Levy employers have an annual payroll of over £3 million and pay the Apprenticeship Levy at 0.5% of their pay bill. They can use funds in their Apprenticeship Service account to pay for apprenticeship training and assessment.

Non-levy employers have an annual payroll of £3 million or less and do not pay the levy. The government funds most or all of the apprenticeship training cost. 

For non-levy employers, apprentices aged 16 to 24 are currently funded at 100% up to the funding band maximum. For apprentices aged 25+, the employer normally contributes 5% and the government pays 95%.

If a levy employer runs out of levy funds, different co-investment rules apply. For apprentices aged 25+, the government currently contributes 75%, with the employer contributing the balance up to the funding band maximum.

Protected off-the-job training is dedicated learning time that apprentices must receive during their normal paid working hours, away from their productive job duties. It must develop new knowledge, skills and behaviours directly relevant to the apprenticeship standard. Whilst some employer-led activities can contribute to these planned hours, where a qualification is involved apprentices often need 6 – 7 hours per week away from their workplace duties to study effectively.

The Apprenticeships (Miscellaneous Provisions) Regulations 2017 place off-the-job training on a statutory footing, requiring it to form part of an approved English apprenticeship and to be specified within the apprenticeship agreement, mandating this time must take place during normal working hours.

For apprentices starting from 1 August 2025, the previous blanket 20% calculation has been replaced by a minimum number of off-the-job training hours for each apprenticeship standard.