Give back to schools by pledging unspent levy funds

The apprenticeship levy is a UK tax on large employers which is used to fund apprenticeship training.  It is payable by all employers with an annual pay bill of more than £3 million, at a rate of 0.5% of their total. The levy is paid into a central digital apprenticeship service (DAS) that employers can access. Funding is available for both new and existing employees and the training must be delivered by an approved training provider

The Levy Funds are accessible to an organisation for 24 months before any unspent funds are returned to the treasury. Each year millions of pounds of unspent Apprenticeship Levy funding are return to the treasury, funds that could have been used to support apprenticeship training elsewhere.

One way larger organisations and Multi-Academy Trusts (MATs) can use their levy funds is by pledging them, transferring the funds to a smaller organisation. By doing this, trusts can support smaller education providers that may otherwise struggle to access vital training and development opportunities.

Why should you pledge your unspent levy funds?

Pledging your unspent levy funds can help support smaller organisations and the education sector as a whole and help your organisation make a positive impact.

By pledging levy funds to a smaller organisation, these schools can access apprenticeship training for teachers, teaching assistants, and support staff creating more qualified educators across the sector, boosting recruitment, retention, and morale.

How to pledge your unspent levy funds?

To pledge your unspent levy funds you need to login to your Apprenticeship Service Account. Once logged in, select “Your transfers” and then “Create a transfer pledge”.

Through the service you can choose from two transfer options:

1. Pledge and transfer your levy funds so other businesses can apply to you for funding.
2. Make a transfer to a business you know by inviting them to make a connection.

Transfer allowance

Your transfer allowance is calculated as 50% of your previous financial year’s apprenticeship levy funds. The apprenticeship service calculates this amount as 50% of:

• the total amount of levy you declared in the previous tax year
• with the English percentage applied (the percentage of your employees that live in England)
• plus, the top-up payment of 10% from the government

You cannot transfer more than your 50% allowance in each financial year.

From 22 April 2024, the transfer allowance raised from 25% to 50% of your previous financial year’s apprenticeship levy funds.

Learn more about transferring your apprenticeship funds.

LMP Education’s levy strategy

LMP Education can support your organisation in planning your apprenticeship levy spending strategy, ensuring that no funds go unspent. If you would like to discuss your levy spending please book a discovery call with the LMP Education team.