Apprenticeship funding (training provider)
Employers can get apprenticeship funding to help pay for apprenticeship training and assessment.
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.
If levy-paying employers do not have enough funds to make a monthly training payment, they can share the remaining cost with the government. This is called ‘co-investment’.
Employers will need to pay 5% (10% for apprenticeships that started before 1 April 2019) of the balance for that month and the government will pay 95% (90% for apprenticeships that started before 1 April 2019) up to the funding band maximum.
Get an apprenticeship service account
Levy-paying employers need an apprenticeship service account to:
- receive their levy funds
- manage their apprentices
- pay a training provider
- stop or pause payments to a training provider
If employers do not pay the levy, they can only create an account to receive a transfer from a levy-paying employer.
Use apprenticeship funds
To get funding for an apprenticeship, the apprentice must work in England for at least 50% of their time.
Use apprenticeship funds (up to the funding band maximum) to pay for an apprentice’s training and assessment.
Employers 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, the employer must pay the difference.
View the apprenticeship funding rules to see everything employers can use apprenticeship funds for.
Employees living in England
The amount of apprenticeship funds that enter the apprenticeship service account depends on the employer's ‘English percentage’. HM Revenue and Customs (HMRC) use the following information to work it out:
- how many employees live in England
- how much of the pay bill is paid to them
Employers can view their English percentage in the 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. They also need an end point assessment organisation.
‘Frameworks’ include work-related vocational and professional qualifications, with workplace and classroom training.
We’re withdrawing frameworks. Apprentices cannot start a framework after 31 July 2020.
2. Choose a training provider
Choose an approved training provider to deliver apprenticeship training.
3. Agree the cost
Employers must negotiate and agree the total cost for an apprenticeship with their training provider, which includes training and assessment costs. Take into account any relevant prior learning when working out the cost.
For apprenticeship standards, they must also agree the end-point assessment cost with an end-point assessment organisation.
4. Use apprenticeship service funds
Apprenticeship funds will enter the employer’s account each month after they declare the levy to HMRC. Funds will leave the account when they pay their training provider.