UNDERSTANDING APPRENTICESHIP LEVY

The Apprenticeship Levy is a UK government initiative designed to fund apprenticeship training. Employers with an annual payroll above £3 million pay the levy at a rate of 0.5% of their total payroll. These funds are placed into a digital apprenticeship service account, which employers can then use to pay for approved apprenticeship training and assessment. Employers who do not pay the levy can still access government funding for apprenticeships, with the government covering up to 95% of the training costs.

Levy payments are collected through PAYE and transferred into an employer’s Apprenticeship Service account. The funds can then be used to pay for apprenticeship training with approved training providers. Employers also receive a 10% top-up from the government each month on the funds entering their account. If the funds are not used within 24 months, they expire.

Only employers with an annual payroll exceeding £3 million are required to pay the levy. However, employers of any size can benefit from apprenticeship programmes. Non-levy paying employers can access government co-investment, where the government funds the majority of the training costs.

Yes. Even if an organisation does not pay the Apprenticeship Levy, it can still benefit from apprenticeship funding. Small employers can access government co-investment, where the government covers 95% of the training costs, and the employer contributes the remaining 5%. This means organisations of any size can use apprenticeships to develop new talent, upskill existing employees and strengthen their workforce.

Yes. Employers who do not pay the Apprenticeship Levy can still access government funding for apprenticeship programmes through the co-investment model. Under this model, the government covers 95% of the training costs, while the employer contributes the remaining 5%. At Momentous Learning, we support non-levy employers by helping them: • Identify suitable apprenticeship programmes for their organisation • Understand available funding and co-investment options • Set up and manage their Apprenticeship Service account • Provide structured training and support for apprentices throughout the programme This makes it possible for organisations of any size to invest in workforce development while keeping costs manageable.

Yes. Apprenticeships are not limited to new recruits. Many employers use levy funding to upskill existing employees, develop future managers and strengthen leadership capability across their organisation. Programmes such as leadership and management apprenticeships are commonly used to support career progression within organisations.

Yes. Levy-paying employers can transfer up to 50% of their annual apprenticeship levy funds to other organisations. These transfers are often used to support smaller employers, supply chain partners, or local businesses that want to deliver apprenticeship programmes but do not have sufficient funding in their own Apprenticeship Service account. The receiving employer can then use the transferred funds to pay for approved apprenticeship training and end point assessment. Transferred funds must be agreed between the levy-paying employer and the receiving organisation and managed through the Apprenticeship Service. At Momentous Learning, we work with employers and partners to help identify suitable apprenticeship programmes and ensure transferred levy funding is used effectively to support workforce development.

Levy funds expire after 24 months if they are not used. Many employers lose a significant portion of their levy contributions simply because they are unaware of how the funding can be applied. Planning apprenticeship programmes in advance allows employers to maximise the value of the levy before funds expire.

Levy funding can be used for a wide range of apprenticeship programmes across different sectors and job roles. At Momentous Learning, we deliver programmes including: • Leadership and Management Apprenticeships • Coaching Professional Apprenticeship  • International Freight Forwarding Apprenticeship • Youth Support Worker Apprenticeship These programmes allow employers to invest in workforce development while using available government funding.

Employers can work with an approved training provider to design apprenticeship programmes that support both business needs and employee development. Our team at Momentous Learning works with employers to: • Identify suitable apprenticeship pathways • Support apprenticeship service setup • Align programmes with workforce development plans • Deliver high-quality training and support for apprentices If you would like to explore how to make the most of your apprenticeship levy funding, please get in touch with our team to discuss how apprenticeships could support your organisation and workforce development plans.