Apprenticeship Incentive

Are you looking at hiring an apprentice for your business?


As an extra incentive, the government has announced the following grant:


Employers will receive £3,000 for new employees of any age who start their apprenticeship from 1 April 2021 to 30 September 2021.


You can apply for incentive payments for these apprentices from 1 June 2021.


The incentive payment is in addition to the £1,000 employers already receive for hiring an apprentice who is either:

  • aged 16 to 18 years old

or

  • under 25 with an education, health and care plan or who has been in the care of their local authority

Apprentices who joined your organisation before 1 April 2021


For new apprentices who joined your organisation between 1 August 2020 and 31 March 2021 aged:

  • 16 to 24, employers will receive £2,000

  • 25 and over, employers will receive £1,500

You must apply for these apprentices before 31 May 2021.


Apprentices who joined your organisation from 1 April 2021


Employers will receive £3,000 for new employees of any age who start their apprenticeship from 1 April 2021 to 30 September 2021.


You can apply for incentive payments for these apprentices from 1 June 2021.


What you can use the payment for


The payment is different to apprenticeship levy funds, so you can spend it on anything to support your organisation’s costs. For example, on uniforms, your apprentice’s travel or their salary. You do not have to pay it back.


Eligibility

You can only apply for new apprentices who joined your organisation between 1 August 2020 and 30 September 2021.

You cannot apply for an existing employee who joined your organisation before 1 August 2020, even if they started an apprenticeship after this date.



There are also funding options available where the government will cover up to 95% of the course costs.


Course costs & funding


As an employer that doesn’t pay the apprenticeship levy, you pay just 5% towards the cost of training and assessing an apprentice.


The government will pay the rest up to the funding band maximum.


You’ll pay the training provider directly and agree on a payment schedule.


If you employ fewer than 50 employees, the government will pay 100% of the apprenticeship training costs up to the funding band maximum for apprentices aged:

  • 16 to 18

  • 19 to 24 with an education, health and care plan provided by their local authority or has been in the care of their local authority

If you exceed the funding band maximum, you’ll need to pay all the additional costs.

If your apprentice started before 1 April 2019, you pay 10% towards the cost of training and assessing your apprentice and the government pays the rest. This rate continues until your apprentice completes their training.

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