Apprenticeships funding incentive

Thinking about hiring an apprentice or just done so? This straightforward guide will ensure you understand how to apply for and receive your incentive payment.

What is the incentive payment for hiring a new apprentice?

When you recruit new apprentices between 1 August 2020 and 31 January 2021, you can apply for extra funding from 1 September 2020, to support your organisation.

The new payment is in addition to the existing £1,000 already paid to employers hiring a new apprentice who is aged:

  • 16-18
  • Under 25 and has an educational healthcare plan (EHCP) or has been in the care of their local authority

This means, when hiring an apprentice who is aged:

  • 16-24, you will receive £2000
  • 25 and over, you will receive £1500

therefore receiving up to £3000 for each new apprentice you hire.

What can the payment be used for?

The incentive payment is different to the apprenticeship levy and you can spend it on anything to support your organisation’s costs. For example, you could spend it on facilities, uniforms, your apprentice’s travel or their salary. And you don’t have to pay it back.

The payment comes directly from the government – just follow these three easy steps

1. Hire new apprentices between 1 August 2020 and 31 January 2021

Any organisation can apply for the payment, regardless of size or sector. The important points to remember are that you hire an apprentice who:

  • Is new to your organisation
  • Starts their contract of employment and their apprenticeship with you between the above dates. You’re also able to hire an apprentice who has been made redundant elsewhere, providing they are new to your organisation

2. When to apply for the funding

You can apply for the payment from 1 September 2020, after you’ve added new apprentices to your apprenticeship service account. You’ll need to provide your organisation’s bank details so you can be paid directly. We’ll need to confirm your details, so the government can make the payment.

3. How to apply for the funding

You’ll need a Digital Account to apply. To create or access your Digital Account visit create an account to manage apprenticeships

For help creating your account, you can call the Apprenticeship Service on 08000 150 600.

When will the payment be received?

The funding will be paid in two equal instalments – the first after your apprentice completes 90 days and the second after they complete 365 days of their apprenticeship. It’s expected the first instalment will be processed in January 2021.

How can SS&L help?

Somerset Skills & Learning offers a free apprentice recruitment service to Somerset businesses and our experienced, friendly team will advise and support you every step of the way. Call us on 0330 332 7997, email us at enquiries@sslcourses.co.uk or start a live chat below to find out how we can help you support and develop your workforce.