Apprenticeship Funding & Grants Growth & Skills Levy

There are a range of government funding arrangements and employer incentives available, depending on your organisation, the age and circumstances of the apprentice, and the type of apprenticeship you choose.

100% training funding for eligible apprentices aged 16–24

For new apprenticeship starts from 1 August 2026, the government will fund 100% of training and assessment costs, up to the relevant funding band maximum, for eligible apprentices aged 16 to 24.

This applies to both levy-paying and non-levy-paying employers, subject to the funding rules.

If the cost of training is above the relevant funding band maximum, your business will need to pay the difference.

Most small and medium-sized employers do not pay the Growth and Skills Levy.

For eligible apprentices aged 16–24, the government will fund 100% of training and assessment costs up to the funding band maximum.

For apprentices aged 25 or over, the government will normally fund 95%, with your business contributing the remaining 5%.

This means apprenticeships can be an affordable way for SMEs and other non-levy employers to recruit and develop new talent.

Employers with a total annual pay bill of more than £3 million generally pay the Growth and Skills Levy at a rate of 0.5% of their annual pay bill, subject to the applicable allowance and rules.

Your levy funds are held in your apprenticeship service account and can be used to pay for eligible apprenticeship training and assessment, as well as other products available through the Growth and Skills Levy.

If you have exhausted your levy funds, the government will fully fund training and assessment for eligible apprentices aged 16–24, up to the funding band maximum.

For apprentices aged 25 or over, levy-paying employers who have exhausted their funds contribute 25%, with the government contributing the remaining 75%, up to the funding band maximum.

There are also a number of payments available to eligible employers when recruiting apprentices.

Up to £8,000 in employer incentive payments

Depending on your business and the apprentice you recruit, you could be eligible for up to £8,000 in government recruitment support payments if you do not pay the Growth & Skills levy, or up to £6,000 if you do.

The payments available include:

£1,000 Additional payment

Employers may receive £1,000 when recruiting an eligible apprentice who is:

· Aged 16-18

· Aged 19-24 with an EHCP (Education, Health and Care Plan)

· Aged 19-24 who has previously been, or is, in care

This payment is available in addition to government funding towards apprenticeship training costs, making it even more affordable to recruit young talent.

£2,000 Foundation Apprenticeship Incentive

Employers may receive £2,000 when recruiting an eligible Foundation Apprentice.

Foundation Apprenticeships are designed for young people and provide Level 2 job-specific skills and experience across a range of areas, including construction, engineering, health and social care, IT and digital, and more.

They are available to young people aged 16 to 21 or eligible young people aged 22 to 24 who have an EHCP (Education, Health and Care Plan) and are or have been in care.

£2,000 Apprenticeship Hiring Incentive

From 1 October 2026, eligible employers who do not pay the Growth and Skills Levy may be able to receive a £2,000 hiring payment when recruiting a new apprentice aged 16 to 24.

This funding is designed to help employers invest in young talent and reduce the cost of recruitment.

£3,000 Youth Jobs Grant

Employers may be eligible for a £3,000 Youth Jobs Grant when recruiting an eligible apprentice aged 18 to 24 who has been out of work and claiming Universal Credit for at least six months.

This payment is made directly to eligible employers by the Department for Work and Pensions.