Fully funded for non levy payers hiring aged 25 and under
SMEs who do not pay the levy can get fully funded training and assessment for apprentices aged 25 and under, removing the previous 5 percent co investment charge.
Key Apprenticeship Levy Funding Changes for 2026
Key Apprenticeship Levy Funding Changes for 2026
Key changes at a glance
What this means for schools and trusts: Planning cycles tighten, account value changes, and costs can rise if levy funds run out. A clear start plan helps you protect budget and avoid losing funds.
Growth and Skills Levy from April 2026
From April 2026 the Apprenticeship Levy transitions into the Growth and Skills Levy, intended to offer more flexibility including modular and targeted training options.
Levy funds expire after 12 months
From April 2026 unspent levy funds expire after 12 months rather than 24 months, increasing the urgency to commit funds before they are reclaimed.
The 10 percent top up is removed
The automatic 10 percent top up that previously boosted levy paying employers digital accounts has been removed, reducing overall spending power.
Co-investment increases once levy funds run out
When a levy paying employer digital account balance is exhausted, the employer contribution increases to 25 percent, up from the previous 5 percent.
Wage increase and National Insurance savings
From April 2026 the apprentice minimum wage rises to £8.00 per hour. Apprentices under 25 earning below £50,270 remain exempt from employer National Insurance contributions.
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What this means for schools and trusts
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A shorter expiry window means you need a tighter start plan across the year, not just a once a year intake decision.
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The removal of the 10 percent top up reduces the value in the digital account, so prioritisation matters more.
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If your levy funds run out, the higher employer contribution can change what is affordable, especially for larger cohorts.
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Wage changes affect staffing budgets, while National Insurance exemptions for eligible apprentices can reduce costs for some roles.
Important: This page summarises the employer briefing on the Key Apprenticeship and Levy Funding Changes for 2026. It is written to help you and your setting understand what is changing and plan with confidence. For the most up to date rules and official guidance, always refer to Department for Education and government updates.
A simple planning checklist
Review your funding position
- Check your levy account balance and expected expiry profile
- Map likely starts across the next 12 months
- Agree who signs off starts and when
Plan for affordability
- Model what happens if levy funds run out
- Factor in wage changes for apprentices from April 2026
- Confirm where National Insurance exemptions may apply
Decide priorities
- Identify roles where apprenticeships reduce recruitment pressure
- Agree which cohorts matter most this year
- Match training choices to school improvement priorities
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We can sense check your plan and map suitable apprenticeship options to your workforce needs.
Frequently asked questions
Talk it through with a levy expert
Book a discovery call with a Best Practice Network Apprenticeship Levy Expert. We will help you interpret the changes for your context and map options to your workforce priorities.
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