Apprenticeship Levy FAQ

Read our most popular FAQs answered by the experts at the Apprenticeship College

What is the Apprenticeship Levy ?

Announced in 2015, the Apprenticeship Levy aims to fund three million apprenticeships in the UK by 2020. It affects all organisations with an annual payroll of £3m or more. It’s a new tax used to enable employers to fund training.

What will it cost ?

The basic charge is 0.5% of your PAYE bill. However, employers will not pay the first £15k of the Levy.

What is Government Co-funding ?

Government co-funding is centralised budget for apprenticeship training. If you are not a levied employer the co-funding from Government will pay 95% of apprenticeship training costs for you.

But co-funding is also available to employers who are levied but who want to train more apprentices that can be funded by their own levied funds.

Does the Apprenticeship Levy affect my organisation?

If your payroll comes to over £3m a year, the answer is yes, regardless of what kind of employer you are.

Are any employers exempt ?


Can I use the apprenticeship levy to fund my Learning and Development programme ?

Yes, provided that your training provider is approved and registered on the new Register of Apprenticeship Training Providers (RoATP) and works with you to develop an L&D programme based on apprenticeships standards and/or frameworks.

Is the Public Sector exempt ?

No – the Apprenticeship Levy applies to all employers. There are additional targets set for the public sector. So as well as paying the Levy you are obliged to ensure that 2.3% of your workforce are undertaking apprenticeship training.

What is the aim of the Apprenticeship Levy ?

The main aim is to persuade you to take on more apprentices. They can be from new, as junior employees, but you can also retrain current employees to take the next step on their career ladder, or to change direction.

In the end, the Apprenticeship Levy is designed to so that employers are encouraged to up-skill staff and become more productive and competitive.

Do I have to employ new staff to recover the money I've paid into the Levy ?

No. You can use the funds that you have paid into the Apprenticeship Levy to train any of your employees. That includes juniors and new entrants but also team leaders, supervisors and people in managerial posts.

So apprenticeships aren't what they used to be then ?

No. As well as the introduction of the Levy, apprenticeships have been reformed in lots of ways. Anybody can be an apprentice. Apprenticeships include everything from GCSE level courses all the way up to post graduate courses. From 2018 you’ll even be able to complete an MBA as part of the apprenticeship programme.

Has government stopped paying for apprenticeships ?

No, they will still ‘co-fund’ apprentices and pick up the bill for 90% of training costs if you are either:

a). too small to be levied

b). you’ve spent all of your Levy and want to train more apprentices


How do we get started ?

or call on 020 3651 4747 and we’ll arrange to brief you fully.