Apprenticeship Funding for Employers
Updated for all new apprenticeship starts from 1 August 2026
Apprenticeships remain one of the most effective ways for employers to develop new talent, upskill existing staff, and strengthen workforce capability.
From 1 August 2026, the government has updated how apprenticeship funding contributions are described. The focus is now on what the government will contribute towards training and assessment costs, up to the funding band maximum.
This page explains how funding works for levy‑paying employers, non‑levy employers, and how contributions change depending on the apprentice’s age.
The Apprenticeship Levy
The apprenticeship levy is paid by large employers with an annual pay bill pay bill of over £3 million. Around 2% of UK employers pay the levy, which is charged at 0.5% of your total annual pay bill.
Levy‑paying employers manage their apprenticeship funds through the Digital Apprenticeship Service (DAS).
Through your DAS account, you can:
- Access and manage your levy funds.
- Add PAYE schemes used to pay apprentices.
- Select and approve training providers.
- Add apprentices and authorise training costs.
The apprenticeship levy is paid by large employers with a pay bill of over £3 million. Currently, only 2% of employers pay the levy, which is set at a rate of 0.5% of their total annual pay bill.
You can register and manage your levy account using the official guidance:
Levy funds can only be used for apprenticeship training and assessment. If your levy balance is not enough to cover the monthly cost of an apprentice, the government will contribute towards the remaining amount under the updated 2026 rules.
Funding for Levy Paying Employers (From 1st August 2026)
When you have sufficient levy funds
If your levy balance covers the full cost of training and assessment (up to the funding band maximum):
- 100% of costs are paid directly from your levy account.
- No employer contribution is required unless the negotiated price exceeds the funding band maximum.
When your levy funds are insufficient (New from 1 August 2026)
If your levy balance cannot cover the monthly instalments:
Apprentices aged 16–21
- Government funds 100%
- Employer pays 0%
Apprentices aged 22–24
- Government funds 95%
- Employer pays 5% (Unless the apprentice has an EHC plan or care‑experienced status, in which case government funds 100%.)
Apprentices aged 25+
- Government contributes 75%
- Employer contributes 25%
Employer contributions are paid directly to the training provider following an agreed payment schedule.
Funding for Non Levy Employers (From 1st August 2026)
For apprenticeships that start on or after 1st August 2026, the government has simplified and expanded full funding for non‑levy employers.
The previous age based and small employer criteria (including the 16–18, 19–24 with education, health and careplan (EHCP), and <50 employees rules) have been replaced.
Funding for non‑levy employers depends on the apprentice’s age at the start of their apprenticeship training.
Full Funding for Apprentices Aged 16–24
If you are an employer who does not pay the apprenticeship levy, the government will fully fund apprenticeship training and assessment costs (up to the funding band maximum) for apprentices who, at the start of their apprenticeship training, are:
- Aged 16 to 24 years old,
- 15 years old, if their 16th birthday falls between the last Friday of June and 31 August.
Funding for Apprentices Aged 25 and Above
If the apprentice is 25 or older at the start of their apprenticeship training:
- The government will fund 95% of the training and assessment costs (up to the funding band maximum).
- The employer will contribute 5%.
This replaces all previous rules relating to employer size (e.g., fewer than 50 employees) and EHC plan/care‑experienced criteria.
Setting Up Your Apprenticeship Account
To reserve apprenticeship funding, you’ll need to create an apprenticeship account. This allows you to manage funding, add apprentice details, and approve your chosen training provider.
You can follow the step‑by‑step guidance in the official help article or watch the support video provided on the Apprenticeship Service website.
Adding Your Apprentice and Selecting Achievement Training as your training provider
Once your account is set up:
- Add the apprentice’s personal and employment details.
- Select Achievement Training as your training provider using our UK Provider Reference Number: 10000099.
- Click ‘save and continue’, then ‘approve and send to training provider’.
After approval, your digital account will automatically notify Achievement Training that the apprentice has been registered.
Need Further Support?
If you would like to discuss the process or need help setting up your account, please contact David Kellier on 01752 202264.
Employer Incentives for Apprenticeships in 2026
The Government is delivering the largest package of apprenticeship employer incentives in over a decade. These incentives sit alongside fully or majority‑funded training for many apprentices aged under 25, and National Insurance relief where applicable.
Below is a clear breakdown of the four employer incentives available in 2026, who they apply to, and when they can be claimed.
1. Young Apprentice Payment – £1,000
Available now.
Applies when you recruit an apprentice who is:
- 16–18 years old, or
- 19–24 years old with an Education, Health and Care Plan (EHCP) or care‑leaver status.
Key points
- Available for employers of all sizes.
- Payments are processed by the training provider.
Paid in two instalments:
- 50% at 90 days
- 50% at 365 days
2. Foundation Apprenticeship Incentive – Up to £2,000
Available now.
Applies when you recruit a Foundation Apprentice who is:
- 16–21 years old, or
- 22–24 years old with EHCP, care experience, or a custodial background.
Key points
- Supports young people not yet ready for a full apprenticeship.
- Encourages progression into skilled employment.
- The apprentice may have joined your organisation up to 3 months before their apprenticeship start date.
Payments are processed by the training provider.
3. Non‑Levy Hiring Grant – £2,000
- Available from October 2026.
- Applies when a non‑levy employer recruits an additional apprentice aged 16–24.
Key points
- Available for employers of all sizes.
- Payments are processed by the training provider.
- Designed to support smaller businesses to expand their workforce.
- Sits alongside fully funded apprenticeship training for many 16–24 year‑olds (full funding for all 16–24s from August 2026).
4. Youth Jobs Grant – £3,000
Available now.
Applies when you hire an 18–24 year‑old who:
- Is on Universal Credit, and
- Have been seeking work for six months or more.
Key points
- Available for employers of all sizes.
- Payments are made directly to the employer.
- Managed by the Department for Work and Pensions (DWP).
- Designed to reduce recruitment risk and help employers engage young people who may struggle to access opportunities.
National Insurance Contributions (NIC) Relief
Employers may not need to pay Class 1 National Insurance contributions for eligible apprentices. You may qualify for NIC relief if the apprentice:
- Is under 25.
- Is on an approved apprenticeship standard or framework.
- Earns less than £967 per week (£50,270 per year)
The apprentice will still pay their own Class 1 NICs through their salary. This relief benefits the employer only.
You can read HMRC’s guidance on National Insurance contributions for full details.
Employers may not need to pay Class 1 National Insurance contributions for an apprentice, if the apprentice is:
- under 25 years old
- on an approved UK government apprenticeship standard or framework (these can differ depending on country)
- earns less than £967 a week (£50,270 a year)
The apprentice, as an employee, will continue to pay Class 1 insurance contributions through their salary, this will only benefit the employer.
Read HMRC’s guidance on National Insurance contributions.
Employer Agreement – Contract of Services
- Employers must meet the following requirements when hiring an apprentice:
- Employ and pay the apprentice in line with agreed terms and relevant employment legislation.
- Provide an apprenticeship agreement and a contract of employment within 13 weeks of the start date.
- Confirm the apprentice is employed for a minimum of 30 hours per week.
- Ensure the apprentice has time off to study within their working hours so they can complete all elements of their apprenticeship.
- Provide appropriate supervision, including a nominated mentor and deputy to ensure continuity.
- Ensure the apprentice’s job role allows them to gain the full range of skills and experience required by the apprenticeship standard.
- Support the apprentice to complete all components of the apprenticeship within contracted working hours.
20% Off‑the‑Job Training Requirement
All apprentices must complete 20% off‑the‑job training over the duration of their apprenticeship. You can read the official off the-job training guidance for more information.