Employers of any size can use the Growth and Skills Levy to fund apprenticeship training. If your pay bill is over £3 million, you pay into the levy and draw down funds through a digital account. If it isn’t, you share the cost with government, though training for 16-24 year olds is now fully funded regardless. On top of training funding, employers can claim stackable incentives worth up to £6,000 per apprentice, including hiring grants, a youth jobs grant, and a National Insurance exemption.
Free employer webinar
Grow Your Team, Backed by Funding: Free Employer Webinar
Join us live to see how apprenticeship funding actually works, and what it takes to hire your first apprentice with confidence.
29 September · Free to attend
What Is the Growth and Skills Levy?
Managed by government body Skills England, the Growth and Skills Levy funds apprenticeship training to help employers develop the skills they need. Formerly known as the Apprenticeship Levy, it’s a UK tax on employers with an annual pay bill over £3 million, charged at 0.5%. From 2026, it gives employers more flexibility in how funding is used, including access to new types of training.
- Applies to apprentices spending at least 50% of their working time in England. Scotland, Wales and Northern Ireland run separate systems.
What Training Can Be Funded?
- Full apprenticeships: Level 2 to Level 6 for all eligible apprentices, and Level 7 where the apprentice is aged 16-21 (or under 25 with a care leaver/EHCP status).
- Apprenticeship units: short, flexible training lasting roughly 1-16 weeks, for existing employees aged 19 and over.
- Foundation apprenticeships: entry-level apprenticeships for those aged 16-21 (or under 25 where eligible) at the start of their career.
How Much Funding Do You Receive?
- Levy-paying employers: training costs are drawn from your digital levy account at no further charge, for as long as funds are available.
- Non-levy employers: you share the training cost with government. Training for apprentices aged 16-24 is fully funded; for apprentices 25 and over, you typically contribute a share of the agreed price.
- Unused levy funds can be transferred to other businesses, including within a supply chain.
Stackable Financial Incentives
- £1,000 for hiring an apprentice aged 16-18 (or under 25 where eligible).
- £3,000 youth jobs grant for hiring an apprentice or non-apprenticeship employee aged 18-24 who has been unemployed and on Universal Credit for at least six months.
- Zero employer National Insurance for apprentices under 25, ending on their 25th birthday regardless of time left on the apprenticeship.
- From 1 October 2026, non-levy employers can also receive an additional £2,000 cash payment for apprentices aged 16-24 hired or started on or after that date.
Worked example: a non-levy employer hiring an 18-year-old apprentice from 1 October 2026 could receive £1,000 (age 16-18) + £2,000 (non-levy SME hire, 16-24) + £3,000 (youth jobs grant, if eligible) = up to £6,000 in total incentives for a single apprentice.
Frequently Asked Questions
Can I get funding for apprenticeships?
Yes. Through the Growth and Skills Levy, government funding is available for apprenticeship training regardless of business size. How much you receive depends on whether you pay into the levy, how you want to use the training, and the age of the apprentice.
What is the Growth and Skills Levy?
The Growth and Skills Levy, formerly known as the Apprenticeship Levy, is a UK tax on employers with an annual pay bill over £3 million, charged at 0.5%. It funds apprenticeship training and, from 2026, gives employers greater flexibility in how that funding is used.
How much does an employer contribute to apprenticeship funding?
Levy-paying employers draw down training costs from their digital account at no further charge. Non-levy employers typically contribute a share of the training cost, though training for apprentices aged 16-24 is now fully funded regardless of levy status.
Are there additional financial incentives available?
Yes. Employers can receive £1,000 for hiring an apprentice aged 16-18, a further £2,000 for hiring a 16-24 year old from 1 October 2026, a £3,000 youth jobs grant for eligible 18-24 year olds who have been on Universal Credit for six months or more, and a National Insurance exemption for apprentices under 25. These incentives can be stacked, worth up to £6,000 in total.
Can funding be used to pay an apprentice’s salary?
No. Apprenticeship funding covers training costs only. Apprentice wages remain the employer’s responsibility, though incentive payments can offset overall cost.
