Apprenticeship Funding Explained
How apprenticeships are funded – Updated from 1st August 2025
Apprenticeships are funded through a system of co-investment, where both employers and the government contribute towards the cost of training and assessment for apprentices aged 22 and over.
From 1st August 2025, the government will fully fund the cost of training for apprentices aged 16–21 employed by non-levy-paying employers. Employers who do not pay the apprenticeship levy and wish to employ or enrol an apprentice aged 22 or over will be required to contribute 5% of the total cost.
Funding summary for employers who do not pay the levy tax:
- Apprentices aged 16–21 at the start of the apprenticeship:
Fully funded – no employer contribution required - Apprentices aged 22 or over at the start of the apprenticeship:
95% government funded – 5% employer contribution required - Apprentices aged 22–24 with an Education, Health and Care (EHC) Plan:
Fully funded – no employer contribution required (if you employ fewer than 50 staff)
Please note that funding does not cover the apprentice’s wages. Apprentices must be paid at least the National Minimum Wage. For more information on the correct pay for an apprentice, please visit the gov.uk website.
If your apprentice is aged 16–18, they must receive at least the National Minimum Wage for the duration of the apprenticeship (though you may choose to pay more).
If your apprentice is aged 19 or over, they may be paid the apprentice rate during the first year of their apprenticeship. After this, they must be paid at least the National Minimum Wage for their age.
What can I use the funding for?
Funding can be used to train both new apprentices and existing employees. Apprenticeships are available across a wide range of roles and industries, and there are no upper age limits, meaning you can invest in staff development at any stage of their career.
What are the current costs?
The exact cost depends on the qualification.
As an example, a Team Leader Level 3 apprenticeship typically costs around £14 per month over 14 months, followed by a final payment of £54 in month 15.
Please note that while the overall cost remains the same, payment schedules may vary depending on contracted hours and whether the apprentice works full or part-time.
What about incentives?
Your business may be eligible for a £1,000 incentive payment when you recruit or enrol an apprentice aged 16–18.
Off-the-Job Training and the End-Point Assessment
Employers must allocate time each week for apprentices to complete off-the-job training. This means that at least 20% of the apprentice’s contracted hours must be dedicated to learning activities away from their usual duties. This could include practical training, theoretical learning, or completing written assignments.
At the end of the apprenticeship, the apprentice must complete an End-Point Assessment (EPA) to demonstrate the skills, knowledge, and behaviours gained throughout their programme. Depending on the qualification, this may include:
- Knowledge assessments
- Portfolio-based interviews
- Practical observations
Why Choose ATL
At Apprentice Team Ltd, we work closely with a trusted network of high-quality training providers to offer cost-effective apprenticeship solutions across a wide range of subjects.
With over 10 years’ experience in the sector, we pride ourselves on delivering a professional, reliable service tailored to your business needs.
We provide:
- Regular learning sessions every 2–6 weeks from experienced tutors to ensure apprentices receive the support they need to succeed
- Impartial advice and guidance to help you navigate the apprenticeship system
- A full organisational training needs analysis
- A free recruitment service to help you find the right apprentice
For further advice and guidance, please call one of our advisors today on 01246 278931, email info@apprenticeteam.co.uk, or fill in the contact form below:
