Apprenticeship Levy · 2025/26

Apprenticeship Levy calculator UK (2025/26)

The Apprenticeship Levy applies to UK employers with an annual wage bill above £3 million. The levy rate is 0.5% of total annual payroll, with a £15,000 annual allowance that effectively sets the threshold at £3 million. Employers below £3 million pay nothing. Above that level, the levy is paid monthly through PAYE alongside employer NI. The funds paid into the Digital Apprenticeship Service (DAS) account can only be used to fund apprenticeship training and assessment — they cannot be withdrawn as cash. Use the calculator below to estimate your levy liability at any payroll level.

UK scope: England, Scotland, Wales and Northern Ireland employer payroll planning for the 2025/26 tax year.

Sample total cost

£40,363

£3,364 per month on £35,000 salary

Employer NI

£4,500

15% above £5,000 secondary threshold (2025/26)

Pension + overheads

£863

Baseline employer pension plus configured overheads

Key assumptions — UK 2025/26
Employer NI: 15% on earnings above the £5,000 secondary threshold
Employer pension: minimum 3% on qualifying earnings £6,240–£50,270
Employment Allowance: up to £10,500 off the NI bill for eligible employers
Worked examples: £30k salary → £34,464/yr · £35k → £40,363/yr · £50k → £58,063/yr

What this page helps you check

Use the live tools

Calculate employer NI and payroll cost Team payroll cost planner Cost of employing by salary Employer NI by salary Auto-enrolment pension calculator

UK assumptions used

Employer NI

15% above £5,000 secondary threshold for 2025/26.

Auto-enrolment pension

Minimum employer contribution 3% on qualifying earnings.

Employment Allowance

Up to £10,500 relief in 2025/26 for eligible employers.

Official UK references

HMRC rates and thresholds Employment Allowance Pensions Regulator guidance Our methodology Our source list

Frequently asked questions

What is the Apprenticeship Levy?
The Apprenticeship Levy is a payroll tax applied to UK employers with an annual wage bill above £3 million. It is charged at 0.5% of the total wage bill above a £15,000 annual allowance. The funds are paid into a Digital Apprenticeship Service (DAS) account and can only be used to pay for apprenticeship training and End-Point Assessment. Businesses that do not use their levy funds lose them after 24 months.
Who has to pay the Apprenticeship Levy?
All UK employers with a total annual wage bill above approximately £3 million. This includes all sectors — public sector organisations (including NHS trusts, local authorities, and universities) pay the levy as well as private sector businesses. Employers can check their liability by multiplying total annual payroll by 0.5% and subtracting the £15,000 allowance.
Can I transfer my Apprenticeship Levy funds to other businesses?
Yes. Since 2019, levy-paying employers can transfer up to 25% of their annual levy funds to other employers, including smaller businesses in their supply chain. From April 2024, the transfer limit increased to 50%. This allows large employers to support apprenticeship training in their supply chain or among smaller partner businesses.
What happens to unused Apprenticeship Levy funds?
Unspent levy funds expire 24 months after they entered your DAS account. If you pay levy but do not use it to fund apprenticeship training, the funds are effectively forfeited. Employers with large DAS balances and no apprenticeship programme should either start one or use levy transfer to support other employers.
Does the Apprenticeship Levy apply to part-time employees?
Yes. The levy is calculated on total annual wage bill — the sum of all employee gross wages including part-time, full-time, and any taxable benefits in kind. There is no adjustment or exclusion for part-time workers. The calculation is straightforward: total gross wage bill × 0.5% − £15,000 = annual levy due.

UK coverage only. Last reviewed: 04 April 2026. Estimates use 2025/26 assumptions and are for planning, not legal or tax advice.