Budget 2016: Apprenticeship Levy to start in April 2017

On apprenticeships, the Budget confirmed didn’t really add any great detail to what has already been announced on the Apprenticeship Levy and did not clarify how the levy will work alongside the CITB levy.

The Budget Red Book did confirm, as announced in the Autumn Statement and Spending Review 2015, that the government will introduce the Apprenticeship Levy in April 2017 to fund new apprenticeships. In England, control of apprenticeship funding will be put in the hands of employers through the Digital Apprenticeship Service.

The levy will help to deliver new apprenticeships and is designed to support quality training by putting employers at the centre of the system. Employers will be able to get back more than they put in by training sufficient numbers of apprentices.

The levy will be set at a rate of 0.5% of an employer’s paybill and will be paid through PAYE. Each employer will receive an allowance of £15,000 to offset against their levy payment. 

This means the levy will only be paid on any paybill in excess of £3 million. The government will apply a 10% top-up to monthly funds entering apprenticeship levy payers’ digital accounts in England from April 2017.