Over the last 6 years, the SIA has been able to use historical reserves, accrued before April 2020, to provide a £20 per licence rebate towards the application fee cost. In practice, this is currently reducing the amount paid by an applicant from £204 to £184 a licence. Those historical reserves are now fully exhausted and so the cost to apply for a licence will revert to the statutory fee of £204.
The statutory licence fee itself is not increasing. It has remained at £204 since the SIA reduced it from £210 in April 2023. The change means applicants will no longer benefit from the £20 rebate.
Both first-time applications and renewals will cost £204 from 1 April 2026.
Michelle Russell, SIA Chief Executive, said
Since 2020, we were allowed to subsidise the cost of an SIA licence from previous historical reserves which had been built up. Those reserves are now gone, and we have a responsibility as a self-funding regulator to charge the full cost of the services we deliver.
We have worked to keep the licence fee as low as possible and have absorbed rising third party costs along the way. At £204, the fee remains considerably lower in real terms than when we introduced licensing more than two decades ago. We will continue to drive efficiency and productivity so we can keep costs down for the people we regulate.
The SIA is largely self-funding, save for the capital grant funding it receives from the Home Office each year.
The individual licence fee set covers all related operating costs as well as relevant overheads, taking care to minimise cross-subsidising other fees (including ACS fees).
The fee remains cheaper in real terms than when SIA licensing began. The licence cost £190 in 2004. If accounting for inflation, that would be £347 today.
Find out more
Read Change to the SIA licence fee your questions answered to find out more.
Background
The SIA must charge and set its fees at a level to recover the full costs of the services provided and in a way that ensures government neither profits at the expense of consumers nor makes a loss for taxpayers to subsidise.
The agreed licence rebate scheme started in April 2020 for a maximum of 2 licensing cycles (6 years, ending by 31 March 2026), with the aim of utilising a historic accumulated reserve balance. It was approved by HM Treasury as an arrangement to ensure that the SIA did not hold any unnecessary reserves going forward. The rebate, applied at the point of payment, was established at £20 based on the volume of applications the SIA expected over the 6-year period. Those historical reserves have now expired.