The Apprenticeship Levy

 

T he introduction of the new Apprenticeship Levy in April 2017 has changed the way Apprenticeships are funded and how businesses like yours will work with training providers like us.  

What is an Apprenticeship Levy?

In July 2015 the Government announced the introduction of an Apprenticeship Levy, which businesses started paying in April 2017.

The Levy is designed to encourage employers to embrace Apprenticeships as a way of meeting their current and future skills needs. 

Who will pay the Levy?

All employers in the UK with a paybill greater than £3 million each year will have to pay the Levy.

How much will I have to pay?

The Levy is charged at 0.5% of payroll for employers with a pay bill greater than £3 million.

How is the Levy collected?

The Levy is collected monthly through Pay As You Earn (PAYE) alongside Income Tax and National Insurance.

How will I be able to access my Levy?

You will be able to manage your Levy through an account with the Digital Apprenticeship Service. The Digital Apprenticeship Service will enable you to:

  • See Levy funds you have available and spend with a registered training provider in England

  • Select Apprenticeship you want to use

  • Confirm the training provider(s) you want to use to deliver your apprentices’ training

  • Confirm the price you’ve agreed with your training provider

  • Pay for Apprenticeship training and assessment

  • Choose an assessment organisation

  • Post Apprenticeship vacancies.

If you have not already registered with the Digital Apprenticeship Service, please do so as soon as possible.

Funds you don’t use will expire 24 months after they enter your account. For example, funds entering your account in September 2021 will expire in September 2023. Payments from your account to your training provider always use the oldest funds first.

What about Non-Levy employers?

For Employers who are not eligible for paying the Apprenticeship Levy, a financial contribution may need to be made towards the training. If an Apprentice is aged 16-18, the Government will fund the full apprenticeship, up to the maximum value of the funding band. If the Apprentice is aged 19+, Employer's will co-invest 5% of the total cost of the programme whilst the Government will pay the remaining 95%, up to the maximum value of the funding band. Any costs incurred over the funding band will be chargeable to the Employer.

Help & Guidance:

Apprenticeship Levy- How will it work? - https://www.gov.uk/government/publications/apprenticeship-levy-how-it-will-work/apprenticeship-levy-how-it-will-work

Guidance for Non-Levy Employers - https://www.gov.uk/government/publications/apprenticeship-levy-how-it-will-work/apprenticeship-levy-how-it-will-work#non-levy-paying-employers

Employing an Apprentice - https://www.gov.uk/take-on-an-apprentice

Find Apprenticeship Training - https://findapprenticeshiptraining.apprenticeships.education.gov.uk   

Apprenticeship Funding Rules - https://www.gov.uk/guidance/apprenticeship-funding-rules

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