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The apprenticeship levy was introduced by the government in 2017 to create long-term sustainable funding for apprenticeship training. The levy is paid by large employers with a payroll cost of over £3 million, currently 0.5% of the employer's annual pay bill over £3 million.

The apprenticeship levy helps employers (large and small) to invest in high-quality apprenticeship training and development of their workforce in England. Large employers can use the funds they have paid into the levy, whilst smaller employers must contribute 5% of the cost to cover training and assessment from approved providers.

Employers have 24 months to use their funds in their apprenticeship service account, after this point, the funds expire. However, employers can forecast funds that aren’t going to be utilised and transfer these to help fund the 5% due from for smaller employers.

A levy transfer allows organisations with excess funds to transfer funds to other employers, including smaller businesses within their supply chain. The transferred funds can be used to cover the apprenticeship training and assessment costs for the receiving employer's apprentices to support skills gaps and shortages in specific locations or sectors.

Any employer can receive funding to train both new and existing employees eligible for an apprenticeship.  The recipient employer will need to create and set-up an account on the apprenticeship service to link funding with the sending employer.

To transfer levy funds, the sending employer paying the apprenticeship levy must be able to forecast if they will have unused funds in their apprenticeship service account.

They can select the amount they wish to transfer and the recipient employer(s) to which they want to transfer funds by connecting through ‘the apprenticeship service’ (TAS) portal. The receiving employer can then use the transferred funds to pay for the training of their staff.

In order to initiate the transfer, you will need to create an apprenticeship service account. To find out how visit the government web page Create an apprenticeship service account. 

To create an account, you will need:

• an email address
• permission to add your PAYE scheme to the account
• permission to accept the employer agreement on behalf of your organisation.

You will also need either the government gateway login for your organisation, or your accounts office reference number (AORN) and employer PAYE scheme reference number.

By working with QA you have already established your preferred ‘training provider’. QA will support you in identifying the apprenticeship standard to help meet your skills gaps and assist in finding the right people to suit your organisation (if they don’t already exist within your business).

1. Receiving employer agrees terms (standard, cost and duration) with the transferring employer.
2. Receiving employer sets up an apprenticeship service account.
3. Transferring employer connects its apprenticeship service account to the receiving employer.
4. Receiving employer selects QA as the training provider to deliver apprenticeship.
5. Transferring employer gives final approval online.
6. The apprenticeship starts and monthly payments are drawn down from the transferring employer.

The full cost of the apprenticeship training should be covered by the funds transferred to your Apprenticeship Service account. There are practical considerations your organisation should be aware of, but research shows the positive economic contribution of an apprentice far outweigh the costs. Things you should know:

Time:

• There is a small amount of administration time required to manage the apprenticeship service account and every apprentice should have a workplace mentor, to guide and support them through their apprenticeship.

Money:

• The responsibility and liability of the transfer funded apprenticeship lies solely with you (the employer). If at any point the ‘sending’ employer has insufficient funds to cover the cost of the apprenticeship training, your business will enter what’s known as, ‘employer co-investment’. Under ESFA funding rules this means QA will have to charge your business 5% of any funding shortfall.
• Your business is responsible for employing the apprentice, paying their salary and allowing time for their off-the-job training.
  

We value your privacy and treat your information with utmost confidentiality. Here's what we do with your information:

• We will only use the information you provide for the purpose of administering the apprenticeship program and ensuring its smooth operation.
• We may use your contact information to reach out to you for an initial conversation, discuss your apprenticeship requirements, and guide you through the next steps.
• We handle your information in accordance with data protection regulations, ensuring that it is securely stored and processed.

Rest assured that your information will be handled responsibly and in accordance with applicable privacy laws and regulations.

You can find detailed information about the apprenticeship levy, including levy transfers, in the ESFA (Education and Skills Funding Agency) funding rules on the government website 
Apprenticeship funding rules - GOV.UK. The ESFA is responsible for administering the apprenticeship funding in England. Their website and documentation provide comprehensive guidance on the rules and procedures associated with the levy and its various aspects.

If you have any specific queries that aren’t covered in this document, please email TCC@QA.com or contact your QA representative.