Whether you’re dipping your toes into the world of Apprenticeships for the first time, or you’re a seasoned pro, the funding rules can be a major headache!

Luckily, we’ve been doing Apprenticeships for over 20 years, so we know a thing or two about it. 

Let’s start with looking at how apprenticeship funding works for an Apprenticeship Levy paying employer. Currently this is only 2% of UK employers! Each employer will have a digital account, where they can access their funds to spend on levy training. The apprenticeship levy funds will remain in your account for two years,  after this time it expires and you will not be able to access this money, so it’s important to use it.

How can you spend your Apprenticeship Levy?

You can only use your Levy fund to invest in high quality apprenticeships. The good news is that there’s plenty of choice, at Firebrand we offer over 15 IT and Digital based apprenticeships.  You can use your Apprenticeship levy to fund any level of apprenticeships, from level 2 which is around GCSE level, to degree level!

So, what can’t you use the Levy for?

  • Apprentices’ wages – these must be paid by you.
  • Top up qualifications, or any qualifications that are not already approved as part of the apprenticeship.

Levy Transfer

Levy-paying businesses have the option to allocate up to 25% of their levy funds annually to support apprenticeship training and assessments in other businesses. The choice of which businesses and apprenticeships to support is entirely yours; any business can receive a transfer of levy funds, even if they pay the levy!

The apprenticeship service calculates this 25% based on the levy amount declared in the previous tax year, incorporating the English percentage (reflecting the proportion of your employees in England) and a 10% top-up payment from the government. It's important to note that the transfer cannot exceed 25%.

If you decide to transfer funds, you can still receive funds from another levy-paying employer. 

From April 2024: This amount will be set at 50% of levy funds!

SME or Non Levy Paying Employer?

If you’re a smaller employer, and you’re employing less than 50 people the government will fund your entire training fee when you take on apprentices aged under 19.

Taking on older apprentices? Not a problem, as long as your annual pay bill is less than £3 million, you’ll only pay 5% of the cost of their apprenticeship training, the Government will fund the rest.

Note: From April 2024, the government is set to scrap small and medium-sized employer (SME) co-investment payments for apprentices under the age of 22.

Additional funding and benefits

As a smaller employer or SME when you take on an apprentice, aged 25 and under you don’t have to pay employer national insurance contributions until the apprentice earns over £4189 per month.

You will also receive a £1000 bonus when you take on any apprentice aged under 19. Or, aged 19-24 who have an education, health and care plan, or have been in care.


Let's talk

Our levy and funding experts are here to talk you through hiring your first apprentice, or even hiring your 100th apprentice!