Apprenticeship fundingEmployerThis article sits within the Employer section
You can get apprenticeship funding to help pay for apprenticeship training.
This information is for apprenticeship funding in England. There are different arrangements for apprentices in Scotland, Wales and Northern Ireland.
The apprenticeship levy
From 6 April 2017, employers with an annual pay bill over £3 million must report and pay the apprenticeship levy through the PAYE process.
Co-investment is when employers share the cost of training and assessing apprentices with the government.
If your organisation pays the levy, your account will automatically go into co-investment if you do not have enough apprenticeship funds to pay for training and assessment.
Your organisation may need to pay some of the cost, but the government will pay the rest up to the funding band maximum. If the apprenticeship started:
- after 1 April 2019, your organisation must pay 5%
- before 1 April 2019, your organisation must pay 10%
If your organisation does not pay the levy, then it always co-invests with the government. The maximum amount your organisation will pay for apprenticeship training that started:
- after 1 April 2019 is 5% of the total cost
- before 1 April 2019 is 10% of the total cost
Get an apprenticeship service account
Employers need an apprenticeship service account to:
- receive their apprenticeship service funds
- manage their apprentices
- pay a training provider
- stop or pause payments to a training provider
- receive a transfer from a levy-paying employer
Use your apprenticeship funds
To get funding for an apprenticeship, the apprentice must work in England for at least 50% of their time.
Use your apprenticeship funds (up to the funding band maximum) to pay for an apprentice’s training and assessment.
You cannot use these funds to pay for:
- statutory licences to practise
- travel and subsidiary costs
- work placement programmes
- setting up an apprenticeship programme
If the training and assessment cost more than the funding band maximum, your organisation must pay the difference.
View the apprenticeship funding rules to see everything you can use your apprenticeship funds for.
Employees living in England
For organisations with an annual pay bill over £3 million, the amount of apprenticeship funds in your account depends on your ‘English percentage’. HM Revenue and Customs (HMRC) use the following information to work it out:
- how many of your employees live in England
- how much of your pay bill is paid to them
You can view your English percentage in your apprenticeship service account.
How it works
1. Select an apprenticeship type
‘Standards’ cover a specific occupation and set out the core skills, knowledge and behaviours an apprentice needs. You’ll also need an end point assessment organisation.
2. Choose a training provider
Choose an approved training provider to deliver your apprenticeship training.
3. Agree the cost
You must negotiate and agree the total cost for an apprenticeship with your training provider, which includes training and assessment costs. Take into account any relevant prior learning when you work out the cost.
For apprenticeship standards, you must also agree the end-point assessment cost with an end-point assessment organisation.
4. Use your apprenticeship service funds
If your organisation pays the levy, your apprenticeship funds will enter your account each month after you declare it to HMRC. Funds will leave your account when you pay your training provider.
If your organisation does not pay the levy, you need to reserve funds in your apprenticeship service account. This funding is paid directly from the government to the training provider, so you do not see the funding you have access to.