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Introduction

The apprenticeship levy was introduced in Finance Act 2016 and applies as from 6 April 2017. The rate of levy is 0.5 % of paybill, offset by a £15,000 ‘levy allowance’. This means that, in effect, it applies only to employers who have an annual paybill of £3 million or more a year.

The apprenticeship levy payment regime is administered by HMRC as part of the RTI system, alongside PAYE tax and NIC.

The money raised by the apprenticeships levy goes into a special training fund which is topped up by government with the aim that it can be accessed by all employers to help meet the training and assessment costs of apprenticeships.

Payments of the apprenticeship levy are deductible in computing the employer’s profits for tax purposes.

For further reading, see Simon’s Taxes E4.11130–E4.11302.

Who has to pay the levy?

The apprenticeship levy is payable by employers, in this content this means anyone who is a secondary contributor in respect of employed earner(s) for Class 1 NIC purposes.

Potentially all employers have to pay the