The Apprenticeship Levy

The facts

As an employer with a pay bill of more than £3 million, you're required to pay the apprenticeship levy. You'll receive funds through the apprenticeship service to spend on training and assessing your apprentices.

You'll need to pay the apprentice's salary, which will be at least the hourly minimum wage rate for their circumstances.

Apprenticeship funding from the government

The amount of funding entering your account each month is calculated as follows:

The levy you declare to HMRC through the PAYE process is multiplied by the proportion of your bill paid to your workforce who live in England, plus a 10% government top-up on this amount

When you're ready to get started, you'll need to sign in or create an account on the apprenticeship service.

Sharing apprenticeship costs with the government

If you have at least 50 employees or your apprentice does not meet the criteria above, you'll share apprenticeship costs with the government. This means:

You'll pay 5% towards the cost of training and assessing your apprentice, the government will pay the remaining 95% up to the funding band maximum, and if your apprentice's training and assessment cost more than this, you'll pay the difference.

Training young apprentices

All employers will receive £1,000 if, at the start of the apprenticeship, the apprentice is:

  • Between 16 and 18 years old (or 15 years old if the apprentice's 16th birthday is between the last Friday of June and 31 August)
  • Between 19 and 24 years old and has either an Education, Health and Care (EHC) plan provided by their local authority or has been in the care of their local authority

This will be paid to you in two equal instalments, 3 months, and 12 months into the apprenticeship, through your training provider.

Last modified: Wednesday, 28 October 2020, 9:15 AM