Apprenticeship Units: Funding

What is the Apprenticeship Levy?

A guide for UK employers funding Apprenticeship Units

The Apprenticeship Levy, now evolving into the Growth and Skills Levy, is one of the UK’s most important employer-funded training initiatives. The updated model gives you greater flexibility to fund apprenticeship units, technical training, and workforce development.

This guide answers the most common employer questions about apprenticeship levy funding and explains how you can use funding to pay for apprenticeship training units, upskill teams, and improve workforce capability.

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What is the Growth & Skills Levy?

The Growth and Skills Levy is the updated version of the Apprenticeship Levy being introduced by the UK government.

The new system is designed to give you more flexibility over how levy funds are spent, including the ability to fund shorter apprenticeship units and approved technical training outside of traditional full apprenticeship programmes.

Employers with an annual pay bill over £3 million must contribute 0.5% of their payroll into a digital levy account. These funds can then be used to pay for approved levy funded apprenticeships and assessment.

You must pay the Apprenticeship Levy if:

Your annual payroll exceeds £3 million
You are an employer operating in the UK
You pay employees through PAYE

Levy payments are collected monthly through HMRC alongside National Insurance and tax contributions.

Employers receive a £15,000 annual levy allowance, which offsets part of the contribution.

Example:

If your annual pay bill is £5 million:

0.5% levy charge = £25,000
Minus £15,000 allowance
Total levy payment = £10,000 per year

This includes:

Apprenticeship course fees
Technical and vocational training
Leadership and management apprenticeships
Professional qualifications embedded within apprenticeship standards UK
Functional skills training where required
End-point assessment costs

Employers can use apprenticeship funding for businesses across a wide range of sectors, including:

Business administration
Digital and IT
Engineering
Construction
Health and social care
Finance and accounting
Leadership and management
HR and learning and development

Can employers fund individual Apprenticeship Units?

This is one of the most common questions employers ask about apprenticeship levy training.

In most cases, levy funding supports full apprenticeship programmes rather than standalone commercial training courses.

However, we deliver apprenticeship training in unit-based or modular formats that allow employers to target specific development needs.

This means you can:

Enrol employees onto full apprenticeship pathways
Use modular delivery approaches
Focus learning around relevant workplace competencies
Build skills progressively across teams

The apprenticeship itself must still meet government apprenticeship funding rules and include all required elements of the apprenticeship standard.

How does the Apprenticeship Levy work?

You access your funds through the government’s Digital Apprenticeship Service account.

The process generally works as follows:

Levy contributions are collected monthly through PAYE
Funds appear in your digital account
The government adds a 10% top-up to monthly contributions
You select an approved apprenticeship provider UK such as Leep
Funding is paid directly to us to provide the training on your behalf

Important: Unused Apprenticeship Levy funds expire after 24 months, so proactive workforce planning is essential.

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