2019 – Changes to the apprenticeship funding system

The Government made changes to the way apprenticeship funding works in March this year.

  • introducing the apprenticeship levy
  • introducing the apprenticeship service – this is an online service that allows employers to choose and pay for apprenticeship training more easily
  • introducing a new ‘co-investment’ rate to support employers who don’t pay the levy(‘co-investment’ is when employers and government share the cost of training and assessing apprentices)

Apprenticeship Levy

If you’re an employer with a pay bill over £3 million each year, you must pay the apprenticeship levy from 6 April 2017. Read guidance on how to pay the apprenticeship levy.

You will report and pay your levy to HMRC through the PAYE process.

The levy will not affect the way you fund training for apprentices who started an apprenticeship programme before 1 May 2017. You’ll need to carry on funding training for these apprentices under the terms and conditions that were in place at the time the apprenticeship started.

Use the apprenticeship service

Register to use the service

If you are a levy-paying employer, you can now create an account on the apprenticeship service to:

  • receive levy funds for you to spend on apprenticeships
  • manage your apprentices
  • pay your training provider
  • stop or pause payments to your training provider

What you can buy with funds in your apprenticeship service account

You can only use funds in your account to pay for apprenticeship training and assessment for apprentices that work at least 50% of the time in England, and only up to the funding band maximum for that apprenticeship.

If the costs of training and assessment go over the funding band maximum, you will need to pay the difference with other funds from your own budget.

You can’t use funds in your account to pay for other costs associated with your apprentices (such as wages, statutory licences to practise, travel and subsidiary costs, work placement programmes or the setting up of an apprenticeship programme).

Read the apprenticeship funding rules for full details of what you can and can’t pay for with funds from your apprenticeship service account.

 

If you would like more information or help with apprenticeship funding please contact us and we will be happy to offer you free advice and guidance

Posted in Apprentice recruitment, Apprenticeships, Funding June 4, 2019