actual cost to the Home Office

• Families trying to settle and stay in the UK are giving up basic essentials to cover tens of thousands in costs

When Bethany Sparrow fell in love, she didn’t expect that moving in with her partner would put her on the breadline.

She and Moheb met on holiday in Tunisia and they got married a year and a half later. But to live together in the UK, they discovered, they would have to pay the British government £5,000.

Already working full-time as a teaching assistant for children with autism, Bethany took a second job at JD Sports on weekends and school holidays. That still wasn’t enough, so she started cutting back on essentials – “sacrificing everyday normal things, sacrificing food”.

“[The government’s] not thinking about what it’s doing to families, how emotionally exhausting it is, how much we’re having to save,” she said. “I lost so much weight … [It was] the worst experience I’ve ever dealt with in my whole life. You can’t even put into words how mentally draining it is.”

After almost a year, though, they saved enough for Moheb’s visa and, in March, he moved to the UK. But even with both of them working and saving everything they can, they are unsure if they will be able to afford his visa renewal when it is due in 2028.

Bethany Sparrow at home with her husband Moheb

Phil Hitchman

Reunite Families UK, a nonprofit organisation supporting families affected by visa rules, estimates that visa and citizenship applications could end up costing Bethany and her husband more than £13,000.

The couple are not alone. Hundreds of thousands of people are forced to pay these rising fees every year – and many have amassed eye-watering debts to cover the costs. The majority are people who have already been in the UK for years and are looking to renew their visas or settle.

And, contrary to the common claim that migrants are a financial burden on the country, the British state makes billions of pounds in profit from these fees – some of which are more than 10 times the actual administrative cost.

According to our analysis, the government raked in almost £5bn last year in profit from various visa, citizenship and immigration charges. That’s more than it gets in corporation tax from all of the energy, gas, water, sewage and hospitality industries combined.

“I think the government knows how desperate people are to stay in this country, so they’re taking advantage,” said Rumbidzai Bvunzawabaya, a solicitor and CEO of Tulia, a charity that supports migrant workers. “And what makes it worse is that then they always scapegoat migrants and say they’re just coming in to freeload.”

Matteo Besana, head of policy and advocacy at Reunite Families UK, said it was “a national scandal that the Home Office has been allowed to profiteer for as long as it has”.

“The current visa system is a form of double taxation that deliberately keeps people and children in poverty. No government should be able to justify this.”

‘Easy money’

The UK has the most expensive immigration fees in Europe. In part, this is because it makes a profit on most applications. But this wasn’t always the case.

Around 20 years ago, people only had to pay what it cost the government to process the visa. For Bethany and her husband that would have meant a one-off charge of £260. Other visas were even cheaper.

This changed in 2005 under Tony Blair’s government. Since then visa costs have spiralled far above the rate of inflation.

To give one example, the cost of a settlement application, also known as indefinite leave to remain (ILR), has increased by more than 20 times in the space of two decades, from £155 to £3,226. Similar increases have taken place with work visas, citizenship applications for UK-born children of immigrants, and for student visas, among others.

Then, in 2015, the Conservative and Liberal Democrat coalition government added another fee many migrants had to pay on top of their visas: the immigration health surcharge. The charge, which helps fund the health system, can cost someone as much as £1,035 per year.

The Oxford Immigration Observatory calls it a form of “double taxation”. Migrants, who already pay more in tax than they take out of the system, are then charged again via the surcharge.

The research centre estimates that, through the different charges and renewals, someone on the skilled worker visa will pay upwards of £24,000 before they can become a British citizen. A family with one child could pay over £40,000.

Layla Hussain, advocacy officer at the charity Refugee & Migrant Justice said the government is making “obscene profits” from migrants who then face barriers to building their lives in the UK.

She described young people being prevented from going to university because of their immigration status, parents having to choose between feeding their children and paying fees, and families taking on debts that take decades to repay.

A Home Office spokesperson denied that the government profited from these fees, saying the money is put towards the wider migration and borders system. This includes immigration enforcement, border force and detention centres.

The spokesperson said: “It is right that those who benefit from the migration and borders system contribute towards its costs, reducing the burden on taxpayers.” They added that the health surcharge ensures migrants make a “fair contribution” to the NHS.

But the scale of the fees have historically been opposed by politicians who now hold senior positions in government.

In 2018, Yvette Cooper, now the health and social care secretary, said the scale of citizenship fees “has become a real and growing problem”.

Stephen Doughty, a minister in the Commonwealth and Development Office previously called for a review into the fees being charged saying “it is never acceptable … to make a profit on these crucial activities”.

David Lammy, who until recently was deputy prime minister, said while in opposition that people were being “exploited by excessive fees”.

As part of this story we asked them if they stood by these statements. None of them replied.

“Now, when they have the chance to make things better, they have not only gone quiet but are set to massively increase charges for migrants through the Immigration and Asylum Bill,” said Green Party MP Sian Berry.

“The government is treating people who have built their lives here as a source of easy money, regardless of the hardship it causes.”

The bill Berry refers to is proposing to extend the period people have to spend in the UK before they can settle to as long as 30 years. This will mean people will face more visa renewals – and with them, more fees.

When proposing immigration changes earlier this year, the home secretary Shabana Mahmood justified them by suggesting immigrants are a burden on the taxpayer.

Such claims have largely been debunked, with even the Office For Budget Responsibility, the government’s independent forecaster, estimating that reducing net migration by 100,000 per year would leave the public purse £7bn worse off a five-year period.

‘A disaster’

People on the lowest incomes can apply for a fee waiver on some visa applications, but as 78-year-old Pat Dore discovered, the decisions are not always fair.

Pat’s son, a former software developer, has been unable to work since developing ME and couldn’t afford to pay for his wife and daughter’s visas. Initially, Pat paid the combined £7,000 visa and surcharge fees, amassing credit card debt in the process. She had already been failed once by the state, as a victim of the Post Office scandal, and she used her compensation from that ordeal to cover the costs.

But when it came time to renew the visas two and a half years later, the family had no savings left. Pat’s son applied for a fee waiver – and it was refused.

As part of the application, he had provided bank statements from his Smile account. In its rejection, the Home Office said that records showed he had a bank account with the Co-op, which he had not disclosed. But Smile is a brand name for the Co-op; the account they were asking for was the one he had told them about.

Pat has now increased her credit card limit to cover this second set of visa and solicitor fees.

A government review from last year found several cases of Home Office officials making mistakes on fee waiver applications, including refusing an application from a homeless 18-year-old because she could not provide copies of bank statements or a tenancy agreement.

“I had high hopes for Labour,” Pat said. “[But] if you’ve got disabled people in your family and immigrants, it’s a disaster because they’re the two people they’ve gone for.”

‘To somebody else I don’t belong’

John Mataruse, 44, and his family were among the lucky ones. Originally a relationship manager at a bank in Zimbabwe, he came to the UK in 2021 after his wife was offered a job as a nurse in the NHS. As a health worker, the family was exempt from paying the health surcharge and their initial visas were cheaper than those of other skilled workers.

When it came to applying for settlement, they had to pay the same as everyone else. The full bill for all four family members, including language tests and biometrics, came to more than £15,000. They couldn’t afford this sum so took out a personal loan which will take them years to pay off.

If the Home Office had charged them what it costs to process the applications, they would have paid £1,240.

ILR applications are among the most profitable for the Home Office: only £310 of the £3,226 charge covers the actual administrative cost of processing the application.

John’s family also paid an extra £2,000 to fast-track the applications and avoid spending up to six months in a state of limbo waiting for the government to make a decision.

He could have waited, but he says he was worried the government could change the rules and leave his family in an uncertain situation for even longer, racking up visa charges for years. It’s a choice many people are facing with the looming immigration bill.

Fatima*, who arrived in the UK from Pakistan when she was five, told us that her family put the cost of her ILR application on a credit card they couldn’t afford.

She estimates that by the time they are able to pay it all back, they would have paid twice as much as the original fee in interest payments.

Fatima says she comes from a country looted by the British Empire. Her family members fought for Britain in two world wars. “I feel this should be free… if anything the Home Office should compensate us.”

For both Fatima and John, permanent residency has brought some peace of mind, albeit at a steep cost. But John says there is another side to it.

Referring to the recent Belfast riots that targeted migrant communities, he says: “I paid all that, but in a moment a demonstration can lead me to running away from my home.

“Yes, I’m settled. But then at the same time, to somebody else, I still don’t belong … There are many good people around, but also when you look at the news you realise that a few bad people can make life hell for you.”

Because of this, on top of the debt repayments, John is also trying to save money in case he needs to return to Zimbabwe.

“At least there no one can tell me to go back to where I came from,” he said.

* Name has been changed