How are Apprenticeships Funded?

Employers can collaborate with a qualified training provider to provide the apprenticeship program’s training, as well as with an assessment provider to conduct the program’s end-point evaluation.

While the employer pays the apprentice’s salary, financing for training and assessment providers varies depending on whether the business pays a levy or not.

Funding when you’re a levy-paying employer

If you meet the requirements to be a levy-paying employer, your levy taxation rate will be 0.5% of your annual pay bill. Your digital account for the Apprenticeship Service will accumulate these funds. The fees of engaging a training provider can then be covered by logging in and using those monies. Then the government will add another 10% of your entire accumulated funds.

Funding when you’re a non-levy paying employer

You will be required to contribute 5% toward the expenses of training and End-point Assessment if your company doesn’t pay a levy and doesn’t have a wage bill above £3 million; the government will cover the remaining costs.

The government will pay 100% of the provider expenses for apprentices aged 16 to 18 or those aged 19 to 24 who have been under their local authority’s care if your company has less than 50 employees overall.

It’s important to note that the government has established 30 funding bands for apprenticeships. These serve as the maximum amount the government will contribute toward a standard that falls within a particular band. Employers who do not pay a levy should be aware that they will be responsible for the balance of a program’s costs if those costs go over the top limit of that band.