Employers know by now that after two years, levy funds are recouped by the Government on a monthly basis if the fund is not used or underspent by a levy-paying employer.
But while the two-year timeline is well known, many employers aren’t aware that they have the option to transfer unused levy funding to other organisations.
In fact, from our experience with employers, many haven’t used the opportunity to allocate their unused funds to other employers at all – meaning their levy fund is going to waste.
How Transferring funds works
Employers who pay the apprenticeship levy and have unused funds can find employers who want to receive a transfer in a number of ways.
These levy paying employers can transfer a maximum of 25% of their annual funds, split between as many employers as they choose.
You can choose to allocate your unspent levy funding wherever you please – whether it be a smaller organisation that would benefit from the additional funding, or a charity that your organisation is already aligned with.
Transferred funds will be used to pay for the training and assessment cost of the apprenticeships as agreed with the receiving employer. These funds are paid monthly for the duration of the apprenticeship.
- Only levy-paying employers can make a transfer.
- Any employer can receive and use transferred funds.
- Sending and receiving employers have to be registered on the apprenticeship service.
- A transfer can only be used to pay for training and assessment for apprenticeship standards.
- Transfers can only be used for new starts, except where the apprentice is changing employer and an agreement to continue their apprenticeship with their new employer is through a transfer of levy funds.
Who can use it?
Any employer can receive a levy transfer to help them to recruit new apprentices. To receive a levy transfer there are six steps that need to be taken.
- Receiving employer agrees terms (standard, cost and duration) with the transferring employer.
- Receiving employer sets up an Apprenticeship Service account.
- Transferring employer connects its Apprenticeship Service account to the receiving employer.
- Receiving employer selects the training provider to deliver apprenticeship.
- Transferring employer gives final approval online.
- The apprenticeship starts and monthly payments are made to the chosen training provider.
How to Get Started
The apprenticeship levy transfer isn’t on many employer’s agenda as a priority – their focus is mainly on maximising their ROI from their own funding.
But for those employers who know that they won’t be able to use all of their levy funding, the transfer can have a huge impact on what other organisations are able to do in the apprenticeship field. The governments focus on apprenticeship incentives has increased during the pandemic, but the transfer protocol hasn’t been a priority.
As we move out of lockdown and into the summer season, many smaller organisations will be under additional pressure, and keen to make the most of returning to unrestricted opening. These organisations will be in need of additional resources to truly make the most of this period, and the transferral or apprenticeship funding is a potential opportunity to recruit new team members and upskill existing ones.
“As an SME, the levy transfer has allowed us to open up education routes for our staff, which we would otherwise find impossible to fund and access. Just IT took all the hard work out of applying and obtaining the levy transfer funds.”
Alay Patel – Clickon IT London
Whether you are an employer looking to transfer your apprenticeship levy funding before it expires, or an employer seeking apprenticeship levy funding you can contact us below. Our team will guide you through the process and help you to find ways to seek additional resources, or to share surplus funding with others.