All employers with an annual wage bill of over £3million pay the apprenticeship levy. The levy is used by the government to fund the development and delivery of apprenticeships.

Employers fall into one of two categories; levy-payer and non-levy payer.

Non-Levy Payer

Non-levy paying employers will share the cost of training and assessing their apprentices with the government - this is called ‘co-investment’. The contribution required by employers is 5%, and the government will pay the remaining 95%, up to the funding band maximum.

If you employ a 16-21 year old (or 22-24 year old with a EHC plan) and have less than 50 employees your contribution will be £0 – so the training will be free.

The Apprenticeship Service have created a simple 7 step checklist for any non-levy employers who are looking to hire an apprenticeship, which includes information on setting up an account, advertising your vacancy, accessing incentive payments and the end-point-assessment process.

Levy-Payer

If you have a wage bill over £3million you will be classed as a levy-payer and will contribute 0.5% of your wage bill, less an allowance of £15,000.

The wage bill includes all earnings that are subject to class 1 National Insurance contributions, such as wages, bonuses, commission and pension contributions. There is a levy allowance of £15,000 per year. This means the total you will pay is 0.5% of your wage bill less £15,000.

If you do not have enough funds in your levy pot to contribute towards the cost of training, the balance will be co-funded by the government, and you will contribute 5% of the balance.

The 2025 to 2026 apprenticeship rules will be released in May 2025 on the Government website.

Approved Training Provider

Leeds College of Building are classified as an approved training provider for the delivery of apprenticeships. Apprenticeship frameworks and standards are allocated a funding band, all of the College’s apprenticeships are currently within the upper funding band limit.

The government apprenticeship website provides a step by step guide on choosing a framework or standard and selecting a training provider and assessor.

Apprenticeship Service

The Apprenticeship Service is now available to both levy and non-levy payers. Non-levy payers can find further information here.

The service allows you to:

  • select an apprenticeship standard
  • choose the training provider or providers you want to deliver the training
  • choose the organisation that will assess your apprentices
  • post apprenticeship vacancies
  • set the price you’ve agreed with your training provider
  • pay for apprenticeship training and assessment
  • check the balance in your account

Useful link: Apprenticeship Service