Funding and the levy

In April 2017, the Government introduced the apprenticeship levy. If you’re a UK employer with an annual payroll of more than £3m, you have to pay a levy which can only be used for the training and assessment of apprentices in your organisation.

Levy payer

As a levy payer you’ll fund your apprenticeships through your digital levy account. If the cost of the training is more than the money in your digital account you’ll need to top it up and the Government will contribute 90% of these extra costs.

Download our levy paying employer’s journey to apprenticeships.

Lori Barber-Field answers your questions about being a levy payer:

 

Levy fund transfer

Levy paying employers are currently able to transfer up to 10% of their levy funds to another employer. From April 2019 levy payers will be able to transfer up to 25% of their levy pot. The full Government guidance is available here.

A few key points:

  • The transfer is limited to 10% of the value in the Apprenticeship Service account (ie the English value plus the 10% top-up – so removing the proportion for Wales/Scotland and NI).
  • The funds can't be refunded once transferred.
  • The receiving employer has to enter the apprentices details and have an account on the apprenticeship service.
  • Transferred funds can ONLY be used to pay for apprenticeship standards.

The Education and Skills Funding Agency have created a useful video all about the apprenticeship levy transfer, providing information for organisations wanting to transfer their levy or organisations looking to receive transferred levy funds. Click here to watch the video.

For the latest update from the Education and Skills Funding Agency click here.

 

Non-levy payer

As a non-levy payer, you'll agree a price with the learning provider and then pay for 10% of the cost to your learning provider and the Government will contribute the rest of the cost and pay the learning provider. From April 2019 the amount that non-levy payers will need to pay for their apprenticeships will drop from 10% to 5%.

Download our non-levy paying employer’s journey for apprenticeships

Victoria Collier answers your questions about being a non-levy payer:

 

Funding – useful links and resources

For the most current funding information go to: www.gov.uk/government/collections/apprenticeship-changes

For the most current levy information: www.gov.uk/guidance/pay-apprenticeship-levy

You can find out more about the funding rules here.

Funding calculators 

There are some useful funding calculators that have been developed to help you work out costs for your organisation:

Official ESFA calculator

Funding apprenticeship system

 

Other available funding

Incentive payments

For all employers, there is also a system of incentive payments if:

  • you are a small organisation
  • employ 16-18 year olds
  • employ a care leaver
  • and also upon completion.

In some cases these incentive payments may be more than your original cash contribution.

Workforce Development Fund

The Workforce Development Fund (WDF) is funding from the Department of Health and Social Care which is disbursed by Skills for Care. It’s a limited pot of money which funds qualifications and learning programmes to support the continuing professional development of staff across adult social care in England.

You can claim from the WDF because the learner is required to complete a diploma as part of the apprenticeship standard.

Find out more here.