The document discusses the upcoming UK apprenticeship levy that will require employers with a yearly paybill of over £3 million to pay 0.5% of their total paybill into an apprenticeship fund. It explains that the fund can be used to purchase apprenticeship training programs. It provides an example of how much a large company with £200 million in payroll and 10,000 employees would pay into the fund and how many apprentices that money could support based on average training costs. It recommends that employers begin strategic planning to take advantage of the fund and consider converting existing training programs into eligible apprenticeships.

1. Are you ready for the
Apprenticeship Levy?
Jo Preston-Taylor – Managing Director
at BPP Leeds

2. BPP Alumni
Agenda
• What is the apprenticeship levy?
• How does the levy impact your business?
• How will the levy work?
• Strategic planning
• Next Steps
• Questions

3. BPP Alumni
What is the apprenticeship levy?
• From 5th April 2017, Employers with a
paybill of £3m or over will be charged
a levy of 0.5% of their paybill
• The paybill will be based upon your
company’s total UK employee
earnings that are subject to Class 1
secondary NI contributions
• The levy will be payable through the
PAYE system and will be payable
monthly in real time
• The levy is ring-fenced in the form of
an electronic voucher that can be
used to purchase apprenticeship
training

4. BPP Alumni
How does the levy impact your business?

5. BPP Alumni
How will the levy work?

6. BPP Alumni
Strategic Planning
• Companies need to begin planning now to ensure the levy ties in
with their future people strategy
• Do not under-estimate the volume of apprenticeship training
required if you intend to fully utilise your levy pot
• Think about EXISTING staff members as well as NEW HIRE roles
• Think about what your company currently spends on external
training – can any of these programmes be converted into an
eligible apprenticeship training programme?
• More guidance from Government expected in June 16 and
October 16

7. BPP Alumni
Example
• Company A employs 10,000 UK staff
• 75% of staff are based in England
• Payroll bill subject to the levy is
approximately £200m
£200m x 0.5% £1,000,000
English proportion (£1m x 75%) £750,000
Less: £15,000 government allowance (£15,000)
Total levy entering company’s digital account £735,000
Add: 10% government top up £73,500
Total annual levy pot £808,500

8. BPP Alumni
Example
If the company wanted to utilise all of their annual levy pot, the below table
provides an example of how many apprenticeship programmes would
need to be started:
Total annual levy pot £808,500
Average annual cost of a BPP Professional Apprenticeship
programme £4,800
Number of apprentices required 168

9. BPP Alumni
Next Steps….
Also consider:
• Updating your payroll
software
• Consider a pilot
apprenticeship scheme in
September 16 if you do not
currently take on apprentices
• Speak to your apprenticeship
training provider to see how
they can help you plan for the
levy

10. BPP Alumni
Trailblazer Standards
A link to all of the trailblazer standards that have
currently been approved can be found below:
https://www.gov.uk/government/uploads/system/
uploads/attachment_data/file/524852/Apps_stan
dards_list_20.05.pdf

11. joannapreston-taylor@bpp.com
Questions?