Making the most of the apprenticeship levy in England: Understanding levy transfers

Apprenticeship levy transfers are a great way of making the most of the levy funding - for both the transferring employer, and the employer receiving the funds. 

After two years, funds are recouped by the Government on a monthly basis if the fund is not used or underspent by a levy-paying employer.

However, employers paying the levy can also transfer levy funds to another employer in a way that benefits both organisations.

For the employer receiving the funds, it is an excellent opportunity to develop staff through apprenticeships.

Transferring funds to another employer

For employers who pay the levy and have unspent funds there is the option of transferring up to 25% of the annual levy contribution to another employer. This transfer takes place through Apprenticeship Service, which also facilitates the transfer. These funds can be used to fund new apprenticeship starts in other organisations.

This could be with:

• Key business partners
• Businesses within the employer’s supply chain
• Businesses in the local area
• An organisation within its own employment sector area
• A local charity

The cost of the apprenticeship will be paid by the levy transfer, helping the employer receiving the funds develop skills within their workforce through work-based learning.

Receiving a transfer

Any employer can receive a levy transfer to help them recruit new apprentices.

Six steps to receive a levy transfer:

1. Receiving employer agrees terms (standard, cost and duration) with the transferring employer
2. Receiving employer sets up an Apprenticeship Service account
3. Transferring employer connects its Apprenticeship Service account to the receiving employer
4. Receiving employer selects the training provider to deliver apprenticeship
5. Transferring employer gives final approval online
6. The apprenticeship starts and monthly payments are made to the chosen training provider

More information on preparing transfers

The video from the ESFA will help you add apprentices funded by transfer to your account

Further Government guidance on transferring and receiving funds

Working with The Open University

Since 2016, The Open University (OU) has offered higher and degree apprenticeships. We have an expert team who are able to guide you through the process of sending and receiving transfers. We work with over 400 employers to provide apprenticeships across health, social care, policing, digital, leadership and management.

The OU has a long history and pedigree of working with employers to address skills gaps. Our flexible, work-based apprenticeships are designed to fit around business requirements and are scalable across multiple locations.

Please contact us to find out more about the programmes we offer and learn more about levy transfers.

Further reading

Apprenticeship funding rules

Help and resources are available for employers considering transferring funds and there are various sites which can be visited such as: Hire an apprentice or Fire It Up pages for general information about employing an apprentice. There is also a Government website: Find apprenticeship training to look at the different levels and types of apprenticeships.

Employers operating in Scotland, Wales or Northern Ireland, should check with the relevant apprenticeship authority for levy rules and information.

• Scotland
• Wales
• Northern Ireland