How does apprenticeship funding work

The apprenticeship levy can only be used within England, as apprenticeship legislation differs across the devolved nations. The amount of levy you can access is directly linked to the proportion of your employees living in England.

Non-levy paying employers can use the levy through a transfer of funds from a levy paying employer. If a levy paying company runs out of funding in their account, the co-investment option is available for them too.

Non-levy payers are able to reserve a maximum of 10 apprenticeship starts a year. The account is used to manage levy funding, track apprentices, find training providers, or transfer unused funds. Any levy funds expire after 24 months, so it is vital to utilise your levy as soon as possible. Once a programme and training provider has been selected and a price agreed, your provider will be paid out of your digital account every month.

Apprenticeship levy rules state that your levy must only be used to pay for apprenticeship training and End-point Assessment, and cannot be used to pay apprentice wages. There are a few apprenticeship levy rules to keep in mind when using the apprenticeship levy to make sure your funds are used correctly. Your funds will expire 24 months after the date submitted, at which point unused funds will default back to the government. This is to incentivise regular expenditure on high-quality apprenticeship training.

When paying for apprenticeship training, the government will always use the oldest funds in your account first to minimise the window for fund expiry. Standards are created by groups of employers and define the knowledge, skills and behaviours required to carry out a job role. A full list of all standards, including those in development, is available via this link. Each standard is assigned a funding band that sets the maximum amount of apprenticeship funding that an employer can invest in an individual apprenticeship.

Apprenticeship training providers and employers can agree higher or lower rates, but costs that surpass the upper limit must be paid for directly by the employer, instead of via their apprenticeship service account. Each standard has an assessment plan which sets out how each apprentice will be independently assessed at the end of their training to determine whether they have reached occupational competence. Scotland Wales Northern Ireland. These policy papers set out how the government funds apprenticeships in England, dating back to reforms that were introduced in May Each paper explains the apprenticeship funding policy that applies to apprentices that started after a specific date.

Read the latest apprenticeship funding guidance. Read the latest apprenticeship funding rules. Updated 'Apprenticeship funding in England from November '. Updated 'Apprenticeship funding in England from August '. Added 'Apprenticeship funding in England from August '. We've added the new document: apprenticeship funding for employers who do not pay the apprenticeship levy.

This outlines changes to the way employers who do not pay the levy arrange their apprenticeships. You and your training provider must agree a total price for each apprenticeship, which includes the costs of training and assessment. For standards this must include the cost of the end-point assessment agreed with the apprentice assessment organisation. You will see funds entering your account each month after you have declared the levy to HMRC, and funds leaving the account each month as you pay for training.

If your costs go over the maximum, then you must pay the difference out of your own budget. If you are in a group of companies paying the levy together, your group can already set up a single shared apprenticeship account and pool your funds. Read more about how to register connected organisations.

Levy payers can support apprenticeships in other organisations by transferring a percentage of their apprenticeship funds to other employers. These funds can be transferred to any employer, including smaller employers in their supply chain, and Apprenticeship Training Agencies ATAs , to support new opportunities and widen participation in apprenticeships. Levy-paying employers who wish to transfer funds will have to agree the individual apprenticeships that will be funded by a transfer with the employer receiving the funds.

Employers receiving transferred funds will only be able to use them to pay for training and assessment for apprenticeship standards. Transferred funds cannot be used to pay for training and assessment for apprenticeship frameworks. Read more about how transferring apprenticeship service funds will work.

Employers need to take account of state aid rules when receiving funds from other organisations. A percentage of all the funds you receive as a transfer may be considered as state aid.