Top
Health and Safety Consultants / Apprenticeship Levy?  / What is the Apprenticeship Levy?
Apprenticeship-Levy-is-poor-value-for-money-think-tank
22 Feb

What is the Apprenticeship Levy?

What is the Apprenticeship Levy?

Employers with an annual pay bill of more than £3 million will be required to spend 0.5 per cent of the total on the levy.

Sounds simple enough; however, the Government is also introducing a ‘levy allowance’ of £15,000 per year, which will be subtracted from the 0.5 per cent total.

While the levy is being introduced in April, payments are set to start in May 2017 and it will be up to employers to notify HMRC each month as to whether they are eligible to pay.

 

Who is likely to be affected

This will affect employers in all sectors. The levy will only be paid on annual pay bills in excess of £3 million, and so less than 2% of UK employers will pay it.

 

What happens next for employers?

As soon as employers In England have registered and paid the levy, they will be able to access funding through a digital apprenticeship service account.

This will allow them to select and pay Government-approved training providers and post apprenticeship vacancies.

Initially, the service will only be available to businesses paying the levy, but the plan is to give all employers access to the digital account by 2020.

In addition to the amount paid into the account, the Government will apply a 10 per cent top up on funds, meaning that for every £1 paid in, the employer gets £1.10 to spend.

Businesses will have 24 months to spend their funds (‘vouchers’) before they expire.

It’s worth noting here that the digital apprenticeship service will only apply to businesses in England. Separate measures will be in place for Scotland, Wales and Northern Ireland.

 

What does ‘Government-approved’ provider mean?

The Government has opened a new register of apprenticeship training providers. These training providers will have to pass quality and financial tests to make sure standards are consistent and precise. Those with an inadequate Ofsted rating will not feature on the register.

Find out more about the Apprenticeship Levy

Find Out More
Health and safety guide

Download our free SME's Guide to Health And Safety.

Download Our Free Guide
Post Tags: