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There are several benefits of apprenticeship schemes that make them appealing to businesses of all sizes.  

Any type of business in the UK can use apprenticeship schemes to recruit a new member of staff or upskill an existing employee, however, the processes and available funding varies slightly.  

Apprenticeship schemes for SMEs 

If you have less than 50 members of staff and you’re planning to recruit an apprentice aged 16-18, your SME is eligible for 100% funding for apprenticeship schemes.  

If your business has more than 50 employees or your apprentice will be over the age of 18 (there is no maximum age for apprenticeship schemes), your SME is eligible for up to 95% funding.  

The same rules apply regardless of whether you are recruiting a new apprentice or using apprenticeship schemes to upskill existing staff.  

To access this funding for apprenticeship schemes, you will need to reserve your funds by creating an Apprenticeship Service Account.  

Find out more about apprenticeship schemes for SMEs. 

Apprenticeship schemes for sole traders 

Sole traders are eligible for the same level of funding for apprenticeship schemes as businesses with fewer than 50 employees – i.e. 100% funding for apprentices aged 16-18 and 95% funding for apprentices aged 18+.  

However, sole traders will first need to register as an employer with the HMRC to receive an Accounts Office reference number that will enable you to pay apprentices through the PAYE system.  

Once you have registered with the HMRC, you can reserve your funds by creating an Apprenticeship Service Account. 

Apprenticeship schemes for large organisations 

If your company pays over £3 million in wages each year, you will contribute 0.5% of your annual wage bill to your apprenticeship levy fund. Your apprenticeship levy can then be used to pay for apprentices and apprenticeship assessments each year. 

Whatever is left of your apprenticeship levy funds at the end of the year is kept by the government so it is recommended that you use as much of these funds as you can to train apprentices or gift your apprenticeship levy to another organisation.  

As a levy-paying company, you'll automatically have an Apprenticeship Service account created to manage your funds, apprenticeships and training providers.  

Apprenticeship schemes for limited companies 

Limited companies are subject to the same rules for apprenticeship schemes as other businesses: 

  • If you pay wages over £3 million per year you contribute to the Apprenticeship Levy 
  • If you pay less than £3 million in wages you are eligible for government funding. 

Similarly to sole traders, to use apprenticeship schemes, limited companies must register as an employer with the HMRC to access the PAYE system.  

For all business types, once you have an Apprenticeship Service account you will be able to reserve funding for your apprenticeship scheme and select an apprenticeship training provider. 

Need help with getting started with your apprenticeship scheme?  

Our expert team is available to support you every step of the way and we can: 

  • Set up your Apprenticeship Service account 
  • Reserve apprenticeship funds on your behalf 
  • Advertise your apprenticeship vacancy (if required) 
  • Provide support to find and recruit an apprentice  
  • Start training. 

Read more about reserving apprenticeship funding or call us on 03333 222 666

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