Apprenticeship Levy

Apprenticeship Levy

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The Apprenticeship Levy has been introduced as part of the government’s plan to deliver 3 million new Apprenticeships by 2020 and create the workforce of tomorrow. As a major commitment to increasing both the quality and the quantity of Apprenticeships in England, the government is putting the control in the hands of Employers around the country. 

As one of the UK’s leading and largest providers of apprenticeship and vocational training, Raytheon Professional Services (RPS) is well placed to support you to maximise your return on investment from the levy. 

Many businesses are still unaware of the levy or have little understanding of how it will work or use their levy. Don’t worry, we are here to help you.

Are you…

1. An employer with a payroll of +£3m per year:

2. An employer with a payroll of under £3m with 51+ employees:

3. An employer with a payroll of under £3m with less than 50 employees:


Enquiring about Government top-up & incentives

Apprentices aged between 16 and 18 (at enrolment) will attract an incentive payment of £1,000 to the employer. This will also be payable for apprentices 19 to 23 years old who have been in care or who have an Education and Health Care (EHC) plan.

The government has confirmed that it will apply a 10% top-up to the monthly funds entering levy paying employers' digital accounts. So for every £1 entered through the levy the government will add £0.10. E.g. £10,000 levy fund will become £11,000.

If you employ an apprentice below the age of 25, you are no longer be required to pay employer National Insurance contributions for them.

Example: If you were paying a wage to a none apprentice of £20k per year the employer would be eligible to pay £1,597.44 in National Insurance. 

However if this person was on an approved apprenticeship scheme the employer National Insurance bill would be £0

Key Facts – what you need to know:

  • Employers cannot use their levy towards training that is not approved as an Apprenticeship Standard or Framework.
  • Employers cannot use the Levy funding to pay for wages, travel and lodgings.
  • Only providers registered on the Register of Approved Training Providers (RoATP) will be able to deliver training (for both levy and non-levy payers).
  • Your apprenticeship provider may charge additional to the funds generated by the system. This will be to cover training that is considered outside of the apprenticeship and often above the normal requirements.
  • If your apprentice needs Maths or English training your training provider will draw funding for this directly from the government and will not be using your Levy pot.
  • The Levy will apply to all large organisations with an annual payroll of over £3million per annum, regardless of whether they already employ Apprentices or not.
  • It will be payable by employers in the UK at the rate of 0.5% of the payroll cost through PAYE alongside Income Tax and National Insurance.

Looking for advice?

Looking for more advice on the Apprenticeship Levy?

Contact our Team >

RPS is strongly committed to encouraging apprenticeships and operates several successful schemes. We specialise is designing bespoke programmes that can meet your needs.

If you are looking to develop your apprenticeship and levy strategy, RPS can arrange a consultancy session with one of our apprenticeship levy experts. They will go through the background to the levy, provide estimates on your liability and advise of potential apprenticeship pathways from across our portfolio of qualifications.

Our experienced and knowledgeable team is on hand to answer all of your questions.


Further information

More information on the Apprenticeship Levy can be found on the Government website using the links below:

How it will work

Funding rules

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