Call Us: 01254 389933
Apply Now

Apprenticeship Levy

Find a Course

Apprenticeship Levy

What is the Apprenticeship Levy?

In the 2015 Autumn Statement, the UK Government outlined plans to increase apprenticeship participation to 3 million by 2020 by making changes to funding and introducing an apprenticeship levy.

It affects all organisations who’s payroll is above £3million, committing them to paying a percentage fee of their PAYE wage bill.

The facts…

  • The apprenticeship levy is for large employers who have an annual payroll in excess of £3m, the first payments were due in April 2017 at a rate of 0.5% paid through Pay as You Earn.
  • The levy will apply to employers across all sectors regardless of whether or not they employ apprentices.
  • All employers will receive an allowance of £15,000 to offset against payment of the levy. This will then be placed into a digital account that can only be used to purchase apprenticeship training from recognised providers.
  • Apprenticeship training can either be paid for new recruits or existing staff.
  • Employers who pay the levy and are committed to apprenticeship training will be able to get more than they pay into the levy through a top up to their digital accounts.
  • The levy will need to be paid by larger organisations regardless of whether they reclaim funds to purchase apprenticeship.
  • Smaller companies can still take advantage of available Government funding, which may include an employer contribution.

How can we help?

In response to a number of enquiries Accrington and Rossendale College has set up a Levy Solution Service that supports employers to maximise the return on investment of the levy.

What the Levy Solution Service offers

  • Advice and guidance clinics
  • Training needs analysis
  • Workforce planning support
  • Recruitment service for new apprentices
  • Apprenticeship Training Agency
  • Upskilling and reskilling service for existing staff using apprenticeship frameworks and standards.

Training options available

  • Talent pool programme
  • Apprenticeships for new employees
  • Apprenticeship funding used to develop and upskill existing staff
  • Programmes for all ages
  • Development of core skills such as English and Maths

What can be achieved?

  • Recruitment programmes for new employees using apprenticeships
  • Staff development of existing staff using apprenticeship funding
  • Maximise your return on investment

Setting up your levy account

  • To set up your levy account please got to:
  • You will need your Government Gateway login details for the PAYE scheme that you want to include in your account (your finance/payroll department should have this).
  • Once you have declared your levy for April 17 you will see the balance in your account and you must “sign” the agreement in order for you to access the funds.
  • You must add any apprentices to your account or your training provider will not get paid.

Levy payment example:

Employer of 250 employees, each with a gross salary of £20,000

  1. Pay bill: 250 x £20,000 = £5,000,000
  2. Levy Sum: 0.5% x £5,000,000 = £25,000
  3. Less allowance of £15,000 = £10,000
  4. 10% Government contribution = £1,000
  5. Levy payment by employer = £10,000

Total levy pot = £11,000

How much will you have to pay for an apprentice?

Due to changes to how the government funds apprenticeships means the cost of an apprenticeship will depend on the age of your apprentice, the size of your company and the qualification:

Company Size

16 – 18 Apprentice (16 – 24 with a care plan)

19+ Apprentice

Small (under 50 employees)


10% contribution

Medium (over 51)

10% contribution

10% contribution

Annual Payroll over 3 million (Levy paying)



Different apprenticeship qualifications have different funding values and we will discuss this with you at enquiry.

Upcoming Events