Preparing to Apply for Indefinite Leave to Remain Under the Contribution-Based UK Settlement Rules

The UK government plans to extend the residence requirement for Indefinite Leave to Remain (ILR) applicants from five to ten years. This may affect your settlement plans if you intend to apply for Indefinite Leave to Remain after 2026.

In this blog, our UK Immigration Solicitors look at the key proposed changes and explain how you need to prepare to apply for ILR under the planned contribution-based settlement rules.

When sweeping immigration reforms are announced and apparent certainty is taken away, you need the best immigration legal advice to help you navigate the new rules. At OTS Solicitors, our ILR experts will advise you on your visa and settlement options to help you prepare for a contribution-based settlement application.

Contact OTS Solicitors Today for Expert Immigration Legal Advice

Indefinite Leave to Remain status

ILR, or settlement, provides permanent non-visa immigration status. Indefinite Leave to Remain allows someone to live, work, and study in the UK without a visa or immigration restrictions. Importantly, it also provides access to free NHS healthcare, state services and benefits, as well as the stability and security of no longer having to submit visa extension applications.

Indefinite Leave to Remain is a standalone status. You do not need to make any further changes to your status if you do not wish to. However, most people are eligible to apply for British citizenship after holding ILR for 12 months.

Indefinite Leave to Remain reform

The government plans to significantly change the ILR application requirements with:

1. An increased residence requirement of ten years.
2. Contribution-based settlement.
3. Enhanced English language requirement.
4. New Life in the UK test.
5. Good character and criminality rule changes.

Indefinite Leave to Remain reform timeline

The timeline for the ILR reforms is widely anticipated to look like:

• 2025 to 2026 – consultation.
• 2026 to 2027 - transitional introduction of new requirements.
• 2028 to 2030 – introduction of contribution-based settlement across the relevant visa routes.

Who will be affected by the settlement reforms?

Most people who want to come to the UK to settle, or who are currently at the early stages of meeting the ILR residence requirement after entry on a visa, may be affected if the planned ILR reforms become law.

It is anticipated that the following visa holders will be affected:

1. Skilled Worker Visa holders.
2. Health and Care Worker Visa holders.
3. Global Business Mobility Visa holders.
4. Some Family Visa holders, although the government has said that spouses of British citizens will be exempt from the ten-year residence requirement.

The government has also indicated that some ILR applicants may not need to meet the ten-year residence requirement if they meet enhanced contribution criteria. The full enhanced contribution details are awaited.

Those with settled status under the EU Settlement Scheme will still be eligible to apply for settlement and Indefinite Leave to Remain after five years.

The cost of a ten-year residence and a contribution-based Indefinite Leave to Remain

Contribution-based Indefinite Leave to Remain will be costly for ILR applicants and for UK employers with sponsor licences because:

1. Applicants may need to pay visa fees and the immigration health surcharge for an additional five years.
2. Sponsoring employers who sponsor workers on Skilled Worker Visas may need to sponsor their overseas workers for an additional five years. This will result in increased certificate of sponsorship fees and immigration skills charge fees, as well as the administrative costs associated with sponsor licence sponsorship and compliance with reporting and recording duties.
3. Skilled Worker Visa holders will need to remain in sponsored employment for an additional five years. This will restrict their ability to change employers and prevent them from taking up employment in a role that does not qualify for Work Visa sponsorship.

Reducing the ten-year residence requirement

The government has said that some ILR applicants will not need to meet a new ten-year residence requirement if they meet an enhanced contribution threshold.  Details are awaited, but concessions could provide a fast-track to settlement if you are considered a high earner and therefore a financial contributor to the UK economy or if you have made enhanced social contributions. However, it is not yet clear whether contributions will fast-track ILR applicants to a five-year residence requirement or to a sliding scale of residence requirements.

Contribution requirements for Indefinite Leave to Remain

The government plans to place contribution at the heart of the settlement requirements. Contribution can be broken down into three aspects:

1. Financial or economic contribution.
2. Social integration.
3. Community contribution.

Financial contribution and Indefinite Leave to Remain

The financial contribution required will probably involve:

1. Continuous lawful employment (or an active business if in the UK on a Business Visa).
2. Payment of National Insurance contributions.
3. Financial resilience – so no reliance on state handouts, loan defaults or bankruptcies.

Community contribution and Indefinite Leave to Remain

No one knows how community contribution will be measured, but it is anticipated that credit may be given for:

1. Charity work.
2. Local community involvement.

Enhanced English language requirement

The English language requirement for settlement may rise from the current B1 level to the B2 level of the Common European Framework of Reference (CEFR). The enhanced English language requirement emphasises the government's importance of social integration as a precursor to UK settlement and reflects the requirement to work and engage with the broader community.

Life in the UK test

The revised Life in the UK Test may include more questions about contemporary life in the UK and British standards. However, the rules will probably still allow test exceptions for those under 18, over 65 or applicants with health issues that prevent them from sitting the test.

Criminal records and assessment of good character

The government intends to enhance the good character and criminality requirement for a settlement application. This means applicants will need to show:

1. They have no criminal convictions in the UK or overseas.
2. They have a good immigration record.
3. They have a good civil penalty record with no outstanding fines or investigations, such as an HMRC investigation.

A good immigration record involves no visa overstaying or findings of deception.

UK Immigration Solicitors warn that, until the settlement rules are finalised, no one can say whether a specific issue will result in a mandatory refusal of an ILR application or in a Home Office official exercising their discretion to refuse the application.

Uncertainties about applying for contribution-based Indefinite Leave to Remain

The one thing that both UK Immigration Lawyers and visa applicants and holders hate is uncertainty. Unfortunately, there is likely to be uncertainty over settlement rule changes for some time. This is going to be particularly unsettling for those in the UK who will not meet the current five-year residence requirement before the settlement rules change. Some of the uncertainties involve:

1. How the revised ILR eligibility criteria will affect those who entered the UK and applied for visas in the expectation that they and their family would qualify for settlement after five years.
2. How Home Office officials will assess the contributions and the evidence requirements to demonstrate matters such as volunteering or work in the community.
3. The eligibility criteria for ILR status after less than ten years of residence through reliance on the applicant’s contributions.
4. The appeal process for refused ILR applications under the new process.

Preparing to apply for Indefinite Leave to Remain under the new rules

Even though we do not know the details or timescales, it is best to prepare for the changes to the ILR eligibility criteria. If you do not do so, you may struggle to secure settlement as quickly as those who prepare for the changes.

At OTS Solicitors, our ILR Lawyers recommend that you:

1. Take immigration legal advice on visa extensions to ensure your visa extension application is submitted before your current visa expires.
2. Understand the restrictions on your visa so you do not jeopardise your immigration record.
3. Talk to an ILR Lawyer to understand the rules on ILR and the eligibility criteria. If your visa route does not lead to UK settlement, consider switching to one that counts time spent on the visa towards the residence requirement. Also, check the continuous and lawful residence requirements so you meet the criteria and can apply for ILR as soon as possible.
4. Keep records of your employment history and reasons for any gaps in employment.
5. Make a note of any volunteering or community activities and obtain evidence at the time of the activity, given the potential difficulty in securing evidence at the time of your ILR application.
6. Maintain financial resilience with no outstanding loan repayments or other financial irregularities.
7. Improve your English language skills if you do not already have an English language test certificate at the B2 level.
8. If you are a sponsored employee on a Skilled Worker Visa, understand the requirement for continued sponsorship over the extended residence requirement.
9. Keep a record and evidence of addresses and absences from the UK during the residence requirement.
10. Keep informed about the settlement rule changes.

Talk to OTS Solicitors

OTS Solicitors specialise in UK immigration law, including visa, extension, settlement, ILR, and British citizenship applications. Our Immigration Lawyers in London can help you with:

1. Assessing when you can apply to settle in the UK.
2. Advising on your ILR application.
3. Immigration legal advice to ensure your future ILR application stands the best chance of success.

Our immigration law expertise is recognised by our inclusion in the 2026 editions of the Legal 500 and the Chambers Guide to the Legal Profession.

Contact OTS Solicitors Today for Expert Immigration Legal Advice.

Contact us by phone or complete our online form to schedule an appointment at our London offices or arrange a phone or online consultation.

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