The Apprenticeships levy hasn't been far away from the headlines over the past few months, but what exactly is the levy and how will it affect individual employers?
Debbie Scotton, Business Development Manager from South Leicestershire College, a provider of Apprenticeships across the Midlands, discusses:
"There's no denying there is a lot of uncertainty about when the Apprenticeships Levy will come into force. Although originally planned for April 2017, factors such as Brexit and the Department for Business Innovation and Skills undergoing a restructure, will potentially result in it being postponed.
"However regardless of its start date, the aim of the levy is to address skills shortages and really put employers in the driving seat in terms of what and how training is delivered."
What is the Apprenticeships levy?
The Apprenticeships levy is a type of payroll tax that will support the government's pledge to create three million Apprenticeships starts by 2020.
Who does it apply to?
It will apply to all UK employers in both private and public sectors but only those who have an annual pay bill of more than £3 million will need to pay. Employers with an annual pay bill of less than £3 million will not pay the levy.
How much will employers pay?
For employers paying into the levy, it will be charged at a rate of 0.5% of their pay bill. All employers will receive a £15,000 fixed annual allowance to offset the levy payment.
For those who don't pay into the levy, they will be asked to make a contribution to the cost of the training and the government will pay the rest up to the maximum amount of funding available for that Apprenticeship.
How do you pay?
For those making payments, they will be collected monthly by HMRC through Pay as You Earn.
What can the levy allowance be spent on?
All Apprenticeship training within the approved standards list. This will not include Apprenticeship salaries.
What is the Digital Apprenticeship Service Account?
All employers will have a Digital Apprenticeship Service Account, regardless of whether they make levy payments. As well as allowing employers to access their funding, the Digital Apprenticeship Service will allow them to identify a training provider, choose an Apprenticeship training course and find a candidate.
Debbie adds: "Here at South Leicestershire College, our aim is to work closely with employers to ensure we are providing the highest quality Apprenticeships, not only to benefit businesses and young people but the economy as a whole."
To find out more, call 0116 264 3545 or email email@example.com
Publication date: Wednesday 10th August 2016