In recent years there’s been a rapid uptake in the number of apprenticeships. And with this, the benefits of apprenticeships for employers are becoming more widely known.
There’s often a misconception that apprenticeships are expensive to fund, but this certainly isn’t the case!
Most businesses are eligible for funding support from the government – or even other businesses. Whilst there are a growing number of initiatives, both locally and nationally, providing cash injections to employers who offer apprenticeships. Learn more about these schemes on our Apprenticeship Incentives page.
Here, we’ll run through the three key ways of funding an apprenticeship in detail and highlight some of the additional incentives that are available. You can learn even more about the various funding opportunities available in our free to download e-guide ‘Funding to Fire Up your Business’.
The Apprenticeship Levy is a tax on UK employers to fund new apprenticeships helping to boost investment in vocational skills.
The levy is paid by all employers with an annual wage bill in excess of £3m. Companies will pay 0.5% of their gross payroll over £3m into their Apprenticeship Levy pot. It’s paid via PAYE to HMRC alongside income tax and National Insurance.
Employers in England who pay the levy and participate in apprenticeship programmes receive more than they pay into it. They earn an additional 10% through a monthly top-up to their digital account.
Levy payments can be used to fund apprenticeships right across your organisation, not just for new employees. So staff seeking promotion could be eligible for a supervisory or management apprenticeship and more senior workers could take on a degree-level apprenticeship – funded by the levy.
Funds in your levy pot are only available for 24 months, after which time the Government keeps the money. Take advantage of your levy pot by upskilling your team today!
Smaller companies, who don’t pay the Apprenticeship Levy, have access to the government’s co-investment fund to support with the cost of apprenticeship training.
Employers only make a 5% contribution towards the cost of an apprenticeship, and the Government will pay the remaining 95% – up to the maximum amount of funding set for the apprenticeship chosen.
These payments are made directly to the apprenticeship training provider and the End Point Assessment operative. Additionally, employers who don’t pay the levy are eligible for additional funding and support. This is dependent on the apprentice’s circumstances or if a business employs fewer than fifty people.
We have a team of experts who understand the various initiatives available both locally and nationally to help you take advantage of the scheme/s best suited to your company’s needs. Get in touch today to find out more.
A handful of employers who pay the Apprenticeship Levy can sometimes find themselves in a situation where they have unspent funds.
This opens up the opportunity for these businesses to support others by transferring up to 25% of their annual funds to another business in need. These companies can make transfers from their apprenticeship account to as many employers as they choose.
Any employer can receive a levy transfer, whether you pay it yourself or not. Transfers can only be used towards new apprenticeships, not ones already underway.
Connect2Care, and our sister company – HIT Training, work with a large number of businesses who are willing to transfer funds from their Apprenticeship Levy to employers in the adult care, health care, and early years sectors.
This means that we can support you to access apprenticeships with the costs covered by a levy transfer. Get in touch today to see how we can help you!
The Workforce Development Fund enables businesses to claim back the cost of an employee undertaking any health and social care qualifications, programmes, or digital learning.
Funded by the Department of Health and Social Care and facilitated by Skills for Care, employers are able to recoup the cost of employee salaries whilst training, the cost of an apprenticeship, fees incurred by coaching and mentoring, venue hire, and wage replacement costs.
Connect2Care are a Skills for Care Centre of Excellence and have a lot of experience of the Workforce Development Fund. Get in touch today to learn how we can support you to access these funds.
Apprenticeship levy transfers
National Insurance breaks
Advanced Learner Loans