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The Apprenticeship Levy

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What is the Apprenticeship Levy?

The Apprenticeship Levy is a levy on UK employers to fund apprenticeships. The purpose of the Apprenticeship levy in England is to put the control of Apprenticeship funding in the hands of the employer, through the Apprenticeship Service.

Who does the Apprenticeship Levy apply too?

The levy applies to any UK employers who have an annual paybill of over £3 million. These employers then receive a £15,000 levy allowance per year, to offset against any levy they must pay. Should an employer have workforce both within and outside of the UK, the levy is only paid on workforce within the UK.

How do I pay my Apprenticeship Levy?

Once set-up with HMRC, the employer is required to make a monthly investment of 0.5% of the wage bill, through PAYE. Once the monthly levy has been paid, the government will provide a 10% top-up and funds for training will become available.

What can I use my Apprenticeship Levy funds for?

Levy funds can be used for Apprenticeship training, through providers who are successfully registered on the Register of Apprenticeship Training Providers (RoATP), such as APT. Speak to our Business Development Team today for further advice and guidance.

What if my organisation doesn’t pay the Apprenticeship Levy?

If an employer’s annual wage bill is less than £3 million, they will not pay the Apprenticeship Levy and will be eligible to receive government support. Dependent on criteria of the apprentice and employer, an employer will be required to contribute 5% of the Apprenticeship price.

Incentive payments for all employers who hire new apprentices

The cash bonus scheme for hiring apprentices aged 25 and over will double to £3,000 and will be extended by six months from 1st April 2021.  The current scheme ends in March, but the chancellor has new plans which have been unveiled in his budget to extend it until September 2021.

From April 1st 2021, the government incentives will become more generous with a £3,000 payment per hire, regardless of the apprentice’s age.

This incentive is on top of the £1,000 payment provided for new apprentices aged 16 to 18 and those under 25 with an Education, Health and Care Plan, meaning that some employers will receive £4,000 in total.

If an employer has less than 50 employees and recruits a 16-18 year-old apprentice, they will also be entitled to 100% government funding.

New Funding Guidance
June 20

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