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Transferring unused apprenticeship funds to other employers

If you are an organisation who pays the Apprenticeship Levy, but do not use all of your funds to support your own apprenticeship training did you know that you can transfer unspent funds to:

  • employers you currently work with
  • other employers in your industry
  • regional partners

How much can be transferred?

From April 2019, you can transfer a maximum of 25% of your annual funds and you can transfer funds to as many employers as you choose.
The apprenticeship service calculates this amount by:

  • the total amount of levy declared in the previous tax year
  • with the English percentage applied
  • plus the payment of 10% from the government

What transfers can pay for?

Transferred funds can be used to pay for the training and assessment cost of the apprenticeships agreed with the receiving employer.
Sending and receiving employers need to know that:

  • funds are paid monthly for the duration of the apprenticeship
  • only levy-paying employers can make a transfer
  • any size employer can receive and use transferred funds
  • sending and receiving employers have to be registered on the apprenticeship service
  • a transfer can only be used to pay for training and assessment for apprenticeship standards
  • transfers can only be used for new starts, except where the apprentice is changing employer and an agreement to continue their apprenticeship with their new employer is through a transfer of levy funds

Our highly experienced Apprenticeship Team at Newbury College can provide guidance, help and support if you are wanting to know more about transferring funds. Here are the basics…

How to start a transfer

The sending employer and the receiving employer need to agree how many apprentices, which apprenticeship standard and the cost.
Once both employers are registered on the apprenticeship service the employers must:

  • connect with each other
  • receiving employer to add the apprentice details
  • confirm the transfer

Employers who are transferring funds

Before you make a transfer from your apprenticeship account, make sure that you:

  • have enough funds to transfer to another employer
  • have a clear understanding of the forecasted cost to you, which will cover the duration of the apprenticeship you’ve agreed to fund through a transfer
  • understand you will be funding the total cost of their apprenticeship and not just the co-investment
  • agree with the employer who is receiving the transfer, details of the apprenticeships you’re funding
  • are aware of the funding rules around transferring apprenticeship funds

You should also know:

  • you can’t transfer funds to another employer if you currently receive a transfer
  • if you’re currently transferring funds to another employer, you can’t receive transferred funds to pay for your apprenticeships
  • transfer payments will leave your apprenticeship service account first, each month
  • if the apprenticeship stops, your transferred payments will stop as well

Employers who want to receive a transfer

If you want to receive a transfer from another employer, you must be aware of the following:

  • you can only use the transferred funds for apprenticeship training and assessment
  • transferred funds can only be used for apprenticeship standards
  • you’ll need to create an account on the apprenticeship service to receive the transfer and pay for apprenticeship training
  • you’ll need to sign an agreement with the Education and Skills Funding Agency (ESFA)
  • transfer payments will be made monthly from the sending employer to your apprenticeship account
  • if the apprenticeship stops then the funding will stop too
  • you won’t have to pay any funds back to the sending employer
  • if the employer sending you funds runs out of money, you must make the relevant employer co-investment contribution. Refer to the ‘Paying for an apprenticeship’ section of the funding rules for information on the rate that needs to be paid
  • a transfer can fund up to the funding band maximum of a standard, if the cost of training is more, you’ll have to pay the difference to the training provider
  • if a training provider transfers funds to you, they cannot deliver the training for that funded apprenticeship
  • funding rules around transferring apprenticeship funds

 

If you are interested in finding out more, please contact us on 01635 845229 or visit our Apprenticeships page.