Essex Bookkeepers on What Businesses Need to Know About the Apprenticeship Levy

RAINHAM, U.K. - March 4, 2017 - PRLog -- Later on this year, large organisations will be subject an Apprenticeship Levy as the government changes legislation surrounding apprenticeships. Although it will mainly be large employers that are affected by the levy, there may well be some effect on small businesses too. So what do you need to know? Here Essex bookkeepers Office Assistants explain what the apprenticeship levy is, when it comes into effect and who will be affected by it.

The Apprenticeship Levy is a charge payable to HMRC via PAYE returns which will be applied to large employers in both the public and private sectors. Once the new legislation comes into force, employers that pay into the levy can also use it to fund apprentice training within their businesses.

The idea behind the levy says Lynn Watson, managing director of Office Assistants, is that it will encourage employers to invest in apprenticeship schemes, as well as raise additional funds to help improve the quality and quantity of apprenticeships.

The threshold for the levy will depend on the size of a business' payroll. Those businesses with a wage bill of over £3 million will be required to pay the charge. Therefore, as the levy will only apply to 2% of all employers, only larger SMEs will be affected.

If a company is over the payroll threshold, it will have to pay 0.5% of its payroll into the levy. With that, every employer will receive an allowance of £15,000 to offset against what they owe. This is why the levy is only being charged to those companies with a payroll larger than £3 million, as it means the £15,000 allowance could potentially offset the entire amount owed.

The levy comes into effect on 1^st April 2017, and is payable via PAYE. There has been a mixed response from businesses towards the levy. Some are worried that larger businesses will have to fund extra apprenticeships over their £15,000 allowance themselves. Others are welcoming the levy as a way to improve the quality of apprenticeship schemes.

If you're worried about the effect of the apprenticeship levy on your business, why not take some advice from professionals? Your local bookkeepers will be able to help you navigate through the new legislation.

Office Assistants offers bookkeeping services and much more to clients throughout the south east of England from their base in Rainham, Essex. For more information visit http://www.officeassistants.org.