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06 September 2016

Guidance on how the apprenticeship levy will work

On 6 April 2017, the way in which apprenticeships in England are funded is changing. Some employers will be required to pay a new apprenticeship levy, and there will be changes to the funding for apprenticeship training for all employers.

The levy will apply to employers across all sectors. It will be set at a rate of 0.5 per cent of an employer's wage bill, excluding other payments such as benefits in kind, and will be collected via the PAYE system. Employers will receive an annual allowance of £15,000 to be offset against the levy payment. The effect of this allowance is that the levy will only be payable by employers with wage bills in excess of £3,000,000 (estimated as fewer than 2 per cent of employers). Those with a lower wage bill will not pay anything.

The Government has published guidance providing information on how the apprenticeship levy will work and explains the principles on which apprenticeship funding and the levy will operate. The topics covered are:

  • Paying the apprenticeship levy;
  • Accessing money paid under the scheme;
  • Buying apprenticeship training;
  • Information for all employers on what apprenticeship funding can be spent on; and
  • Eligibility for training.

The guidance, which can be found here, also gives the dates on which further information will be made available.

For more information or advice please contact Jo Davis in the employment team. Call 01753 279029 or email employmentlaw@bpcollins.co.uk.

Stay in touch

Phone: +44 (0) 1753 889995

Email: enquiries@bpcollins.co.uk

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