The government Apprenticeship levy is a tax paid by employers. It is then stored in a fund which can be accessed to help pay for apprenticeship training costs.
Levy payers
- All organisations with a wage bill of £3m or over must pay the equivalent of 0.5% of their wage bill into the apprenticeship levy.
Every organisation that pays into the levy also receive funding from the apprenticeship levy, based on their headcount.
Levy contributions appear in their digital account (DAS) which then can be used by employers to arrange and pay for apprenticeship training. The funds can only be spent on training cost or End-point Assessment and are transferred to a training provider via DAS.
Non-levy payers
- employers with a payroll under £3 million per year don’t pay into a ‘levy-pot’ and are therefore a non-levy payers.
They can access the apprenticeship levy either via a reservation or levy transfer:
A) Reservation - The government will fund 95% of the course fees and the remaining 5% will be paid by the employer at a monthly rate for the duration of the apprenticeship.
B) Transfer of Levy - Levy transfers are unused levy allocations gifted by organisations and pay 100% of the funding band.
How do you access government funding?
To access and use the government Apprenticeship funding, employers will need to create an Apprenticeships service account (DAS).This is a government online service that allows employers to set up and manage Apprenticeships and here they can reserve Apprenticeship funding.