The apprenticeship levy is a service introduced by the UK government in April 2017. The purpose of the levy is to provide employers with funds to support apprenticeship training. If your business has an annual payroll of more than £3 million, you will be required to pay the levy. This blog post will explain what the apprenticeship levy is and how your business can benefit from it!
What is the Apprenticeship Levy?
The apprenticeship levy is a tax that employers pay with an annual payroll of more than three million pounds. The money raised from the levy is used to fund apprenticeship training and support businesses in England that offer apprenticeships. This ensures that businesses have the resources they need to provide high-quality apprenticeship training.
How Can My Business Use the Apprenticeship Levy?
If your business pays the apprenticeship levy, you will be able to access funds to support apprenticeship training. You can use these funds to pay for the cost of training and assessment for your apprentices. You can also use the funds to support other costs associated with apprenticeships, such as travel and subsistence. This gives you the opportunity to provide a highly competitive apprenticeship program and attract the best talent.
What Are the Benefits of the Apprenticeship Levy for Employers?
There are many benefits of the apprenticeship levy for employers. By investing in apprenticeships, you can:
- Develop a skilled workforce that meets the needs of your business.
- Use apprenticeships to build your talent pipeline and succession plan for the future.
- Cut recruitment costs by offering talented apprentices permanent contracts.
- Improve productivity and competitiveness, reducing staff turnover.
FE News stated, “In 2019, employers spent Just £864m of their combined £3bn levy pot – an almost £2bn differential in one year alone.” These figures show that utilising the levy is the right thing to do for your business from a financial perspective. If you are an employer in the UK, it’s worth taking advantage of this fantastic opportunity.
Utilising the levy could also give you an edge over your competitors as you attract the best talent who potentially may stay with your company for a long time.
How Do I Pay the Apprenticeship Levy?
If your business must pay the apprenticeship levy, you will need to register with HMRC. Once you have registered, you will be able to pay the levy through your payroll.
You can also transfer up to 25% of your apprenticeship levy to another business. This means that they will receive the money directly and can significantly boost your reputation in the form of this charitable donation.
You Can Also Transfer Your Levy To:
- Your supply chain
- Local businesses
- Charities and not-for-profits
- Regional partners
- Your customers
This means that the levy can be directly utilised by the recipient and not go to waste! If you’re not sure who to transfer your levy to, Employer an Apprentice provides a free matching service.
If you have any further questions about the apprenticeship levy or how it can benefit your business, take a look at our dedicated pages or contact us directly at email@example.com.