What Are The Benefits And Costs Of ILR And British Citizenship?

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Dr Bernard Andonian

Dr Bernard Andonian is a highly respected immigration, nationality and human rights lawyer, former Immigration Judge, and recognised expert known for his longstanding experience, academic achievements and contribution to landmark legal decisions.

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Key points

• Indefinite Leave to Remain (ILR) costs £3,029 per person, while British citizenship by naturalisation costs £1,735 in total, including the mandatory ceremony fee.
• ILR grants permanent residence but leaves you as a foreign national; British citizenship confers full civic status, a right to a British passport, and the vote in general elections.
• ILR can lapse if you spend more than two consecutive years outside the UK, whereas citizenship is permanent and unaffected by time spent abroad.
• Children born in the UK to a British citizen are automatically British; children born to ILR holders are not.
• The Government’s proposed “learned settlement” reforms, expected from April 2026, may extend the standard qualifying period for ILR from five years to ten years for most work routes.

The two statuses explained

For anyone in the UK on a work or family visa, the path to long-term security follows a well-established sequence: temporary leave, then settlement, then (optionally) citizenship. The two endpoints of that sequence, Indefinite Leave to Remain and British citizenship, carry different legal weight, different rights, and different costs.

ILR is granted under section 3(1)(b) of the Immigration Act 1971, which provides that a person may be given leave to remain “for an indefinite period.” It removes time limits on your stay and allows you to work without restriction. You remain, however, a foreign national subject to immigration control.

British citizenship is acquired through naturalisation under section 6 of the British Nationality Act 1981. Once naturalised, you cease to be subject to immigration law altogether. You become a full British national with the same standing as a person born in the UK to British parents.

Eligibility for ILR

Most applicants on a Skilled Worker visa or a spouse/partner visa qualify for ILR after five years of continuous lawful residence. The core requirements are:

• Valid leave held throughout the qualifying period, with no breaches of immigration law.
• English language proficiency at CEFR B1 level or above.
• A pass in the Life in the UK Test.
• No more than 180 days spent outside the UK in any single 12-month period during the qualifying residence.

Applications are made online, and section 3C of the Immigration Act 1971 protects your lawful status while a decision is pending, provided you applied before your existing leave expired.

Eligibility for British citizenship

Naturalisation under section 6(1) of the British Nationality Act 1981 requires applicants to have held ILR for at least 12 months before applying. Those married to, or in a civil partnership with, a British citizen may apply under section 6(2), which carries a shorter three-year residence requirement and does not impose the 12-month ILR holding period.

The statutory conditions for naturalisation include:

• Age of 18 or above.
• Physical presence in the UK on the date five years before the application (three years for spouses of British citizens).
• No more than 450 days of absence from the UK in the five-year qualifying period, and no more than 90 days in the final 12 months.
• A pass in the Life in the UK Test and English language proficiency at B1.
• Satisfaction of the good character requirement, assessed by the Home Office with reference to criminal history, financial conduct, immigration compliance, and honesty.

Application costs in 2026

The fee structure was last updated on 9 April 2025 and remains in force. The table below sets out the headline costs.

Fee	ILR	British citizenship (naturalisation)
Home Office application fee	£3,029 per person	£1,605 per person
Life in the UK Test	£50 (if not already passed) up to £75 if taken out of hours	£50 (if not already passed) up to £75 if taken out of hours
Biometric enrolment	No fee	No fee
English language test (if needed)	Approx. £150 to £250	Approx. £150 to £250
Priority service (5 working days)	£500	Not available
Super Priority service (next working day)	£1,000	Not available

ILR applicants are exempt from the Immigration Health Surcharge, which otherwise costs £1,035 per year for adults on limited leave. Each dependant, including children, pays the full ILR fee of £3,029 individually. A family of four therefore faces a combined ILR cost of £12,116 before additional charges. Child citizenship registration carries a separate fee of £1,214.

British citizenship does not attract priority processing; the Home Office typically takes between three and six months to decide a naturalisation application. After approval, applicants must attend a citizenship ceremony and can then apply for a British passport at a cost of £88.50 online (adult standard).

Rights compared

	ILR	British citizenship
Immigration status	Settled; still a foreign national	Full British national
Passport	Country of origin	British passport; visa-free access to 180+ countries
Voting rights	Local and some devolved elections only	All UK elections, including general elections
Government and security roles	Often excluded	Eligible
Risk of losing status	Lapses after 2+ years outside the UK	Permanent (removal only in exceptional cases)
Children born in the UK	Not automatically British	Automatically British under s.1(1) BNA 1981
Dual nationality	You retain existing nationality	Permitted; UK law allows dual citizenship

Losing ILR and the security of citizenship

Article 13 of the Immigration (Leave to Enter and Remain) Order 2000 provides that ILR lapses automatically if the holder remains outside the UK for a continuous period of more than two years. A person whose ILR has lapsed must apply for a Returning Resident Visa from outside the UK, demonstrating strong ties and a justifiable reason for the absence.

British citizenship, once granted, is not affected by time spent abroad. It can only be revoked in narrow circumstances under section 40 of the British Nationality Act 1981: where citizenship was obtained by fraud, false representation, or concealment of a material fact (section 40(3)); or where the Home Secretary is satisfied that deprivation is “conducive to the public good” (section 40(2)). In the latter case, deprivation must not render the person stateless, unless the citizenship was acquired through naturalisation and the person’s conduct is seriously prejudicial to the UK’s vital interests.

The earned settlement proposals

The Government’s May 2025 White Paper, “Restoring Control Over the Immigration System,” proposed fundamental changes to the route to settlement. A public consultation ran until 12 February 2026, and implementation is expected from April 2026. The key proposals include:

• Extending the standard qualifying period for ILR from five years to ten years for most work visa holders.
• A longer 15-year qualifying period for workers in roles below degree level (RQF level 6).
• A points-based “earned settlement” framework, with high earners above £50,270 retaining the five-year timeline and those above £125,140 qualifying after three years.
• A mandatory minimum income requirement of £12,750 in taxable earnings for all ILR applicants.
• Partners of British citizens on Appendix FM routes are expected to retain their current five-year pathway.

Anyone approaching their current five-year qualifying period should take professional advice on whether to submit their ILR application before the new rules take effect.

Practical guidance for applicants

Proceeding to citizenship is generally advisable where:

• You intend to travel frequently or live abroad for extended periods, since ILR can lapse but citizenship will not.
• You want full political participation, including the right to vote in UK general elections.
• You plan to have children in the UK and want them to acquire British citizenship automatically at birth.
• You work in, or aspire to, government, security, or intelligence roles that require British nationality.

Remaining at ILR may be appropriate where:

• Your country of origin does not recognise dual nationality, and acquiring British citizenship would require you to renounce your existing nationality.
• You are uncertain about your long-term plans and may wish to return to your home country permanently.
• Cost is a concern and you do not currently need the additional rights that citizenship provides.

Common mistakes to avoid include: exceeding absence limits during the qualifying period; allowing gaps in lawful leave; and underestimating the good character requirement, which covers criminal convictions, financial irregularities, tax compliance, and immigration history.

Wrapping up

The case for progressing from ILR to citizenship has strengthened as the rules around settlement tighten. Citizenship offers permanence that ILR cannot fully guarantee. For anyone committed to a long-term future in the UK, securing the highest level of status available is a prudent step. Those who hold ILR and meet the requirements for naturalisation should give serious consideration to applying, particularly given the uncertainty surrounding the earned settlement reforms.

FAQs

What is the main difference between ILR and British citizenship?

ILR allows you to live and work in the UK permanently, but you remain a foreign national subject to immigration control. British citizenship makes you a full British national with the right to vote in all elections, hold a British passport, and pass citizenship to children born in the UK.

How much does ILR cost compared to British citizenship in 2026?

The ILR application fee is £3,029 per person. British citizenship by naturalisation costs £1,735 in total (£1,605 application fee plus £130 ceremony fee). Both may involve additional costs for English language tests and the Life in the UK Test.

Can I lose my ILR status?

Yes, ILR lapses automatically if you remain outside the UK for more than two consecutive years. It can also be revoked in cases of criminality, fraud, or where your continued presence is not considered to be in the public interest. British citizenship, by contrast, can only be removed in rare and exceptional circumstances.

Do I need to give up my existing nationality to become a British citizen?

No, the UK permits dual citizenship, and you are not required to renounce your original nationality when you naturalise. You should, however, check the laws of your country of origin, as some countries do not allow their citizens to hold a second nationality.

How will the proposed earned settlement changes affect me?

If enacted from April 2026, the standard qualifying period for ILR will increase from five to ten years for most work visa holders. High earners may still qualify after five years or fewer. Partners of British citizens are expected to keep the current five-year route. The proposals may apply to migrants already in the UK, so anyone nearing the end of their current five-year qualifying period should consider applying promptly.