The Apprenticeship Agenda

Apprenticeship levy payroll services


The Government has made a commitment to achieve three million apprenticeships by summer 2020. In order that this can be achieved there will be an introduction of an Apprenticeship Levy in April 2017 which will be mandatory for employers with a pay bill over £3 million. The government believes this will put funding for apprenticeships on a sustainable footing whilst increasing the quality of training.

The levy will then be ring fenced in the form of a Digital Voucher which the employer can use to pay for apprenticeship training.

The levy will be calculated at 0.5% of their monthly pay bill and will be collected via PAYE in the same way as tax and national insurance. The returns will be made as part of HMRC’s Real Time Information system.

The levy is included in the Finance Bill and will remain until it is removed.  The Finance Bill will contain more detailed clauses for the payment of the levy.  These will cover the frequency, tax period, times of payments and amounts payable. For example, if the levy is taken monthly then the apprenticeship levy would only be applicable if the paybill was over £250k for that month.

Who’s included in the paybill?

There are many questions querying who will be included in the paybill, such as contract and temporary staff who work through agencies. Any person who is on your payroll and paid through PAYE would be included in your paybill.

For small and medium employers who are exempt from paying the levy can still benefit from Government funding which may be enhanced due to the levy.  More information about the levy implementation will be available in the coming months.

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