We need to make sure people of all ages and backgrounds have a chance to get on in life. Apprenticeships give young people – especially those from disadvantaged backgrounds – a ladder of ‎opportunity. That’s why we continue to work tirelessly to deliver the skills our country needs. The apprenticeship levy is absolutely crucial to this.

– Apprenticeships & Skills Minister Robert Halfon

In spring 2017 the way the government funds apprenticeships in England is changing. Some employers will be required to contribute to a new apprenticeship levy, and there will be changes to the funding for apprenticeship training for all employers.

The apprenticeship levy requires all employers operating in the UK, with a pay bill over £3 million each year, to make an investment in apprenticeships. You can benefit from this investment by training apprentices.

The apprenticeship programme has already given 2.9 million people the chance to learn new skills so they can go on to access fulfilling careers and help boost UK business.

Each employer will have an annual allowance of £15,000, which will be offset against the levy. In effect, only employers with a paybill of more than £3 million will be liable to pay the levy (because 0.5% of £3 million is £15,000). Companies and charities that are connected in a group structure will have one £15,000 allowance to share between the group.

The levy will be paid through PAYE on a monthly basis. The allowance will also be applied on a monthly basis and any unused allowance can be carried forward to the next month.

Under the plans for the levy, the government has proposed that employers that are too small to pay the levy – around 98% of employers in England – will have 90% of the costs of training paid for by the government, reassuring millions of small businesses.

There is expected to be more news released later this month (October 2016) about the Apprenticeship Levy and we will endeavour to keep you informed on any new developments.

The Tess Group, as an award-winning apprenticeship provider, will always assist any employer looking into the learning and development of their staff. If you want to know how the Apprenticeship Levy could affect you, please get in touch for more information.

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