With radical changes ahead, Apprenticeships are set to play a significant role in developing the future workforce, increasing productivity and driving growth in the economy.
From May 2017 all employers with a payroll over £3 million a year will pay a mandatory tax of 0.5% of their payroll bill into an online account each month. The account will be topped up with additional payments by the government and can be used to buy apprenticeship training for their employees.
Here are the key facts:
- The Levy will apply to all employers in the UK with a payroll bill over £3 million per year.
- The payroll will be combined to include all associated businesses.
- The Levy will be payable through Pay As You Earn (PAYE) alongside income tax and National Insurance.
- Payroll will be calculated on total employee earnings; it will not include other payments such as NI or benefits in kind.
- The Levy payments can be reinvested back into the workforce in the form of Apprenticeship training and assessment.
- Employers will have 24 months to spend the money before it is reallocated to other businesses in the UK.
As an employer, clearly this will have a significant impact on your plans for developing your workforce – so at PWG, we’re offering a Levy Strategy service specifically designed to help organisations fully understand, prepare and best plan for the changes.