If you’re a business operating in the United Kingdom, utilising your apprenticeship levy funds can have a big impact on your organisation, from developing a more motivated and skilled workforce to growing your essential training, to creating better relationships with your training providers. So, what is the apprentice levy? And, how can you maximize your funds to make the biggest impact on training?
What is the apprenticeship levy?
Effective in 2017, the Apprenticeship Levy was introduced to help the government develop a better-skilled workforce and encourage employers to take on apprentices by funding apprenticeships. In simple terms, the apprenticeship levy is a mandatory tax implemented by the UK government for businesses based in England, that requires employers to pay a tax to fund apprenticeships and similar training programmes.
Employers that have a total payroll of over £3 million per annum, will be required to pay a 0.5% levy of their pay bill that’s offset by a £15k allowance. Despite just 2% of employers paying into the levy during the 2017 and 2018 fiscal years, England was able to fund close to 50% of available apprenticeships!
How does the apprenticeship levy work?
Contributions to your levy account appear in an online account created by the HMRC and are collected monthly through PAYE. Business owners that have contributed to the levy for the fiscal year can access their levy funds to finance apprenticeship training programmes for their business. It must be noted that after 24 months, any unused levy funds are relinquished back to the government account (use it or lose it).
If you are a non-levy paying business that doesn’t meet the £3 million minimum, you can still receive funding towards the cost of training apprentices from the Education and Skills Funding Agency (ESFA), who provides 95-100% of funding, depending on how many employees you have.
How to get started using your apprenticeship levy.
To access funds that you’ve paid into the levy, you’ll need to register and establish a Digital Apprenticeship Service (DAS) account managed by the UK government.
While it might seem easier said than done, managing everything that goes into an apprenticeship program for your business takes thorough planning and organisation to ensure its success. Keep in mind, that while apprentices in your training programme are considered employees, they are usually kept on a separate development path from that which your other employees are on. So, between managing training for your regular full-time employees and your apprentices, most employers may find organising operations and logistics complex at first, whether they are new to using levy funds, just starting an apprenticeship programme or even long-time experts. The good news is that it can be a lot simpler than you can imagine.
To make the most out of your apprentice training programme, you’ll want to think about how to best streamline your training back-office, including how to manage training operations such as scheduling, resources, instructors and costs, all in one cohesive system. Turning to learning technology such as a Training Management System like Training Orchestra, can help your training administrators, management, and the human resources team, to efficiently manage both—without the need for spreadsheets or multiple disparate tools!
Using a Training Management System (TMS) to Maximise Your Levy Funds
Introducing an apprenticeship programme can be an exciting new step in your company’s journey however what most levy fund beneficiaries fail to realise is how much administrative work goes into onboarding and maintaining their apprentice programmes. Most human resources or training managers usually find themselves hampered with more time-consuming work using additional spreadsheets to ensure their apprenticeship track is going according to plan. This can include multiple spreadsheets to track and manage everything from the apprentice work schedule and shadowing periods in addition to tracking their costs and resource use. When managing multiple apprenticeship roles in your training programme, incorporating a training management system (TMS) can relieve your HR team of routine admin duties related to training by organising and streamlining just about everything that goes into managing your new roles with your levy funds. How so?
Manage Apprenticeship Costs
Make every pound count in getting your trainees set up for success. An apprenticeship budget can be measured apart from your company training budget with a dedicated training cost tracking tool within your TMS. Know your fund’s balance in real-time as you invest in training time and resources, and get alerts when you’re about to hit a limit.
Apprentice Programme Course Scheduling
An added benefit to a TMS for apprenticeship training rollout is the ability to more easily schedule your training and resources such as instructors, rooms and equipment. As well, after you’ve set aside training blocks for in-person or virtual on-hands training for your apprentices, a course scheduling system allows you to easily track your all of scheduling data in detail including the number of apprenticeship training hours per day, training costs, and resource usage, saving you time and budget.
Track Apprentice Progress
Apprenticeship lengths vary considerably. From 12 to 24 months for apprenticeships in management and customer service to accounting apprenticeships that can last as long as 4 years. An integrated training reporting tool gives your training team insight into how apprenticeship training is progressing throughout the duration of their programme. Set training milestones as well as the ability to input performance notes per task.
Ready to Start Your Apprenticeship on the Right Foot? Avoid having a sticky wicket and kick-start your
apprenticeship programme using levy funds. Start with a free demo today!
Industry awards & recognition for our Training Management Software
Training Industry names Training Orchestra to its Top 20 Training Delivery Companies list for three consecutive years – 2019, 2018 & 2017.
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