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Apprenticeships & the Levy

When does the Levy begin?

Since April 2017 all employers have to pay for Apprenticeships either through the Apprenticeship Levy or through a co-investment cash contribution.

Who pays the Levy?

Employers with a payroll in excess of £3 million will pay the levy

What is the Levy rate?

Employers with an annual pay bill of more than £3 million will pay 0.5% of their total pay bill into the apprenticeship levy.

What is the Levy allowance?

A Levy allowance of £15,000 per year has been introduced. This means the total annual bill payable will be 0.5% of your wage bill, minus £15,000.

How do I pay the Levy?

You pay through your PAYE portal to the HMRC

How do employers reclaim the funds?

Employers paying the levy will need to hire apprentices to claim back their tax in a form of digital vouchers.

What can I spend my Levy funds on?

The Levy can only be spent on apprenticeship training and assessment with approved training providers. This can be for both new and existing staff.

How do I access my Levy fund?

Funds can be accessed through a Digital Apprenticeship Service Account.

Will my funds expire if I don’t use them?

Funds will expire 24 months after they enter your digital account unless you spend them on apprenticeship training.

How do the top ups work?

The government will apply a 10% top up to the fund you have for spending on apprenticeship training in England.

What happens if our payroll is less than £3m?

If you are an employer with an annual payroll of less than £3m then you won’t pay into the levy.

How do we pay for Apprenticeship Training?

You will pay your approved provider directly for Apprenticeship training.

How much will it cost?

Non-levy payers will co-invest towards Apprenticeship training by contributing 10% towards the cost and the Government will pay 90%.

For employers with less than 50 employees, the Government has proposed to waive the co-investment element if these employers take on a 16-18 year old apprentice – the cost of training a young person will be free.

Learning & Enterprise College Bexley

We can help you to maximise the benefit an apprentice can bring to your business, help find the right recruits and are an approved training provider.