Are You Ready for the Levy?
A change is coming to large payroll businesses with effect from 6 April 2017 – the Apprenticeship Levy will apply to all businesses with annual payroll costs in excess of £3 million pa.
The levy is being implemented by the government to help pay for an expansion in apprentice training. Employers, both public and private sector, with a wage bill over £3 million will be required to pay the levy of 0.5% of the payroll. A ‘levy allowance’ of £15,000 per year will be subtracted from the 0.5% total.
The levy must be calculated and reported monthly via an EPS report and paid over with the usual PAYE & NIC deductions by 22nd of each month. Group companies with multiple payrolls only attract one annual allowance between them.
Once you have started paying the levy you get access to funding for training apprentices through the new HMRC apprenticeship service account. This allows you to reclaim your Apprenticeship Levy contributions as digital training vouchers.
The Apprenticeship Levy represents another on-going business cost, and a reporting and compliance requirement for your payroll.
If you need to understand the implications for your business or just want help managing the extra work, why not talk to us today?
Lewis Smith & Co. – Accountants for Sandwell Businesses