Apprenticeship Levy Transfers
Skill Up Somerset are working with some local large employers who are willing to transfer their levy to smaller local employers, subject to certain criteria.
The Apprenticeship Levy allows employers to have control of their workforce training. You report and pay your levy to HMRC through the PAYE process.
- An extra 10% is paid directly to employers’ apprenticeship accounts.
- Employers can spend the levy on Apprenticeship training in England.
The apprenticeship levy was created to create long-term sustainable funding for apprenticeships and give employers more control to provide their staff with various training opportunities.
Could your small business benefit from financial support from an Apprenticeship levy transfer?
This means no training costs for your Apprentice when a 5% employer contribution may be required.
Are you a larger employer that could transfer your apprentice levy to help a smaller business?
Skill Up Somerset are working with some local large employers who are willing to transfer their unspent levy to smaller local employers, subject to certain criteria.
What is the Apprenticeship Levy?
If you’re an employer with a pay bill over £3m you will need to pay the Apprenticeship Levy. The levy will be charged at a rate of 0.5% of an employer’s pay bill, and is paid to the HMRC through the PAYE process. An extra 10% is then paid directly to employers’ apprenticeship accounts by the Government.
The apprenticeship levy was created to create long-term sustainable funding for apprenticeships and give employers more control to provide their staff with various training opportunities. It can be used for existing members of staff starting an apprenticeship. Any unspent levy funds are recouped by the Government after 24 months.
Some of the unspent funds can be transferred to a SME to cover the training costs of an Apprentice. The Levy transfer funds cover the cost of the training for the apprenticeship only, not wages or any other employment costs.
Non-levy employers (employers with a PAYE bill of less than £3m) – Employers pay 5% towards the cost of training and assessing the apprentice, and the Government pay the remaining 95% up to the funding band maximum.
Employers with fewer than 50 people working for them will not have to pay the 5% contribution for an apprentice who is aged between 16-18 years old, or a 19-24 years old and who has previously been in care or who has an Education, Health and Care plan provided by their Local Authority. The Government will pay 100% of the training costs for these individuals.
What is a levy transfer?
- Levy paying employers can transfer up to 25% of their levy funds to other employers. This can help smaller businesses to invest in apprenticeship training opportunities.
- The amount transferred must cover 100% of the cost of the apprenticeship.
- Employers receiving transferred funds will only be able to use these funds to pay for new apprenticeship starts.
- A transfer must be agreed and put in place before the apprentice starts their apprenticeship.
How can I transfer my unused Levy funds?
If you have a pay bill over 3 million you will need to pay the apprenticeship levy, and will have funds to spend on Apprenticeship training and assessment.
If you have unused apprenticeship funds you can find employers who want to receive a transfer. This could be businesses, within your local area, sector or supply chain, a charity, business partners etc.
- only levy-paying employers can make a transfer
- any employer can receive and use transferred funds
- you both have to be registered on the apprenticeship service
- transfers can only be used for new starts,
- you can’t transfer funds to another employer if you currently receive a transfer
- the Levy transfer funds cover the cost of the training for the apprenticeship only, not wages or any other employment costs
Why transfer my unused levy funds?
- support your supply chain
- support businesses that share your values
- support businesses within your sector
- support your corporate and social responsibility
- Supporting the Somerset economy in recovery
- building strategic partnerships
How can I receive a transfer?
If you are interested in finding an employer who can transfer levy funds to you, please get in touch with us: Contact us
- if the apprenticeship stops, then the funding will stop too
- you won’t have to pay any funds back to the sending employer
- if a training provider transfers funds to you, they cannot deliver the training for that funded apprenticeship
- if the amount transferred does not cover the total amount, you will need to pay 5% of the training costs.
- The Levy transfer funds cover the cost of the training for the apprenticeship only, not wages or any other employment costs.
Benefits of receiving a Levy Transfer
- grow training opportunities
- build relationships
- in the UK, the levy applies to employers across all sectors, including local authorities
Apprenticeship Levy Facts
- The levy funding has helped directly support almost 50% of all apprenticeships in 2017/18. [Gov.UK]
- Since it was introduced the levy has directly supported almost 313,000 people to start their apprenticeship journey. [Gov.uk]