Large employers that pay the apprenticeship levy can choose to transfer up to 25% of their levy funds each year to other businesses, to pay for their apprenticeship training and assessment.

Transferring levy funds is a way of supporting other businesses by deciding which sectors, skills or local areas you’d like to fund.

Large employers' transfer allowance

A businesses transfer allowance is calculated as 25% of its previous financial year’s apprenticeship levy funds. The apprenticeship service calculates this amount as 25% of:

• the total amount of levy declared in the previous tax year
• with the English percentage applied (the percentage of your employees that live in England)
• plus the top-up payment of 10% from the government

Businesses cannot transfer more than your 25% allowance in each financial year.

Who can businesses transfer their apprenticeship levy to?

It is each individual businesses choice which companies it transfer levy funds to. Any business can receive a transfer of levy funds, including businesses that pay the apprenticeship levy and those that do not.

All businesses will need an apprenticeship service account to receive a transfer of levy funds. Businesses that pay the apprenticeship levy can choose to either send or receive a transfer of levy funds, but cannot send and receive a levy transfer at the same time.

What can levy transfers pay for?

Transferred funds can only be used to pay for apprenticeship training and assessment up to the funding band maximum.

Transfers can only be used for a new apprentice start. This doesn’t mean the apprentice has to be a new employee. It means you cannot receive transfer funding for an employee who has already started their apprenticeship.

The exception to this is when an apprentice changes employer. The apprentice can continue their apprenticeship with a new employer, funded by a transfer of levy funds.

What is a businesses level of commitment when transferring levy funds?

As all apprenticeships are a minimum of 12 months and they may start at any point in the year, businesses are agreeing to transfer funds over multiple financial years.

When agreeing to make a levy transfer, businesses should think about the amount of levy funds they expect to have available over the course of future financial years.

What is a business responsible for when transferring levy funds?

When a large business transfers levy funds, it is only responsible for paying for the cost of apprenticeship training and assessment until completion.

It is not liable for any other aspect of the apprenticeship such as the apprentice’s wages or their employment. This is the responsibility of the business receiving the transfer funding.

How to pledge and transfer levy funds

Businesses can pledge and transfer levy funds from within their apprenticeship service account by selecting ‘Your transfers’ then ‘Create a transfer pledge’.

To read more about transferring apprenticeship levy funds to another business, visit gov.uk.