Welcome to the New Tax Year... Apprenticeship Levy Update

The new tax year has well and truly arrived, and that means the government’s Apprenticeship Levy is now in effect. Find out how this will affect your business and what steps to take to make sure you’re meeting the government’s new training expectations. 

The facts: From May 2017 every business with a pay-roll of over £3 million a year will be liable to pay the levy. As recruiters, this covers anyone you pay via PAYE, including agency workers, contractors, interim staff, etc.

How much do I need to pay?: You’re required to pay 0.5% of your overall wage bill into the apprenticeship service.

Where does my money go?: You will pay the levy into a digital account, much like banking. This money is to be accessed only to set against apprenticeship programmes.

What can I spend the money on?: You can only use the levy money on apprenticeship schemes for new or existing staff within your own organisation. For more information about recruitment apprenticeships read about the IRP’s own Apprenticeship programmes.

What if my pay-roll is less than £3 million?: For now you are exempt from paying the levy and will receive £15,000 funding to support the cost of apprenticeship training within your organisation. Your exemption may change in time, so make sure you stay up to date with legislation around this topic.

Next steps

• First things first, get more detailed information in the latest edition of the IRP Legal bulletin and share this with colleagues so your whole team is up to speed.
• Register your company with the digital apprenticeship service, set up by the government to support the Apprenticeship Levy.
• Look into the recruitment industry-specific IRP Apprenticeship training programme and discover how you can get the most out of the new scheme.
• Download our Apprenticeships infographic to discover the benefits apprenticeships can have for your business.
• Bookmark the government’s Apprenticeship Levy web pages so you can find and access information easily.
• Download the IRP Professional Guide on the Apprenticeship Levy and use this to help you explain the change to your clients.