›News›Apprenticeship Levy Launches For Employers

Apprenticeship levy launches for employers

24/04/2017
Electronics Apprentice

The government has introduced a set of changes to the way apprenticeships are funded, impacting on all employers looking to employ and train an apprentice.

These changes include:

  • introducing the apprenticeship levy

  • introducing the apprenticeship service - this is an online service that allows employers to choose and pay for apprenticeship training more easily

  • introducing a new ‘co-investment’ rate to support employers who don’t pay the levy (‘co-investment’ is when employers and government share the cost of training and assessing apprentices)

 

It is important to fully understand where your business requirements fit into the new scheme and how it will affect the funding and training of your future apprentices.

Depending on the size of your business, the apprenticeship levy will affect you in different ways.

A summary of the key points of the apprenticeship levy are outline below.

  • All employers with a payroll bill of over £3 million will be taxed 0.5% on that bill from 6th April 2017.
  • The levy you pay will automatically be determined by HMRC’s Real Time Information and calculated on all employee earnings.
  • There is a £15,000 funding allowance per year - this applies to all businesses whether you have a payroll of more or less than £3 million.
  • Employers that do not pay the levy must contribute 10% of funding towards the cost their apprenticeship training.
  • The funding amount will be transferred to a digital account specifically for your business and made available from 1st May 2017.
  • You will have up to 24 months to spend the amount accumulated in your digital account.
  • Your funding can only be spent on accredited apprenticeship programmes.

The apprenticeship levy scheme is a fantastic opportunity for businesses to obtain additional funding to train and grow apprentices within their business. However, for those not familiar with the new scheme or process, it can seem quite daunting and overwhelming.

Find out more

To find out how to pay the apprenticeship levy and how to use the apprenticeship service please visit the governments website and read the guides that downloadable on this page.