With the Levy changes coming into effect on the 6th April we have covered some of the key questions you may have.
What is the Apprenticeship Levy?
The Apprenticeship Levy is at the heart of the government’s agenda to vocational education and is being introduced to fund the 3 million new apprenticeships pledged by 2020.
When will the Apprenticeship Levy be introduced?
The levy will take effect from 6th April 2017, in order to fund new apprenticeships from 1st May 2017.
How will the Levy affect training?
Vocational training is changing placing the company who receives the training in control. With the new reforms, you can choose your training provider, you are assured that you are getting the value on your investment, driving the content and quality of the new standards and ensure that at the end of the apprenticeship your apprentice is competent in the role that you need them to do.
Who will have to pay the Apprenticeship Levy?
Employers with a total wage bill in excess of £3m will be required to pay the levy.
How is the Apprenticeship Levy calculated?
The levy is paid through PAYE every month and will be a 0.5% tax of the company’s total wage bill, after an allowance of £15,000.
Do the Government contribute anything to my Apprenticeship Training?
The Government will contribute a 10% top-up to the funds that are deposited in your levy account. The top-up funds will be deposited at the same time the levy payments enter your apprenticeship service account each month.
My company doesn’t meet the £3m pay bill threshold. What does the Apprenticeship Levy mean for me?
As a firm with a pay bill below £3m, and therefore not contributing to the levy, the Government will contribute 90% of the training costs of your apprentices; you will be required to fund the remaining 10%. This also applies to levy payers whose levy funds have run out.
Will the Apprenticeship Levy affect our current apprentices?
The levy will not affect the way that you fund training for your apprentices who started their programme before 1st May 2017. You will need to carry on funding these apprentices under the terms and conditions that were in place at the time in which the apprenticeship started.
If you are interested in up-skilling your team or hiring an apprenticeship before the Levy comes into action and it is 100% funded, fill in our contact form here.