Settled status is central to British nationality law, as the most usual route to naturalisation or registration as a British citizen requires that the applicant be settled in the UK. Settled status is also important where a child of non-British citizen parents is born in the UK, as unless at least one parent has settled status the child will not automatically be a British citizen.
Holders of indefinite leave to remain may apply for naturalisation as a British citizen after at least five years' residence in the United Kingdom, provided that they have held ILR for at least one year. Those who hold another form of British nationality may instead apply for registration, which is a simpler process than naturalisation.
Because in most situations ILR is only granted after five years in the United Kingdom, and a further 12 months residence with ILR is required for naturalisation, the effective waiting time for naturalisation is six years in most instances.
If married to, or in a civil partnership with, a British citizen the residence period for naturalisation is three years and there is no minimum period required for ILR to be held. There is no similar concession for registration, although British nationals (other than British citizens) may choose to apply for naturalisation instead.
A child born in the United Kingdom after 1983 to persons who are not British citizens will automatically be a British citizen if at least one of its parents has indefinite leave to remain or other settled status at the time of the child's birth.
Prior to 1 July 2006, only a legitimate child (born to parents who are married to each other) could automatically derive British citizenship from the father, if the father was a British citizen or "settled" in the United Kingdom. However, if the parents are not married when the child is born in the United Kingdom, but then get married, and the marriage legitimates the child, then if the father was a British citizen or "settled" in the UK when the child was born, the child would become a British citizen and would be regarded as having been one from the date of marriage. This only affects children where the mother is neither a British citizen nor "settled" in the UK.
Where a child would be a British citizen but for the fact that the parents are not married, the Home Office will usually register the child as a British citizen under section 3(1) of the British Nationality Act, provided the child is still under 18.
If ILR is acquired after the child's birth, the child will not automatically be a British citizen. However the child can be registered as a British citizen under s1(3) of the British Nationality Act 1981 provided application is made before the age of 18. Alternatively, if the child lives in the UK until age 10, it will have a lifetime entitlement to registration as a British citizen under s1(4) of the Act.
Children born in the United Kingdom before 1983 are British citizens regardless of the immigration status of their parents (unless the father was at the time of the child's birth a diplomat accredited to the United Kingdom).
Traditionally, indefinite leave to remain in the UK has been free. However, under the Labour administration, fees were introduced and have risen rapidly. From free in 2003, ILR was first charged at £155 In 2005 this was raised to £335, before being raised again to £750 in 2007
Under the law as it existed between 2 October 2000 and 29 April 2006, a citizen of an EEA state or Switzerland could be granted permanent residence on application after four years resident in the United Kingdom exercising Treaty rights (five years from 3 April 2006). Prior to 2 October 2000, citizens of EEA states were deemed to be permanent residents immediately upon taking up residence in the UK to exercise Treaty rights.
The change in the law in 2000 was retroactive. Hence, for example, a German citizen who arrived to work in the UK on 1 July 1986 would have been treated as a permanent resident between that date and 1 October 2000. From 2 October 2000 his or status status reverted to that of a temporary resident if an application for ILR was not made. And on 30 April 2006, with 5 years' residence exercising Treaty rights accrued, he or she would have regained permanent resident status.
With effect from 3 April 2006, the period of time required to obtain Indefinite Leave to Remain increases to five years. These changes were debated in House of Commons Standing Committee on 20 June 2006 All Labour MPs voted for preserving the retroactive aspect of the changes, while all other MPs voted that the Government should bring in transitional arrangements to allow those already in the UK before the rule change to qualify under the previous four-year rule. These changes were protested in demonstrations and rallies in London on 16 June and 23 July 2006.
The changes were retroactive in the sense that people on a four-year visas must apply for a one-year extension before they can apply for ILR, but they did not affect people who had already been granted ILR after four years.
As from 3 April 2007, a new condition has been added that "the applicant has sufficient knowledge of the English language and sufficient knowledge about life in the United Kingdom, unless he is under the age of 18 or aged 65 or over at the time he makes his application." (See )
There are two ways the applicant can meet this condition:
ILR may be lost if a person leaves the United Kingdom and on return is given leave to enter other than for an indefinite period. This may be because, e.g., they mistakenly seek to enter as a visitor, or the immigration officer believes that they do not intend to reside in the United Kingdom.
ILR may also be curtailed by the Home Secretary for reasons of national security or if the holder of the ILR commits an offence that could lead to their deportation from the United Kingdom
A person may also lose ILR by leaving the United Kingdom for more than two years. However, in some circumstances such a person may reapply for indefinite leave to enter the UK.
"Indefinite Leave to Remain" is also the title of a song by the British group the Pet Shop Boys, and appears on the album Fundamental. The song uses the idiom of immigration as the basis of a love song, keeping with the theme of the politics of artificial fear that dominates the album.