What is The Apprenticeship Levy?

4th Oct 2023
a glass jar with coins falling out of it

In the realm of continuous professional development, apprenticeships have emerged as a powerful tool to foster talent and skill growth. As the dental industry evolves so does the demand for quality apprenticeship programs. Enter the government’s apprenticeship levy: an initiative designed to bolster these apprenticeships.

What is the Apprenticeship Levy? 

The apprenticeship levy is a taxation mechanism introduced to fund and promote apprenticeships across sectors. The levy aims to nurture businesses by enhancing essential training and crafting apprenticeship programmes.

How Does it Work?

  • Employer Eligibility: The levy directly affects businesses with a payroll surpassing £3 million so if your organisation fits this bracket, you're automatically contributing to the levy.
  • Levy Rate: The levy charges 0.5% of an employer's total payroll. This is collected monthly via PAYE, alongside other standard deductions like income tax and national insurance contributions.
  • Usage: The collected amount goes into a digital account, available for employers to fund apprenticeship training or the crucial end-point assessment.

Essential Points to Remember:

  • Time-sensitive Funds: Employers should note that any unused levy funds have a shelf life of 24 months. Post this period, unused funds revert to the government.
  • Support for Non-Levy Payers: If your organisation's payroll doesn't hit the £3 million mark, there's still an avenue for you. Non-levy paying employers can shoulder just 5% of an apprenticeship course's cost and the government steps in to fund the remaining 95% via a 'co-investment' strategy.
  • A Continuous Commitment: Remember, if your payroll exceeds £3 million, the levy isn't a one-time affair. Contributions are ongoing therefore ensuring a steady flow to support apprenticeship programs.