Employers with an annual wage bill of £3million or above are classed as levy-paying businesses and will use the Digital Apprenticeship Service (AS) to access their apprenticeship levy funds and choose the correct apprenticeship standard and training provider.
The AS puts employers in control, allowing them to access funding for apprenticeship training. Employers will be able to see what funds are available, estimate how much a chosen apprenticeship will cost over time and pay training providers.
All levy-paying businesses:
- Are charged 0.5% of their wage bill including all earnings that are subject to class 1 National Insurance contributions.
- Will be allocated a £15,000 Levy Allowance, so the business will pay 0.5% of their wage bill minus £15,000.
- Will have a 10% top-up to the fund deposited into your apprenticeship service account by the government.
- Will be offered an incentive payment of £1,000 for employing an apprentice aged 16-18.
- Will pay the levy directly to HMRC through the PAYE process.
- Will have their funds credited into the Digital Apprenticeship Scheme (AS).
How to create an account
- Find out if your business will need to pay the Apprenticeship Levy by visiting this page: https://www.apprenticeships.gov.uk/employers/funding-an-apprenticeship#
- If you are a levy-paying business, you will need your company’s Government Gateway user ID and password (your payroll or finance department should have this information). If your company has a payroll agent, don’t use the agent’s login details, instead you will need to set up a Government Gateway account.
- Go to the Apprenticeship Service website and follow the steps on-screen to create your account.
- Start using your own account. You can sign your employer agreement, find suitable apprenticeship standards, search for and pay your apprenticeship training provider and recruit an apprentice. You can set up other users, view payments you’ve made to your apprenticeship training provider and see your balance.
More information about the AS can be found on the www.gov.uk website
What happens if I’m not paying the apprenticeship levy?
Businesses with a wage bill under £3million are classed as non-levy paying and will:
- Be required to pay 10% towards the cost of training, the government will pay the remaining 90%.
- Be offered an incentive payment of £1,000 for employing an apprentice aged 16-18. If you have less than 50 employees then you may qualify for fully funded apprentices (aged 16-18).
- Need to agree a payment schedule with your chosen training provider and pay them directly for the training. Visit www.gov.uk for more information.
Remember, you can use your apprenticeship levy contributions to pay for apprenticeship training for new and existing employees.
We currently offer over 70 apprenticeship pathways.
To discuss how we can help you to maximise your return on investment contact the Business Development Team:
Telephone: 01226 216 166
Last updated: 18th May 2023