Apprenticeship Levy
What can the Levy be spent on?
The money will be collected by HMRC and for Apprenticeship training in England will be accessed via a Digital Apprenticeship Service (DAS) account.
You can spend your levy funds on apprentice training for either existing staff or new recruits as long as the training meets an approved standard or framework and the individual meets the apprentice eligibility criteria.
What is the Apprenticeship Levy?
The Apprenticeship levy is part of the government’s plan to increase the quantity and quality of Apprenticeships. The levy came into effect in April 2017 with the aim of funding three million new Apprenticeships in England by 2020.
Do I have to pay the Levy?
If you are a UK employer with a total employee pay bill above £3m a year then you have to pay the levy. This applies to all sectors. The Levy rate is set at 0.5% of your pay bill. Your "pay bill" is your total employee earnings subject to Class 1 secondary NIC's. You will get a £15,000 fixed annual allowance to offset against the levy payment and employers who operate multiple payrolls will only be able to claim one allowance for the levy.
Example:
If you have a £3m pay bill, you would have a levy bill of £15,000 (at 0.5% of employer pay bill). The allowance is offset against this so your levy payment is £0.00
Apprenticeship Funding
Funds can only be used towards the costs of Apprenticeship training. They cannot be used on other associated costs.
Employers not paying the levy, who offer apprenticeships to 16 - 18 year olds, will receive 100% of the cost of training from the Government.
Employers hiring apprentices aged over 19 will pay 5% of the costs of apprenticeship training and the Government will pay the remaining 95%.