inside FEATURES


Are you ready for the levy?


By NICKY WILLIAMS, Skills Manager at Business West


The levy can be spent on developing your workforce


I


n January 2017, every business in the UK with a salary bill of over £3 million will have received an email from the HMRC notifying them of their


intention to collect the apprenticeship levy from April this year. As a businesses owner, you may be aware that you


will have to pay a levy from April 2017 – but have you considered how it can be intelligently spent to help your business grow? The levy has been introduced as part of the Government’s vision to increase the quality and quantity of apprenticeships and reach the commitment of three million apprenticeship starts by 2020. The levy is a clear steer from the Government that businesses will need to start investing in skills & training. Collected from April 2017, employers with an annual


salary bill (and operating in the UK) of over £3m will be charged 0.5% of their annual pay bill. All levy payers will be given an allowance of £15,000 per year to offset against the levy; the remaining balance will be paid through the Pay as You Earn (PAYE) system monthly and these payments will appear in a 'levy account' the ‘Digital Apprenticeship Service’. Still think you will not be affected? You may not have a huge workforce; but many high growth, high


20 insight JANUARY/FEBRUARY 2017


value SMEs in the South West have a highly skilled workforce and high salary bills. A significant number of businesses will just tip over into the levy tax bracket or will do in the next few years. And the levy tax is only the start. Whilst a business


may not be directly affected by the levy, the way apprenticeships will be delivered and funded will also change from April 2017. With just a few months to go until the levy becomes


a reality, there are still a number of businesses that know very little about the changes to apprenticeship training or how to use the money to benefit their business and existing employees.


How can Business West help? Training raises the level of skills available in the economy, driving productivity and national prosperity. Economic benefits are great to a business when individuals achieve a higher level of qualification, increasing their productivity and become more valued in a company. So whilst this is good news, many businesses are not aware of how their levy account can be spent to develop the skills of their existing workforce as well as recruit and train new employees.


APPRENTICESHIPS


‘Employers


with an annual salary bill of over


£3m will be charged 0.5% of their


annual pay bill’


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