Apprenticeship Levy 2017 – Are you Ready?
The Apprenticeship Levy is almost here; set to come into place on 6th April 2017 the Apprenticeship Levy will require employers with a payroll bill of over £3 million per year to pay a levy charged at a rate of 0.5% of their annual payroll bill. This will be paid through HRMC’s Pay as You Earn (PAYE) process.
Levy Paying Employers
If you are a levy paying employer, tools are available for you to use on the Gov.uk website to receive your levy funds, manage your apprentices and manage payments to your training providers. These tools can be accessed here; https://www.gov.uk/guidance/manage-apprenticeship-funds
To spend the funds in your account you need to;
1) Choose your Apprenticeship
There are 2 different types of Apprenticeship available
- Apprenticeship Standards – Covering a specific occupation and sets out the core skills, knowledge and behaviours.
- Apprenticeship Frameworks – Work-related vocational and professional qualifications.
2) Choose your Training Provider
- Use the Find Apprenticeship Training service (https://findapprenticeshiptraining.sfa.bis.gov.uk/) to select an approved training provider.
3) Agree a Price and Payment Schedule
You will need to agree a full cost of training with your provider for each Apprenticeship being delivered, which will include the cost of training and assessment.
4) Pay for training and assessment with funds through your Apprenticeship Service account
Once training has started, monthly payments will be sent to your chosen training provider. If you do not have enough funds in your account to cover the cost of training, you will be asked to share the remaining cost of training.
With ‘co-investment’, you will pay 10% of the outstanding balance for that month, and the government will pay the remaining 90% up to the funding band maximum. If your costs go over the maximum, then you must pay the difference out of your own budget.
More Information can be found here: https://www.gov.uk/government/publications/apprenticeship-levy-how-it-will-work/apprenticeship-levy-how-it-will-work#pay-apprenticeship-levy
Non-Levy Paying Employers
Non-levy paying employers will share the cost of training their Apprentices with the government. From May 2017, non-levy paying employers will contribute 10% towards the total cost of Apprenticeship training and the government will fund the rest (90%), up to the maximum funding banding.
If you do not pay the Apprenticeship levy you won’t be able to use the new Apprenticeship service immediately to manage your Apprenticeship training. You will need to contact your preferred training provider directly and set up a payment schedule to them directly for your contributions to training costs.
To deliver Apprenticeships in your workplace;
1) Choose your Apprenticeship
There are 2 different types of Apprenticeship available
- Apprenticeship Standards – Covering a specific occupation and sets out the core skills, knowledge and behaviours.
- Apprenticeship Frameworks – Work-related vocational and professional qualifications.
2) Choose your Training Provider
- Use the Find Apprenticeship Training service (https://findapprenticeshiptraining.sfa.bis.gov.uk/) to select an approved training provider.
3) Agree Payment Schedule
You will need to agree payment schedule for the 10% contribution of training.
4) Pay for training and assessment directly with your selected training provider
Set up payments with your training provider directly.
Further Information
The SFA have a helpline open for those with questions RE the Apprenticeship Levy and the changes set to come into effect in the coming months;
Apprenticeship Employer Helpline
Email; [email protected]
Telephone; 08000 150 600
For more information on the Apprenticeship Levy, please contact your Approved Training Provider of Choice or go to: https://www.gov.uk/government/publications/apprenticeship-levy-how-it-will-work/apprenticeship-levy-how-it-will-work