Apprenticeship Levy Calculator, 2026/27

How this is calculated

The apprenticeship levy is charged at 0.5% of your total annual pay bill, meaning gross salaries, bonuses and most cash earnings subject to Class 1 secondary NIC, before deducting employer National Insurance itself. Every employer gets a fixed annual allowance of £15,000 to set against that charge.

In practice this means only employers with a pay bill above roughly £3 million actually pay any levy, since below that the allowance covers the full 0.5% charge. This calculator applies the allowance to your gross levy figure to show the net amount due for the year, then divides it by twelve to show the approximate monthly PAYE payment.

Connected companies or charities, those under common control, must share one £15,000 allowance across the group rather than each getting their own, so groups need to agree in advance how to split it between employers on the Employer Payment Summary.

What the levy pays for

Levy payments accumulate as digital funds in your apprenticeship service account, topped up with a 10% government contribution, and can only be spent on approved apprenticeship training and assessment costs for employees, not on wages or general training.

Funds expire 24 months after they enter your account if unused, so employers who pay the levy but do not run an active apprenticeship programme can lose the value entirely, which is a common reason companies review their training plans once they cross the threshold.

Practical points for growing companies

Because the £3 million pay bill threshold is not indexed in the same way as personal allowances, employers can cross it through ordinary wage growth or headcount increases without any change in policy, so it is worth monitoring your pay bill each tax year rather than assuming last year's position still applies.

Non-levy payers can still access apprenticeship funding through co-investment, where the government pays 95% of training costs and the employer pays the remaining 5%, so smaller companies below the threshold are not excluded from apprenticeship support.

Who has to pay the apprenticeship levy?

Any employer, or group of connected employers, with an annual pay bill above the point where 0.5% of the pay bill exceeds the £15,000 allowance, broadly a pay bill above around £3 million.

Is the apprenticeship levy the same as employer National Insurance?

No, they are separate charges. Employer NI is paid on individual employees' earnings above the secondary threshold, while the levy is a flat 0.5% charge on your whole annual pay bill, reported and paid through PAYE.

What happens to levy funds if I don't use them?

Funds in your apprenticeship service account expire 24 months after they are added if not spent on approved training, so unused levy contributions are effectively lost rather than refunded.

Can connected companies share the £15,000 allowance?

They must. Connected companies or charities under common control share one £15,000 annual allowance between them and need to decide the split at the start of the tax year via their PAYE submissions.