DfE Releases Apprenticeship Levy Rules

September 5, 2016 9:52 am

The Department for Education has confirmed that the Apprenticeship Levy will be implemented from April 2017.  The newly issued ‘Apprenticeship Funding’ guidance re-stated that:


  • Employers with a pay-bill of more than £3m will pay 0.5% into the Apprenticeship Levy scheme
  • The resulting Digital Apprenticeship Service (DAS) account will be topped up by 10% by Government
  • Employers will be able to use the credits in their DAS account to directly purchase apprenticeship training from an approved provider list
  • Funds can be used to train both new recruits and existing employees
  • Non levied employers will now only pay a 10% contribution to the cost of training their apprentices whilst Government funds the remaining 90%
  • Employers with less than 50 employees will not have to pay for the training of apprentices aged 16-18 at all – these will be fully funded by Government
  • Employees who train an apprentice aged 16-18 will received an additional £1000 from Government paid in two installments
  • An additional £2000 will be available to support apprentices with who have an education, health and care plan (an ECH) – for example young care leavers
  • Employers can train existing employees even if those employees have gained previous qualifications
  • The actual amounts of funding will be organised in to 15 bands with upper and lower limits. Bands will range from £1500 – £27,000.


Each apprenticeship standard or framework will be allocated to a band and this will dictate how much of your levy can be recovered against specific types of apprenticeship and the upper and lower limits of how much can be transferred to the training provider.

As with many key documents concerning the funding of apprenticeships, the devil is in the detail. In theory one key objective of the apprenticeship reforms was to simplify the whole process to make it easier and more efficient for employers to engage. But you need quite a lot of experience and the knowledge to interpret the jargon and work out what your organisation’s apprenticeship strategy should be.

At the London Apprenticeship Company and the College of Apprenticeship Training we are offering a full apprentice levy planning service designed to get you up and running so that you can start to recover your levied funds quickly from April 2017. Contact us for more details.