Using your apprenticeship levy
If your pay bill is over £3 million, you must pay the apprenticeship levy. You can manage these funds using the apprenticeship service to train and assess your apprentices. The government adds a 10% top-up to your account funds.
If your funds run out, you pay only 5% of the remaining costs, and the government covers the rest, up to the funding band maximum for each apprenticeship. For apprenticeships that started before 1 April 2019, you must contribute 10%.
If you exceed the funding band maximum, you pay the extra costs.
Set up your account: Learn how to set up an apprenticeship service account as an employer.
Paying your apprentice
You must pay your apprentice for their working hours and any training as part of the apprenticeship. Pay them at least the National Minimum Wage based on their age and apprenticeship year.
Paying employer National Insurance contributions
You might not need to pay Class 1 National Insurance contributions for an apprentice if they:
- Are under 25 years old
- Are on an approved UK government apprenticeship standard or framework
- Earn less than £967 a week (£50,270 a year)
The apprentice still pays Class 1 National Insurance contributions through their salary. This exemption only benefits the employer.
More info: Read HMRC's guidance on paying National Insurance contributions.
Support small businesses by transferring your unused levy funds
Use your apprenticeship service account to transfer up to 50% of your unused levy funds to other businesses. This helps them cover apprenticeship training and assessment costs, up to the funding band maximum.
When you create a pledge, you decide how much funding to offer for the financial year and choose which businesses to support based on their sector, skills, or location. Your pledge will be advertised on our public website so businesses can apply for a transfer of funds.
Note: When you agree to a transfer, you commit to funding the apprenticeship for its entire duration, which might span several financial years.
Find businesses to support by:
- Working with employers in your supply chain
- Contacting employers in your industry
- Reaching out to a Flexi-Job Apprenticeship Agency (FJAA)
- Partnering with regional organisations
The benefits
Transferring levy funds helps businesses and addresses skill gaps in specific sectors and locations, creating job and career development opportunities across England.
Learn more: For guidance on transferring apprenticeship funds using your apprenticeship service account, read our GOV.UK guidance page or watch our video.