Who pays for an apprenticeship?

Apprenticeship funding in England splits at a wage bill of £3 million. Above it you pay the Apprenticeship Levy; below it you use government co-investment. Either way the money pays for training and assessment by an approved provider — never the apprentice's wages, which are your cost.

Levy payers

Employers above the threshold pay 0.5% of the wage bill, less a £15,000 allowance, into a digital apprenticeship service account. Funds expire 24 months after they enter the account, which is why large balances go unused. Two things prevent that: using the levy to upskill existing employees through a relevant standard — including degree apprenticeships at Levels 6 and 7 — and transferring up to 50% of unused funds to other employers, typically in your supply chain. Connected companies share one £15,000 allowance between them.

Everyone else

• Co-investment — government funds 95% of training and assessment costs and you pay 5%.
• Fully funded — employers with fewer than 50 staff pay nothing for an apprentice aged 16–18, a care leaver under 25, or an apprentice under 25 with an education, health and care plan.
• Incentive payment — £1,000 for taking on an apprentice aged 16–18 or meeting those care criteria, paid through your apprenticeship service account.

Every employer, levy-paying or not, registers on the apprenticeship service to manage this.

Training is built around approved standards developed by employer groups — over 600 of them, from software developer to butcher — each sitting in a funding band that caps the government contribution, ranging from £1,500 to £27,000. Choose a provider from the Register of Apprenticeship Training Providers; they handle most of the compliance. Apprentices must spend at least six hours a week, or 20% of contracted hours, on off-the-job training during working hours.

Apprenticeships are not limited to new recruits: existing staff can be enrolled where the training is substantively new for them, which is how many employers fund management and technical development. Reform is under way through the planned Growth and Skills Levy, intended to allow shorter modular training alongside full standards — confirm the current rules with government guidance before committing a training budget. Some sectors add their own incentives, and your Growth Hub will know about local ones.