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Grants and funding for businesses

A group of people sitting at a table at a business event talking to each other

New Apprenticeship Government Incentives

(from 1st August 2020 until January 2021)

Apprenticeship Incentives

The government have recently announced additional incentive payments available to employers when hiring apprentices between 1st August 2020 and 31st January 2021.

  • Introduction of a new payment of £2,000 to employers in England for each new apprentice they hire aged under 25, and a £1,500 payment for each new apprentice aged 25 and over.
  • This applies to apprentices recruited from 1st August 2020 to 31st January 2021 and the apprentice mus be a new employee to the business. (Apprentices must not have been employed by the employer within 6 months prior to contract start date).
  • Payments will be in addition to the existing £1,000 payment the government already provides for 16-18 year-old apprentices, and those aged under 25 with an Education, Health and Care Plan.
  • To enable you to claim the incentive you have to reserve funding on The Apprenticeship Service account upfront. (Example: If a learner starts in October and you do not reserve funding until November you will not receive the government incentive of up to £2000)

How much will you receive?

£3,000 for each new apprentice recruited aged 16-18

£2,000 for 19–24 year olds and

£1,500 for individuals aged 25 and over.

  • Payments will be made in two instalments, 50% when the apprentice has been in learning for 90 days and the final 50% at 365 days.
  • Grants will be processed through the Apprenticeship Service.
  • There is no limit on the number of incentive payments that can be claimed for new apprentices. (Apprentices must meet eligibility criteria).

Reserving Apprenticeship funding through the Apprenticeship Service

The Apprenticeship Service is designed to help employers access new apprenticeship standards, training providers and funding for apprenticeships through an online service account.

The Apprenticeship Service puts employers in control and allows you to reserve funding for apprenticeship training. It also allows you to choose the type of

apprenticeships you want to start, the number of apprentices you take on, and the training provider that suits your needs.

By reserving funding in this way the Government will transfer 95% of the cost to the chosen provider and you (the employer) will fund the remaining 5% as your contribution.

Extra support for small employers
(Fewer than 50 staff)

Employers with fewer than 50 people working for them will not have to pay the 5% co-investment fee for an apprentice who is aged between:

  • 16-18 years old
  • 19-24 years old and who has previously been in care or who has an Education, Health and Care plan provided by their local authority

3 step registration process

  1. Create user account
  2. Add PAYE
  3. Confirm organisation

Once you have set up your account you’ll need to reserve funding.

What do I need to know?

  • Which apprenticeship standard will be chosen
  • What month the apprenticeship training will start

Before the apprentice starts their training, you can change the apprenticeship start date and standard.

When can I use reserve funds?

The reserved funds are available to use from the month of the apprenticeship start date and the following 2 months.

The reservation will expire at the end of the 3rd month if you do not use it.

Funding status explained

There are 3 funding statuses:

  • Active: You’ve reserved funds, but have not added or saved the apprentice’s details (if you can see ‘add apprentice details’ in your account, then the reservation is ‘active’).
  • Used: You’ve reserved funds and added the apprentice’s details.
  • Expired: You did not add or save the apprentice’s details to a reservation within the 3 months that the reservation covers

Example funding scenario

You choose January as the apprenticeship training start date. The funding reservation is valid for January, February and March and expires on 1st April.

To stop the reserved funds from expiring, you need to add apprentice details.

You can find further guidance on how to reserve funding by watching these helpful videos below.

For more information call 0115 945 7260 or email business@nottinghamcollege.ac.uk.