The Growth and Skills Levy
Apprenticeship funding
Whether you want to upskill existing employees or bring in new talent, the Growth and Skills Levy is the smartest way to build your long-term pipeline of digital talent.
What is the Growth and Skills Levy?
The Growth and Skills Levy is an update to the Apprenticeship Levy.
The new version keeps apprenticeships at its core, but gives employers greater flexibility in how they invest in skills, allowing organisations to fund non-apprenticeship courses with shorter, targeted programmes to support productivity and changing skills needs.
Who can use the Levy?
If your organisation has an annual wage bill of more than £3 million, you will have a levy fund that you can use. This levy funding is for the purpose of approved Growth and Skills training. If you aren't using your levy fund, you're missing out on the benefits of funded training and talent.
Smaller organisations also benefit, with the government contributing 95% of training costs. SMEs can also acces levy transfer funds, where a larger, levy-paying organisation pledges a portion of their unused funding to help businesses nurture new talent.
What’s changing with the Growth and Skills Levy?
What's changing?
The Growth and Skills Levy is designed to help employers get more value from their levy investment. Key changes include:
- Greater flexibility – levy funds can be used for apprenticeships and other approved skills training.
- Shorter, focused training options – including modular “apprenticeship units” that build specific capabilities.
- Stronger support for SMEs – with 100% funding for younger apprentices.
- Improved collaboration – enabling levy-paying employers, authorities, and SMEs to better meet skills demands.
When are the changes taking place?
From April 2026:
- Employers can use levy funds for approved modular training and apprenticeship units.
From the 2026/27 academic year:
- Levy funds will expire after 12 months (reduced from 24 months), encouraging more proactive use.
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Apprenticeship Levy Explained
Is the Apprenticeship Levy being removed?
No, the Apprenticeship Levy is evolving into the Growth and Skills Levy. Apprenticeships remain a key part of the system, but employers will have more flexibility in how levy funds are used.
When do the changes take effect?
Initial changes are expected from April 2026, with further updates rolled out during the 2026/27 academic year.
Can I still fund full apprenticeships?
Yes, full apprenticeships will continue to be funded through the levy, alongside new modular and shorter training options.
What are ‘apprenticeship units’?
Apprenticeship units are shorter, focused training modules designed to build specific skills in critical areas such as data and AI.
Will levy-paying employers still have digital accounts?
Yes, employers will continue to manage their levy funds through the digital system, although how funds can be spent will expand.
How long will levy funds last?
From the start of the 2026/27 academic year, levy funds are expected to expire after 12 months, rather than the current 24 months.
How can QA help?
QA helps employers plan, optimise and deliver levy-funded training, from apprenticeships to targeted upskilling, ensuring your investment supports both immediate priorities and long-term growth.
What can the Apprenticeship Levy be used for?
Apprenticeship Levy funding can only be used to recruit and train apprentices. A business that does not use or transfer their funding to another business, will lose access to that funding once it expires.
It is designed to benefit both small and large businesses, by nurturing new talent, which in-turn boosts the UK tech industry.
Who pays for the Apprenticeship Levy?
Only businesses with pay a bill over £3m contribute to the Apprenticeship Levy, but the scheme can benefit businesses large and small.
Levy paying businesses can manage and find out more information about their levy funds online.
How can I access funding?
Levy paying employers access their funds through the online Apprenticeship Service. The funds in their accounts are available to spend on apprenticeship training in England. The amount of funding that an employer paying the Apprenticeship Levy can access is linked to the value of their levy contributions, and the proportion of employees living in England.
How is the Apprenticeship Levy paid?
Funds will be taken in month – and available to spend in the following. All payments will be ‘one month in arrears’.
What if I’ve used all the funds in our Apprenticeship Levy?
If you have used all funds available in your Apprenticeship Levy, the 5%* contribution will apply for any existing and new apprentices, until sufficient funds are available within the levy account.
*From the start of 2026/27 academic year, the employer contribution is rising to 25%
How can I set up an account on the Apprenticeship Service?
Levy paying employers will need:
An email address you have access to
The Government Gateway login for your organisation (or you can use the accounts office reference number and employer PAYE scheme reference number if your annual pay bill is less than £3 million)
Authority to add PAYE schemes to the account
Authority to accept the employer agreement on behalf of your organisation
A small employer who does not pay the Apprenticeship Levy can use the PAYE scheme reference number (also known as ERN number) and your account office reference number (AORN).
Become an apprentice
If you're an individual interested in starting an apprenticeship, you can get in touch with us via our Apprenticeship platform.