Levy – Estimate your Apprenticeship Funding

Estimate your apprenticeship funding.

Use this tool to estimate if your organisation will pay the apprenticeship levy, how much your organisation will have available to spend on apprenticeships and how much the government will contribute towards the cost of training.

You’ll need to know your organisation’s annual UK payroll

It would also help if you know:

  • the percentage of your workforce that live in England
  • the type of apprenticeship training you will need

This is a new service – your feedback will help The Department for Education to improve it.

The levy will put control of apprenticeship funding in the hands of employers and will encourage employers to invest in their apprentices and take on more.

Here are the key facts:

  • From 05 April 2017, employers with a paybill over £3 million will be charged a levy of 0.5% of their paybill
  • ‘Paybill’ will be based on total employee earnings subject to Class 1 secondary NICs
  • The 0.5% levy is on your full UK payroll bill, not just the amount over £3m
  • The levy will be payable through Pay As You Earn (PAYE) and will be payable alongside income tax and National Insurance.
  • Payment will be taken monthly, in real time, meaning as your paybill changes each month, the levy amount taken will be reflected.
  • HMRC will work closely with employers and providers of payroll services to minimise the burden of implementing these changes.
  • Although the levy is calculated based on your full UK paybill, employers will only be able to only spend their English proportion on English apprenticeship training.
  • The levy payment will then be ring-fenced in the form of an electronic voucher that can be used to purchase training from recognised providers, from the end of May 2017 onwards. Un-used vouchers will expire after 18 months.
  • Employers in England who pay the levy and are committed to apprenticeship training will be able to get more out than they pay into the levy. The government will apply a 10% top-up to monthly funds i.e. all funds entering a levy payer’s account will be increased, so every £1 will be increased to £1.10 in value.
  • All employers with pay bills of over £3m will be required to pay the levy, regardless of whether they subsequently re-claim voucher funds to purchase apprenticeship training.
  • Based on current funding rules, the levy can be claimed back and spent on apprenticeship training for all employees at all levels and ages, including graduates who may be eligible for Level 6 or 7 apprenticeship programmes.
  • Based on current funding rules, the levy can be used to fund existing employee development as long as they meet the criteria set out.
  • Employers who pay into the levy may find that, over the course of an apprenticeship, the funds in their digital account aren’t enough to cover the full cost of the apprenticeship training and assessment they would like to buy. When this happens the government will support and help employers meet the additional costs. Employers will be asked to make a contribution to the extra cost of training and to pay this directly to the government or chosen provider, however this will be payable over the lifetime of the assisted apprenticeship.
  • It is estimated 3-5% of an employers workforce will need to be an apprentice to utilise the levy.




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