Guidance

Apprenticeship technical funding guide from August 2026

Updated 29 July 2026

Applies to England

Introduction and purpose of the document

This document sets out the details of the apprenticeship funding system for new starts on or after 1 August 2026. It explains how we will calculate funding for organisations receiving funding from us. Employers may find this information useful to help understand how employer accounts on the Apprenticeship Service (AS) operate or how government and employer co-investment will operate.

This document does not apply to apprenticeship programmes that started before 1 August 2026; we will continue to fund these for the full duration of the apprenticeship under the methodology in place before this date. For information on earlier apprenticeship funding methodologies, see the previous versions of the apprenticeship technical funding guide for all apprenticeships that started between 1 May 2017 and 31 July 2026.

This document does not apply to apprenticeship units. To understand how apprenticeship units work you should read the apprenticeship unit technical funding guide.

To understand how the funding system works, you should read this document together with:

• 2026 to 2027 apprenticeship funding rules
• Individualised Learner Record (ILR) specification, validation rules and appendices
• ILR Reports guidance
• How to fix AS data mismatches

We may make changes to these documents.

Understanding our terminology

The terms ‘we’, ‘our’, ‘us’ refer to the Department for Education (DfE) or the Department for Work and Pensions (DWP).

We use the terms ‘you’ or ‘provider’ to refer to any organisation holding a funding agreement with us through which we directly route funds from an employer’s account or government-employer co-investment.

We use the term ‘employer account’ to refer to the on-line account where employers can manage their funding and apprentices, in the AS.

We use the term ‘levy payer’ or ‘levy-paying employer’ to refer to an employer who pays the apprenticeship levy, but also to an employer who does not pay the levy but is funding the apprenticeship through a transfer in the AS

We use the term ‘sending employer’ to refer to a levy-paying employer who transfers levy funds in their AS account to another employer to support their delivery of an apprenticeship standard. A ‘receiving employer’ is any (levy-paying or non-levy paying) employer who receives a transfer of funds in this way from a sending employer.

The term ‘apprenticeship assessment’ has replaced ‘end-point assessment’ for apprenticeships with the new apprenticeship assessment principles. Further details can be found in the changes to apprenticeship assessment 2025 to 2026 guidance.

Changes from the funding guide for starts from August 2026

We have added information about:

• apprenticeship units, which have a separate technical funding guide, and the implications this has for funding prioritisation order -changes to apprenticeship funding which will affect how levy funds are received, used, and co-invested:
  • employers will no longer receive the 10% government top-up on new funds, and unused funds will expire more quickly, after 12 months instead of 24
  • employer contributions will increase for levy employers who have insufficient funds, with higher co-investment rates applying to new apprenticeship starts where the apprentice is aged 25 or over at the start of their apprenticeship training
  • the expansion of the age range for those apprenticeships that government will fully fund for employers who do not pay the levy
  • the government will fully fund apprenticeships for levy employers who have insufficient funds for new apprenticeship starts where, at the start of their apprenticeship training, the apprentice is aged between 16 and 24 years old (or 15 years of age if the apprentice’s 16th birthday is between the last Friday of June and 31 August)
• apprenticeship hiring payments of £2,000 for employers who do not pay the apprenticeship levy if the apprentice is eligible as described in the apprenticeship funding rules (from 1 October 2026)

The data we use to calculate funding

You give us information about apprentices and their learning using the ILR service and the Earnings Adjustment Statement (EAS). We use this information to work out the funding you have earned for delivering this learning.

We will use information maintained by employers and you on the AS to calculate payments from that account, and if any co-investment is required from the employer and/or the government.

Funding bands

Every apprenticeship standard is assigned to a funding band. The table below shows the 30 funding bands that apply to all new starts from 1 August 2020. For historical funding bands, please refer to previous versions of the apprenticeship technical funding guide.

Band Number	Band Maximum
1	£1,500
2	£2,000
3	£2,500
4	£3,000
5	£3,500
6	£4,000
7	£4,500
8	£5,000
9	£6,000
10	£7,000
11	£8,000
12	£9,000
13	£10,000
14	£11,000
15	£12,000
16	£13,000
17	£14,000
18	£15,000
19	£16,000
20	£17,000
21	£18,000
22	£19,000
23	£20,000
24	£21,000
25	£22,000
26	£23,000
27	£24,000
28	£25,000
29	£26,000
30	£27,000

When an employer identifies the apprenticeship they need, they will negotiate a price with you for training. If required by the assessment plan, you (or the employer if they have chosen to do so) will select an organisation from the Apprenticeship Provider and Assessment Register(APAR) to deliver any apprenticeship assessment and negotiate a price with them.

For employer-providers, or providers delivering apprenticeships to their own employees, the initial price recorded will be the estimated cost of training and all assessment for each apprenticeship instead of a negotiated price (for more information, see the apprenticeship funding rules). We expect employer-providers to record the actual costs of delivering the apprenticeship at the end of the programme.

For the purposes of calculating earnings, we use the ‘total price’. This is the total cost of training and all assessment, and we do not calculate earnings separately for training, apprenticeship assessment or other assessment. For employer-providers or for providers delivering apprenticeships to their own employees, this refers to the actual cost of delivering the apprenticeships.

Where prior learning is assessed to have taken place, you must reduce the total price accordingly. Please see the apprenticeship funding rules for details around what price is eligible to be recorded.

The total price does not include:

• VAT
• additional payments, including the employer incentive payments for eligible foundation apprenticeships, which may be payable to you or the employer; see the ‘Additional payments’ section for more information
• apprenticeship hiring payments for non-levy paying employers
• the costs of learning support or delivering English or maths up to level 2

The funding band maximum caps the maximum amount that levy-paying employers can use towards an individual apprenticeship from their employer account. The funding band maximum also caps the maximum price that government will ‘co-invest’ against where an employer does not pay the levy or has insufficient funds in their employer account (including those funded through transfers where the sending employer’s account subsequently has insufficient funds) and is eligible for extra government support. Annex 1 shows an example of this.

The funding band maximum, which applies at the start of the programme, will continue to apply for the duration of the programme regardless of any changes in price, provider or employer. If the apprentice changes standard, then the funding band maximum on the date they change programme will apply.

Additional payments including employer incentive payments for eligible foundation apprenticeships, apprenticeship hiring payments for non-levy paying employers, English and maths, and learning support funding, are not subject to the funding band maximum and are not included when calculating whether the limit is applied to the total price.

If employers want to spend more than the funding band maximum, using their own money, they are free to do that and are responsible for paying you the additional amount in full.

The total price can be below the funding band maximum. The funding bands do not have a lower limit, and there is no lower limit to what we will co-invest.

You can find the list of standards eligible for public funding in the Find a learning aim service. We update this regularly. More information about eligibility for public funding is in the apprenticeship funding rules.

The earnings method

Qualifying period for funding

If an apprentice is in learning for at least the qualifying period, we count them as a ‘funding start’. We calculate the qualifying periods using the following table.

Length of the learning aim	Qualifying period
168 days or more	42 days
14 to 167 days	14 days
Fewer than 14 days	1 day

The qualifying period for apprenticeships is 42 days; it is only lower for apprenticeships when a break in learning occurs. If the apprentice takes a break in learning and then returns to learning, we will apply the qualifying period to the new programme aim before any monthly instalments are calculated. This also applies when the apprentice restarts for any other reason.

As an example, if an apprentice restarts an apprenticeship after a break in learning and the remaining planned period of the apprenticeship is 2 months, then the new qualifying period is 14 days.

If the apprentice leaves before the qualifying period for that learning aim (either the apprenticeship or an English or maths qualification), you will not earn any funding for that learning aim, including learning support. However, if you have already earned funding in a previous month before you recorded the ILR ‘Learning actual end date’, we will reclaim the funding.

If the apprentice completes a learning aim, we will count them as having met the qualifying period for that learning aim, even if it is before the end of the qualifying period. However, you should not record apprenticeship programme aims as completed before the minimum duration described in the apprenticeship funding rules.

Recording late data in the ILR

If an apprentice is continuing learning at the final R14 collection at the end of the year, but you record in the subsequent ILR year that they should have left in the previous ILR year, you may have earned funding that you need to pay back.

For example, at R14 in the 2025 to 2026 ILR, you record an apprentice as starting on 10 July 2026 and continuing. Then in the 2026 to 2027 ILR, you record them as leaving on 16 July 2026. In this scenario, they will have earned a monthly on-programme payment in July 2026 from the 2025 to 2026 ILR that will need paying back. This apprentice will appear in your FRM27 funding monitoring report (‘Continuing or completed learning aims that are now reported as withdrawn on or before 31 July of the previous funding year’).

In previous years, we have asked you to repay this funding through the EAS. However, we will now contact you separately after the R14 ILR return to recover the funding that relates to FRM27. You do not need to take any action in-year for this report. Do not submit repayments for FRM27 through the EAS.

For more information on recording late data in the ILR, please refer to ‘The impact of incomplete information’ in the ILR provider support manual.

Monthly instalments

We will base your earnings on monthly instalments so that funding follows the apprentice for as long as they stay on the apprenticeship.

There is a completion element for the apprenticeship. This is 20% of the lower of either the total price or the funding band maximum. We calculate the monthly instalments from the remaining 80%.

We spread these instalments equally over the number of planned months for the apprenticeship programme aim, based on whether the apprentice is in learning on each census date (the last calendar day of every month). The planned number of months is calculated from the ‘Learning start date’ and the ‘Learning planned end date’ in the ILR.

If the apprentice leaves early, for example, they withdraw from the programme, the monthly instalments stop. We will not calculate a monthly instalment for the final month if the apprentice withdraws before the last day of the month in which the learning stops.

We calculate funding for English and maths qualifications up to level 2 separately from the apprenticeship programme aim. We will split the rate into equal monthly instalments using census dates, and there is no completion amount.

The table below shows an example of how we spread earnings over time based on an apprentice starting on 1 August and completing on 10 August the following year. The cells with an ‘X’ represent the months when there are earnings. This example shows that English and maths qualifications can start at different times compared to the apprenticeship. The example assumes that all additional payments are due for this apprenticeship. For more information, see the ‘Completion and apprenticeship assessment’, ‘apprenticeship hiring payments’ and the ‘Additional payments’ sections.

	Aug	Sep	Oct	Nov	Dec	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug
Apprenticeship instalments	X	X	X	X	X	X	X	X	X	X	X	X	-
Apprenticeship completion	-	-	-	-	-	-	-	-	-	-	-	-	X
Additional payments [footnote 1]	-	X [footnote 2]	X	X [footnote 3]	-	-	-	-	-	X [footnote 4]	-	X	-
Employer incentive payments[footnote 5]	-	-	X	-	-	-	-	X	-	-	-	-	-
Apprenticeship hiring payments [footnote 6]	-	-	X	-	-	-	-	-	-	-	-	X	-
English instalments	-	X	X	X	X	-	-	-	-	-	-	-	-
Maths instalments	-	-	-	-	-	X	X	X	X	-	-	-	-

See Annex 1 for an example showing how earnings are calculated and paid.

Completion and apprenticeship assessment

We hold back 20% of the total price, capped at the maximum of the funding band, for completion. We will only release this when the apprentice completes their programme. See the apprenticeship funding rules for the definition of a completion.

The total price agreed with the employer will include the costs of delivering any assessment. You will be responsible for passing on payment for any assessment undertaken by an assessment organisation. The cost of assessment may not be the same as the 20% of the total price, which we withhold for completion. We expect that the cost of the assessment should not exceed 20% of the funding band maximum.

For apprentices on apprenticeship standards, the completion element is earned when you record an ‘Achievement date’ in the ILR and the ‘Completion status’ is recorded using code 2 (‘The learner has completed the learning activities leading to the learning aim’). You will earn this funding for the month of the ‘Achievement date’, even if this month is different to the ‘Learning planned end date’ or the ‘Learning actual end date’ of the programme.

If the apprentice completes their programme earlier than their ‘Learning planned end date’, you will also earn any remaining funds that were due to be earned in the month of the ‘Learning actual end date’ or ‘Achievement date’, as appropriate according to the paragraph above, providing the apprenticeship funding rules on minimum duration have been met. This is the balance between the earnings to date and the total agreed price of the apprenticeship (up to the maximum value of the funding band).

See Annex 1 for an example showing how completion is paid.

Co-investment

Where apprenticeship training is not funded from the employer’s account (for non-levy payers and levy payers with insufficient funds – including those funded through transfers that subsequently have insufficient funds), employers must co-invest a percentage of the agreed total price up to the funding band maximum.

For new starts on or after 1 August 2026, the government will contribute the following:

• for employers who do not pay the levy, if at the start of their apprenticeship training the apprentice is aged 25 or over, government will fund 95% of the training and assessment costs (up to the funding band maximum)
• for levy paying employers who have insufficient funds, where the apprentice is aged 25 or over at the start of their apprenticeship training, the government will fund 75% of the training and assessment costs (up to the funding band maximum) (see example C in Annex 1)

For apprentices who historically started between 1 May 2017 and 31 March 2019, the employer co-investment rate was 10%. For apprentices who historically started between 1 April 2019 and 31 July 2026 the rate was 5%. Please refer to the relevant apprenticeship funding rules for the age criteria and for any exemptions.

In cases where an apprentice changes employer or provider, but continues on the same apprenticeship as before, we will use the date the apprentice originally started the apprenticeship to determine the co-investment rate to use. The co-investment rate we use depends on the start date. See the ‘Co-investment waiver for new starts from 1 April 2024’ section for more information.

In any month where an employer’s account has a positive balance, but the balance is less than the payment(s) due (for apprenticeships and apprenticeship units), we will use all of the available balance in the employer’s account and the co-investment required from the employer of the remaining earnings up to the funding band maximum.

Employer co-investment up to the funding band maximum is not required if:

• the apprentice and employer were eligible for the extra support for small employers described in the ‘extra support for small employers’ section of this document – note this exception is only for starts up to and including 31 March 2024
• the apprentice started their apprenticeship training on or after 1 April 2024, but before 1 August 2026, with an employer who does not pay the apprenticeship levy and the apprentice was either:
  • aged up to 21 at the start of their apprenticeship training, meaning 16 to 21 years old at the start (or 15 years of age if the apprentice’s 16th birthday is between the last Friday of June and 31 August)
  • aged 22 to 24 at the start of their apprenticeship training and have been, or are, in the care of a UK local authority or has an Educational Health Care plan – see the ‘Co-investment waiver for new starts from 1 April 2024’ section for more information
• the apprentice starts their apprenticeship training, on or after 1 August 2026, with an employer who does not pay the apprenticeship levy or with a levy employer who has insufficient funds, and the apprentice is aged between 16 and 24 years old (or 15 years of age if the apprentice’s 16th birthday is between the last Friday of June and 31 August) at the start of their apprenticeship training – see the ‘Co-investment waiver for new starts from 1 April 2024’ section for more information

If the total price exceeds the funding band maximum, the employer is responsible for paying the difference in full, in addition to the co-investment amount.

We will use funds from a levy-paying employer’s account where appropriate, and this may reduce the amount of co-investment required. For more information, see the section on ‘Using employer accounts to pay for training and assessment’.

To be eligible for the completion element, you no longer need to collect the co-investment from the employer and report the cash value on the ILR. The completion payment will be paid once the apprentice has undertaken all the activity relevant to the apprenticeship, including completing all elements of the apprenticeship assessment. This applies to apprenticeships completing on or after 1 August 2026.

If you are delivering apprenticeships to your own staff, please record the Learning and Delivery Monitoring (LDM) code 356 (‘Apprenticeship being delivered to own employees’). We will monitor the use of this LDM code.

We will provide you with monthly reports to show which apprenticeships we have fully funded from the employer’s account and which apprenticeships will need co‑investment. These reports will tell you how much the employer is due to pay to you and for which apprentices. We will provide information to employers through the AS on how much they are due to pay each provider for co-investment where applicable.

See Annex 1 for an example showing how we pay for training and assessment through employer accounts or co-investment.

If an employer’s levy balance has been exhausted, and their apprentices are funded using co-investment, the apprenticeship contract type recorded in the ILR for apprentices they employ must remain as ACT1 (apprenticeship funded through a contract for services with the employer). This is because the underlying contract for services does not change when the levy balance fluctuates.

We will fully fund English and maths up to level 2, learning support and any additional payments including the employer incentive payments for eligible foundation apprenticeships at the published rates. The employer does not contribute to them. We fully fund these earnings and do not take them from the employer’s AS account.

Extra support for small employers for starts up to 31 March 2024

For starts up to and including 31 March 2024, we will waive the co-investment requirement for employers with fewer than 50 employees if the apprentice, at the start of their apprenticeship training, is a 16 to 18 year old or an eligible 19 to 24 year old as described in the apprenticeship funding rules. Where the employer is eligible for the co-investment waiver and pays the levy, we will not use their employer account funds.

We will pay 100% of the total price for these individuals, up to the maximum value of the funding band. You must identify the employers with fewer than 50 employees as a ‘Small employer’ (SEM) using the ‘Employment status monitoring’ fields in the ILR. You only need to record this field for starts up to and including 31 March 2024 – you must not record this field for new starts from 1 April 2024.

We determine whether we waive co-investment from the size of the employer at the start of the apprentice’s programme; this determines whether we waive co-investment for the rest of the apprenticeship with that employer.

We will continue to waive the co-investment if the employer grows to 50+ employees after the start of the apprenticeship as we base the eligibility for the waiver on the status at the start of the apprenticeship with that employer.

We will not apply this waiver to new starts after 31 March 2024.

Co-investment waiver for new starts from 1 April 2024

For new starts between 1 April 2024 and 31 July 2026, we will waive the co-investment requirement for employers who do not pay the levy where the apprentice is:

• aged up to 21 at the start of their apprenticeship training, meaning 16 to 21 years old at the start (or 15 years of age if the apprentice’s 16th birthday is between the last Friday of June and 31 August)
• aged 22 to 24 at the start of their apprenticeship training and have been, or are, in the care of a UK local authority or has an Educational Health Care plan
  • if the apprentice does not want their employer to know that they have been, or are, in the care of a UK local authority, then co-investment must not be waived. Providers must continue to collect co-investment as per the normal process
  • where the apprentice has given their consent to share this information with their employer, to waive the co-investment requirement, the provider will need to contact the AS support desk on 08000 150 600 or email at helpdesk@manage-apprenticeships.service.gov.uk. The support desk will then arrange for the co-investment waiver to be applied

For new starts from 1 August 2026, we will waive the co-investment requirement for employers who do not pay the apprenticeship levy, or where a levy payer has insufficient funds, where the apprentice is aged between 16 and 24 years old (or 15 years of age if the apprentice’s 16th birthday is between the last Friday of June and 31 August) at the start of their apprenticeship training.

Where employers are showing as levy payers in their AS account, but haven’t declared/paid any apprenticeship levy within the last 2 years (from when the apprentice starts), then in order to waive the co-investment requirement, employers will need to contact the AS support desk on 08000 150 600 or email helpdesk@manage-apprenticeships.service.gov.uk. The support desk will then talk employers through the process of how to update their AS account.

Where an apprentice changes employer and remains on the same apprenticeship, then the following will apply:

• where there is a change of employer, and the apprenticeship originally started prior to 1 April 2024, then the co-investment waiver (for small employers) will no longer apply meaning the new employer will be liable to pay co-investment (regardless of the apprentice’s age at the time (this also covers where an apprenticeship re-starts with a new employer))
• if the original apprenticeship start date is on or after 1 April 2024, then the non-levy status of the new employer (when the apprentice begins their new employment), and the age of the apprentice when they started their apprenticeship (with the original employer) will determine whether we waive co-investment (the age criteria will be based on the co-investment waiver rules that were in place at the start of the apprenticeship)

Where an employer is eligible for this waiver at the start of an apprenticeship, but subsequently starts to pay the levy during the apprenticeship, we will use funds from their account, if they are available, to calculate payments. If the amount of levy available that month is less than the earnings that month, we will fully fund the remainder under the co-investment waiver.

Payments on the AS and employer accounts

Non-levy employers and the AS

All new apprenticeship starts must be funded through the AS. You must use the ILR code ACT 1 for all new apprenticeships that started on or after 1 April 2021.

However, you should continue to use ACT 2 for continuing apprenticeships which were already coded as ACT 2. You should also retain ACT 2 codes on existing learning aims. If a programme aim started before April 2021 and is funded within a procured contract, then you should use ACT 2 on new component aims starting in April 2021 or later.

Funds entering employer’s accounts

Once employers have declared the apprenticeship levy to HM Revenue and Customs (HMRC) their employer account will update after the 22nd day of every month.

HMRC will use data about the home address of employees to calculate how much each employer will have to spend through the English apprenticeship system. HMRC will use this data to work out what percentage of each employer’s pay bill they pay to employees living in England. We show the percentage for each PAYE scheme in the AS.

HMRC calculate this percentage quarterly. Employers can update their employee’s address data on HMRC’s database by adding their home postcode to their real-time information tax return for 3 consecutive months.

We will assume that all employees are based in England when a PAYE scheme is created, until the next quarterly calculation date when we will re-calculate the percentage. This means that the percentage will default to 100% of funds if the calculation has not yet been run on a PAYE scheme.

The funding entering an employer’s account each month will be calculated as follows:

• monthly levy declared to HMRC
• multiplied by the proportion of the employer’s pay bill paid to their workforce living in England

Funds will enter the employer’s account shortly after the 22nd day of each month.

For employers that set up an account, or add a new PAYE scheme to their existing account, if they have made valid levy declarations to HMRC then we will add the funds to their accounts immediately. We will base the funds that we add to employer’s accounts on their levy declarations to HMRC to date, limited to the most recent 12 months of levy declarations.

We will apply any adjustments to the employer’s account if the cumulative year to date amount of levy declared to HMRC changes. We will also reflect end of year adjustments to the HMRC declaration in the employer’s account for the previous 12 months. We will apply these adjustments to the month that we receive the adjustment. After 12 months, any unused funds will be removed from the employer’s account (this also applies to any relevant top-ups that were previously added). For example, funds entering an employer’s account in September 2026 will become unavailable in September 2027 unless they are spent. Employers spend money from their account when it leaves the employer’s account as a payment to you.

The 12-month expiry period will only apply to funds entering accounts from August 2026 onwards. Any funds already in employer accounts before that date will continue to follow the 24-month expiry period.

The account will work on a first-in, first-out basis, through either payment or expiry. Whenever we take a payment from an employer’s account, we will automatically use the funds that entered the account first.

We will offset any negative adjustments against the most recent months’ unspent funds paid into the employer’s account, which will reduce the amount that is due to expire. Positive adjustments will expire in 12 months of being paid into an employer’s account if they are unused.

We may investigate the impact of large levy adjustments within an employer’s account, which may result in manual adjustments to the account if required.

Using employer accounts to pay for training and assessment

We automatically debit payments to the provider for apprenticeship training and assessment (including apprenticeship assessment for apprenticeship standards) from employer accounts where the employer has authorised us to do so.

Monthly earnings are paid:

• fully from the employer’s account if the employer has sufficient funds available
• partially from the employer’s account where the employer has some funds available, but these are not sufficient - the remaining balance will be paid through government-employer co-investment
• fully from government-employer co-investment if the apprentice is aged 25 or over (at the start of their apprenticeship training) where an employer has exhausted the levy funds in their employer account
• fully from government-employer co-investment if the apprentice is aged 25 or over (at the start of their apprenticeship training) and the employer does not pay the levy
• fully from the government where the employer is eligible for extra support for small employers; we will not use any funds from the employer’s account if they have one – note this is only for starts up to 31 March 2024
• fully from the government where the learner is eligible for the co-investment waiver for new starts between 1 April 2024 and 31 July 2026. See the ‘Co-investment waiver for new starts from 1 April 2024’ section for more information. In this case if there are funds available in the employer’s account (for example if the employer starts to pay the levy later in the apprenticeship) we will use these funds from their account first
• fully from the government where the learner is eligible for the co-investment waiver for new starts from 1 August 2026. See the ‘Co-investment waiver for new starts from 1 April 2024’ section for more information. In this case if there are funds available in the employer’s account (for example if the employer starts to pay the levy later in the apprenticeship) we will use these funds from their account first

The employer will be able to pause or permanently stop payments for an apprentice using the AS. This will apply to all future payments from the date at which the apprenticeship is paused or stopped. We will pay any outstanding payments up to this date. The employer can release the pause function at any time, and we will release the funding the next time the data is processed. Once an employer stops an apprenticeship, we permanently stop payments for this apprenticeship. You cannot reverse the stop; you must agree a new record for this apprenticeship.

We calculate payments to providers after the ILR collection closes each month. This applies to all payments from co-investment and from employer’s accounts.

See Annex 1 for an example showing how we pay for training and assessment through employer accounts or co-investment.

In our funding reports, we use a system of “funding line types” to categorise funding. For apprenticeships, the funding line types are determined at the point when the apprenticeship starts with the employer. We use the “non-levy” funding line types where the employer has not previously paid the levy at that point. However, in some cases the employer may start to pay the levy at a later date during that apprenticeship. This means you may see levy transactions against “non-levy” funding line types. For more information on funding line types see the ILR funding reports guidance.

When an employer adds each apprenticeship or apprenticeship unit to their  account, we will automatically allocate it a priority order; this includes those funded through a transfer. We will use this priority order to identify which apprenticeship and apprenticeship unit payments we fund first from funds in an employer’s account. Apprenticeship payments will be prioritised over apprenticeship unit payments.

Employers can control the priority in which payments are processed. This allows employers to choose the priority order in which providers’ payments are processed and paid from their account.

We will prioritise any apprenticeships or apprenticeship units funded through a transfer on the AS before any non-transfer funded apprenticeships or apprenticeship units. If an employer has agreed to fund apprenticeships or apprenticeship units through a transfer, we will prioritise apprentices first, followed by learners on apprenticeship units, ahead of the employer’s own apprenticeships and apprenticeship units funded using their levy.

If an employer has agreed to fund multiple apprentices using a levy transfer, the default priority order will be:

• the earliest date that the transfer of funds was approved (by the apprentice’s employer, the training provider and then the sending employer)
• the Unique Learner Number (ULN) in ascending order where apprentices share the date they were approved

If the sending employer (the employer who transferred the levy to another employer) either has insufficient levy funds in their account, or has exceeded their transfer allowance for that financial year, the apprentice’s employer (the receiving employer) will fund the training if they have their own levy balance available or through co-investment. Where this occurs, we will use the levy funds of the apprentice’s employer according to the priority ordering detailed in the next paragraph. We will pay for these apprentices in priority order alongside any other apprentices funded through that account.

For non-transfers, the primary ordering is by provider, so we prioritise all apprentices with one provider over all other apprentices with a different provider. If the employer does not change the provider order, apprentices will be automatically prioritised by:

• provider, based on the first time an apprenticeship was approved (by both the employer and provider) for that provider, then
• the date that the apprenticeship has been approved (by both the employer and provider), where there are multiple apprentices for the same provider, then
• ULN in ascending order where apprentices share the date they were approved in the employer’s account

Some apprentices may retain the original default ordering that we applied when we first moved to this system of apprenticeship funding, unless the employer has changed the order. The change to default ordering was made on 31 May 2017 and the original default ordering was by:

• the date the employer has added an apprenticeship to their account, then
• ULN where apprentices share the date they were approved in the employer’s account

Employer users with appropriate permissions within the AS can define the provider priority. This feature becomes active when employers add more than one provider to their account. If the employer changes the provider priority, this change will override the default provider priority.

If the employer does not change the priority of the provider, then the default priority order remains.

All approved apprentices with a provider will have their funding payments processed before any approved apprentices with providers of a lower priority.

Prioritisation example

We give the following example of the default prioritisation using three different providers: A, B and C, and a mixture of apprenticeships and apprenticeship units approved in May and September (we have used ULNs in the example for illustrative purposes and any correlation with a valid apprentice’s ULN is unintended).

The employer approves an apprenticeship (ULN 99) with Provider A on 1 May and this apprenticeship is given number 1 priority for payment in June.

The employer approves an apprenticeship unit (ULN 22) with Provider B on 1 May and the apprenticeship unit is given number 2 priority for payment in June, as apprenticeships are prioritised ahead of apprenticeship units.

The employer approves another apprenticeship (ULN 33) with Provider A on 2 May and the apprenticeship is given number 2 priority for payment in June because Provider A has priority over Provider B and apprenticeships are prioritised ahead of apprenticeship units. The apprenticeship unit (ULN 22) with Provider B is now updated to number 3 priority for payment in June. The employer approves 2 apprenticeship units (ULNs 88 and 55) with Provider A on 10 September. Assuming Provider A remains the default number one priority, the apprenticeship units are given number 3 and 4 priorities for payment in October. The apprenticeship unit (ULN 55) is given number 3 priority over the apprenticeship unit (ULN 88) because of ascending numerical order of the ULNs. The apprenticeship unit (ULN 22) with Provider B is now updated to number 5 priority for payment in October because Provider A has priority over Provider B. The apprenticeship (ULN 33) with Provider A approved in May retains its existing priority The employer approves an apprenticeship with Provider C on 10 September and the apprenticeship (ULN 11) is given number 6 priority for payment in October (assuming the default provider priority has not been changed) because Providers A and B have priority over Provider C.

Provider	Date apprenticeship approved	ULN	Provider priority	Apprentice priority for June payments	Apprentice priority for October payments
Provider A	01/05/2018	99	1	1	1
Provider B	01/05/2018	22	2	3	5
Provider A	02/05/2018	33	1	2	2
Provider C	10/09/2018	11	3	N/A	6
Provider A	10/09/2018	88	1	N/A	4
Provider A	10/09/2018	55	1	N/A	3

We will use the priority order at the time the ILR collection closes (see the ‘Matching data between the ILR and AS’ section) for payment processing.

The example below shows how we apply the priority order to calculate payments. An employer with an employer account balance of £800 has one apprenticeship and one apprenticeship unit that have each earned £500 this month (total = £1,000), and they are calculated in priority order:

	Employer account Priority order	Employer account Start balance	Employer account Payment	Employer account End balance	Co-investment Outstanding earnings	Co-investment Government contribution	Co-investment Employer contribution
1 Apprenticeship	1	£800	£500	£300	£0	£0	£0
2 Apprenticeship unit	2	£300	£300	£0	£200	£150	£50

We will not take funding for learning support from an employer’s account.

We will not take funding for English and maths up to level 2, learning support and any additional payments including the employer incentive payments for eligible foundation apprenticeships and the apprenticeship hiring payment (for eligible employers or apprentices) from an employer’s account. You can fund English and maths at level 3 or above as part of the total price, up to the funding band maximum.

Transfers allowance

We calculate an employer’s transfer allowance according to the levy declared in the previous tax year multiplied by the English percentage. We will calculate this in April each year.

The transfer allowance is calculated, around the start of each tax year, and is based on the total amount of levy declared (to HMRC) during the previous tax year, with the English percentage applied. The annual transfer allowance percentage is currently set at 50% (and is based on actual transfer payments taken within the financial year) - this allowance covers transfers for both apprenticeship units and the main apprenticeship programme.

We treat this as a cap for funds that employers can transfer in that tax year. Employers can only reach this cap if sufficient levy funds are available to make monthly payments for training throughout the year.

We will not carry over any unspent allowance into the next tax year’s allowance.

For the transfer allowance from the 2025 to 2026 tax year, the last time we will use funds from this allowance will be when we calculate payments from the ILR collection that closes in April 2026. This is the ILR collection relating to provision up to 31 March 2026.

We will take any payments calculated in May 2026 or later from the transfer allowance for the 2025 to 2026 tax year, if there is one. This includes cases where the delivery takes place in March 2026 or earlier, but where we have not calculated the payment until May 2026 or later, for instance if the data match described in the following section onwards was not initially successful for that apprentice.

If the transfer fails (meaning the sending employer does not have sufficient levy funds to cover the payment), then if the co-investment criteria is fulfilled (start date, age and levy status of the receiving employer), the co-investment waiver will apply (refer to the ‘Co-investment’ section). Where the co-investment waiver does not apply then it will be the responsibility of the apprentice’s employer to fund the training (either through their own levy funds (if applicable) or through co-investment).

Matching data between the ILR and AS

We will use data from ILR submissions to create and update learner records in the AS. We will also continue to match apprentice data from your ILR submissions with the data held in the AS, depending on the contract type the apprentice is being funded through (recorded as the ‘Apprenticeship contract type’ (ACT) in the ILR). If the apprentice is recorded as being funded through:

• ACT 1: a contract for services with the employer (for an employer on the AS, or an employer which has had levy transferred to them for that apprentice), then we will apply a data match. The employer must first approve payments to the provider from their employer account. The details for each individual apprentice on the employer’s account must match the ILR data for each individual apprentice (which is then submitted monthly by the provider), for payments to be made
• ACT 2: a contract for services with the DfE (for a non-levy paying employer without an account on the AS when the apprenticeship started), then we will not apply the data match. You should not use code ACT 2 for new apprenticeships which start on 1 April 2021 or later. See the ‘Co-investment waiver for new starts from 1 April 2024’ section for more details

The data values we will use to match are:

• an identifying number for the apprentice (the ULN)
• the provider reference number (UKPRN)
• the apprenticeship standard code from find a learning aim
• the total negotiated price
• an additional check to ensure that the start date on the ILR is not before the start of the record on the employer’s account
• the ‘Apprenticeship financial record date’ in ILR returns

If any of the values above (except the final one) change during the programme, the employer must record these changes on the employer’s account. If the price changes, the provider must also record the change using the ‘Apprenticeship financial record date’ on the ILR; for the data match to be successful. The date recorded on the ILR must be on or after the start date of the matching record on the employer’s account, and within the same calendar month.

If you submit your ILR file during a collection period, we will provide an indicative data match using data from the AS from the previous day.

You must submit your returns on Submit Learner Data.

We produce an ‘Apprenticeship Data Match’ report on Submit Learner Data for ILR returns; this will be blank if there are no data match errors. If there are errors during the ILR collection period, we do not show data match errors to employers. If you need to amend the details held on the employer’s account to fix the error, then both you and the employer will need to approve the amended record. You must ensure that you make any necessary changes to both the employer’s account and the ILR record before we close the ILR monthly collection so we can release funding. We give examples of errors shown to providers in this report in the guidance on ILR Funding Reports.

We use data from the AS as part of the matching process for apprenticeship funding. If changes are made in the AS after an ILR submission has been returned, including changes made to resolve data locks, providers must submit a further ILR return before Period End to ensure those changes are included in matching and funding calculations. We publish the ILR collection timetable as part of the ILR specification, validation rules and appendices on GOV.UK.

If a change in circumstance occurs for an apprentice during their programme, you and the employer need to record the detail of the changes on both the ILR and the AS. If the details of these changes do not match, we will not pay this funding. These circumstances include changes in price, employer and provider.

Following the close of the monthly ILR submission window, we will provide reports to employers and providers to identify apprentices who have failed the data match. We will show these errors to employers alongside the details of individual apprentices in their account, and to providers through further reports on Submit Learner Data. The errors shown at this point means that we will not pay the provider for that apprentice for that month and we will not debit these amounts from the employer’s account.

Once a record has passed the data match and we have paid funding, we will not recover that funding if the data subsequently changes and the data match now fails. You will not earn any subsequent funding after the data match fails until the data matches again.

We will not pay English and maths up to level 2, learning support funding and all additional payments including the employer incentive payments for eligible foundation apprenticeships and the apprenticeship hiring payments if the data match check fails, even though the payments would not come from the employer’s account.

We have published more information about how to fix AS data mismatches on GOV.UK.

Additional payments

Support for younger apprentices

We will generate additional payments totalling £1,000 for you (the provider) and £1,000 for the employer if the apprentice is defined as a 16 to 18 year old or an eligible 19 to 24 year old as described in the apprenticeship funding rules. For care leavers, we only generate the employer payment if the apprentice is content to share their care leaver status (with their employer), see the ‘Support for care leavers’ section for more information.

We will split these payments into two equal payments when the apprentice is still in learning at 90 days and 365 days. You must pass on the payment to the employer as required in the apprenticeship funding rules.

For apprenticeships which start on 1 August 2025 or later, if the apprentice is on a shorter apprenticeship (where the published ‘typical duration to gateway’ of the apprenticeship standard is less than 12 months), or on a foundation apprenticeship, the second payment will be generated at 242 days in learning instead of 365 days. If the apprentice is on an apprenticeship standard where the published typical duration is 12 months or more, but they complete their apprenticeship before 365 days, then these second instalments will not be paid. The typical duration to gateway can be found by searching the apprenticeship standard on Skills England and is found under ‘key information’ of the relevant apprenticeship standard.

We fully fund these earnings and do not take them from the employer’s AS account.

If the apprentice moves between providers on the same apprenticeship, we will use the date they originally started the apprenticeship with the first provider to determine their age.

Support for care leaver apprentices

For apprentices who first started an apprenticeship between 1 August 2018 and 31 July 2023, we will generate an additional payment of £1,000 for you to pass to the apprentice as a bursary, if the apprentice is an eligible care leaver as described in the apprenticeship funding rules. You will receive this in full when the apprentice is still in learning at 60 days and must pass it on to the apprentice within 30 days of receipt.

For apprentices starting their apprenticeship training on or after 1 August 2023, this bursary will be £3,000. It is payable in 3 instalments of £1,000 over the first year of the apprenticeship, if the apprentice is still in learning at 60, 120 and 300 days. You must pass each instalment on to the apprentice within 30 days of receipt.

For apprenticeships which start on 1 August 2025 or later, if a care leaver is on a shorter apprenticeship (where the published ‘typical duration to gateway’ of the apprenticeship standard is less than 12 months), or on a foundation apprenticeship, the third payment will be generated at 242 days in learning instead of 300 days. If the apprentice is on an apprenticeship standard where the published typical duration is 12 months or more, but they complete their apprenticeship before 300 days, then this third instalment will not be paid. However as described in the following paragraphs, the apprentice may still be entitled to further payments if they then go on to undertake another apprenticeship. The typical duration to gateway can be found by searching the apprenticeship standard on Skills England and is found under ‘key information’ of the relevant apprenticeship standard.

The first instalment will show on your remittance and will also show in your apprenticeship payment reports. The second and third instalments will show on your remittance advice but will not show in your monthly payments reports.

An eligible apprentice must only receive the bursary once. If we have already paid the full amount of the bursary to this apprentice through another provider, we will not pay you. We also monitor this to ensure that the apprentice receives this bursary only once and we may reclaim duplicate payments.

Where an apprentice who is eligible to receive a bursary of £3,000 leaves their apprenticeship before receiving the full bursary, due to a change in circumstances or a break in learning, they will still be entitled to further payments on a new apprenticeship until they have received £3,000 in total.

You record care leavers using the Learning delivery funding and monitoring type ‘EEF’ (Eligibility for enhanced apprenticeship funding) and code 4 ‘Entitlement to extended funding’.

As the apprenticeship funding rules set out, providers must give all apprentices aged up to and including 24 the opportunity to declare if they are a child in care or a care leaver.

Providers should inform apprentices of the bursary and the additional payments, including the employer incentive payments for eligible foundation apprenticeships, providers and employers may receive to support them during their apprenticeship. This should be done before or when the apprenticeship starts so that the payments can support the apprentice as soon as possible.

However, if for any reason eligibility for the bursary is not recorded until later in the apprenticeship, we will allow late claims via the EAS to pay bursaries in full, as long as they are made before the end of an apprenticeship and authorisation to claim is received from the department as other eligibility requirements need to be reviewed. See EAS statement guidance.

If a 19 to 24 year old apprentice does not want to inform the employer that they were previously in care, then please record the LDM code 362 (‘Apprentice care leavers’). This will not generate the additional payment for the employer, but it will generate the funding for you and the apprentice. We will not show the employer payments in the employer’s account. This is only for 19 to 24 year olds as a 16 to 18 year old automatically generates additional payments for employers, and withholding this may disclose that the apprentice was previously in care.

More information on the bursary can be found here on GOV.UK. It includes information on eligibility and links to advice and guidance for care leavers, employers and professionals working with care leavers.

If the provider is showing as having a debt (for example, they owe money to the department), the second and/or third instalment of the care leaver bursary payment will be offset against this. Although the payment will not physically be released, as the provider has benefited from this, they must pay the relevant instalment to the apprentice (as per the apprenticeship funding rules).

Support for apprentices on foundation apprenticeships

If a foundation apprenticeship attracts an employer incentive (as identified within the Skills England website page for that standard), we will generate payments (and pay them via the provider) as follows:

• after 90 days in learning, £667 will be paid if the apprentice is still undertaking their foundation apprenticeship
• after 242 days in learning, £667 will be paid if the apprentice is still undertaking their foundation apprenticeship
• a progression payment of £666 will be paid if the apprentice, upon completion of their foundation apprenticeship:
  • starts a new apprenticeship (which is not a foundation apprenticeship) within 6 months of the completion date of their foundation apprenticeship; and
  • remains with the same employer (within the same employer’s AS account)

This progression payment will be made after 90 days in learning on their new apprenticeship.

These employer incentives are additional to payments which may be generated if the apprentice also qualifies for the support for younger apprentices as described in ‘Support for younger apprentices’ section. If the apprentice qualifies for both payments, the payments will be made together; for instance, the total employer additional payment at 90 days would be £1,167.

Apprenticeship hiring payments for non-levy employers

From 1 October 2026, we will generate apprenticeship hiring payments of £2,000 for employers who do not pay the apprenticeship levy if the apprentice is eligible as described in the apprenticeship funding rules.

Before we make hiring payments to providers, we will validate employer HMRC PAYE data against data provided to us by the provider through the ILR. If this data shows an apprentice is ineligible, or data has not been provided to enable us to validate eligibility, we will not make the payment.

We will split these payments into 2 equal payments when the apprentice is still in learning at 90 days and 365 days. Providers must pass on the payment to the employer as required in the apprenticeship funding rules.

If the apprentice is on a shorter apprenticeship (where the published ‘typical duration to gateway’ of the apprenticeship standard is less than 12 months), or on a foundation apprenticeship, the second payment will be generated at 242 days in learning instead of 365 days. If the apprentice is on an apprenticeship standard where the published typical duration is 12 months or more, but they complete their apprenticeship before 365 days, then these second instalments will not be paid (they will only be entitled to the first instalment). The typical duration to gateway can be found by searching the apprenticeship standard on Skills England and is found under ‘key information’ of the relevant apprenticeship standard.

We fully fund these earnings and do not take them from the employer’s AS account.

If the apprentice moves between providers on the same apprenticeship, we will use the date they originally started the apprenticeship with the first provider to determine their age.

Other payments

English and maths

We will fully fund all appropriate English and maths training up to and including level 2. For more information on eligible training, refer to the apprenticeship funding rules.

The eligible English and maths aims are available on the Find a learning aim service. They are also in the downloadable learning aim databases, and you can identify them as common components in apprenticeship standards.

For starts from 1 January 2024, the rates for eligible English and maths aims rose to £724 or the Adult Education Budget matrix rate as at 1 January 2024 if that rate was higher. You can check the Find a learning aim service to find the latest rate for an English and maths aim delivered through the apprenticeships funding model.

You will earn equal monthly instalments over the planned period of the qualification. There is no completion element for English and maths.

If an adjustment is required due to prior learning, you must record data in the ‘Funding adjustment for prior learning’ field on the ILR.

We will continue to calculate eligible English and maths earnings beyond the programme end date if applicable when apprentices complete their programme.

We fully fund these earnings and do not take them from the employer’s AS account.

You should record English and maths learning aims in the ILR with the same ‘Apprenticeship contract type’ (ACT) in the ILR as the associated programme aim. Where the programme aim has code ACT1, a contract for services with the employer (for an employer on the Apprenticeship Service or if using a levy transfer to fund the apprenticeship), then any associated English and maths aims should have code ACT1. This is because the English and maths aims are part of the same contract for services, associated with an employer, even though we do not fund those aims from levy accounts. If the contract type changes on the programme aim, following a change in the apprentice’s employment, then the contract type(s) for English and maths aims should change on the same day.

Learning support funding

You can earn learning support at a fixed monthly rate of £150 through the ILR. This can only be claimed for months in which reasonable adjustments are provided to the apprentice and where evidence of costs can be provided. See the ILR specification for more information. If the cost of providing support to an apprentice exceeds the total earned from the fixed monthly rate, you can claim this excess through the EAS.

If you deliver part of an apprenticeship in less than one calendar month due to breaks in learning, and we do not generate the £150 rate from the ILR data, you may claim the value using the ‘Excess Learning Support’ column in the EAS.

If learning support is more than £19,000 you can claim exceptional learning support. For more information, refer to the apprenticeship funding rules.

If English and maths delivery up to level 2 extends beyond the apprenticeship programme end date, we will continue to pay learning support funding if the apprentice is eligible.

We fully fund these earnings and do not take them from the employer’s AS account.

Change of circumstance

This section describes some scenarios of changes either to the apprentice’s programme or with the relationships to providers and employers. We have included some principles and how we apply them to some specific scenarios. For further guidance on how to record these scenarios correctly on the ILR, refer to the ILR guidance.

Principles

When an apprentice’s circumstances change during their apprenticeship, the details of the change should be recorded in both the ILR and, if applicable, the AS.

Changes in price

If the apprentice changes provider, then you need to agree a new price and record this in the ILR together with the date the price applies from. The new provider will record a total price for the programme on the ILR using fields within the ‘Apprenticeship Financial Record’ entity in ILR returns.

When an apprentice returns from a break in learning, you should record the original total price at the start of the new programme aim in the ILR, unless the employer and provider have re-negotiated the price; if this happens, you should record a new total price.

For changes in total price, we will apply the new price from the ‘Apprenticeship financial record date’. After applying the funding band maximum, we will subtract any earnings to date and 20% of the new total price for completion. We will spread the remainder equally over the remaining planned duration.

If you wish to change a negotiated price, you should add the new price as an additional total negotiated price (TNP) record in your ILR, rather than changing the original records.

For example, if you renegotiate the training price (TNP1) in a funding year after the apprenticeship has started, then you must add another TNP 1 and, for apprenticeship standards, restate your old TNP2 (apprenticeship assessment price) for the new date.

In the example below, a training price (TNP1) of £3,500 and an apprenticeship assessment price (TNP2) of £500 is negotiated on 1 September 2023 at the start of an apprenticeship in the 2023 to 2024 ILR. On 23 November 2023, the training price (TNP1) is renegotiated to £3,000.

In your ILR for the original funding year, you would record your negotiated prices as follows:

AFinType	AFinCode	AFinDate	AFinAmount
TNP	1	01/09/2023	3500
TNP	2	01/09/2023	500

In your ILR for the following funding year, when you have renegotiated the price, you would record your negotiated prices as follows:

AFinType	AFinCode	AFinDate	AFinAmount
TNP	1	01/09/2023	3500
TNP	2	01/09/2023	500
TNP	1	23/11/2023	3000
TNP	2	23/11/2023	500

If you need to record a renegotiated price that took effect in a previous funding year after the close of R14, then you should refer to the ‘Recording late data in the ILR’ section. We calculate your funding assuming that what you recorded in your R14 for a funding year is correct, so we disregard any changes you make to a negotiated price in a past funding year.

If the apprentice changes employer, the provider and new employer should agree a price for the remaining training and assessment, we call this a ‘residual’ price. You should record this residual price in the ILR using the ‘Apprenticeship Financial Record’ entity in ILR returns. You record a residual training price as TNP3 and a residual apprenticeship assessment price as TNP4. These identify the price of the remaining training and/or assessment (including apprenticeship assessment for apprenticeship standards) to be delivered following this change in circumstance to an ongoing programme. We will use this price information to calculate the earnings for the remainder of the programme and match to the new employer’s account if they have one.

In the example below, a training price (TNP1) of £3,500 and an apprenticeship assessment price (TNP2) of £500 is negotiated on 1 September 2023 at the start of an apprenticeship in the 2023 to 2024 ILR. On 23 November 2023 the employer changes, so a residual training price (TNP3) is negotiated at £2,000, and a residual end point assessment price (TNP4) is negotiated at £500.

In your ILR for the original funding year, you would record your negotiated prices as follows:

AFinType	AFinCode	AFinDate	AFinAmount
TNP	1	01/09/2023	3500
TNP	2	01/09/2023	500

In your ILR for the following funding year, when you have negotiated the residual price, you would record your negotiated prices as follows:

AFinType	AFinCode	AFinDate	AFinAmount
TNP	1	01/09/2023	3500
TNP	2	01/09/2023	500
TNP	3	23/11/2023	2000
TNP	4	23/11/2023	500

If you record a residual price in the ILR, we will not deduct any previous earnings as the residual price entered represents the remaining price from this point forward. We apply the funding band maximum to the sum of previous earnings plus the new residual price. After applying the funding band maximum, we will deduct 20% of the residual price for completion and then spread the remaining cost over the remaining length of the programme.

Price episodes

A price episode is the date range that applies to a price or contract type, for an individual apprentice. We calculate price episodes from ILR data for apprenticeship programme aims, and we use them for calculating the earnings described throughout this document.

If the price or the contract type changes during the learning activity, we create a new price episode. If an apprentice is funded through a contract for services with the employer (for an employer on the AS), the data on the AS needs to reflect the price episodes shown in the ILR.

Price episodes start and end in the funding year (between 1 August and the 31 July in the next calendar year). If the episode starts on 1 August, then we use the earnings from previous years’ ILR returns as the starting point to determine what earnings remain as of 1 August.

Apprenticeship funding reports for providers will show separate lines for each price episode that we will fund.

Additional payments

If the apprentice changes provider or employer, then the first employer or provider retains any additional payments including the employer incentive payments for eligible foundation apprenticeships and/or the apprenticeship hiring payment for non-levy employers already made. The new employer or provider will receive any outstanding payments for which they are eligible. We add the number of days in learning with the first provider or employer to the days with the second provider or employer, to calculate when any remaining additional payments are due.

If the apprentice transfers to a new apprenticeship standard before they complete the first one, we consider this a new start. If the apprentice is still eligible for additional payments and/or the apprenticeship hiring payment for non-levy employers at the start of the new programme, these will be calculated and earned in the normal way. Any payments already received by the employer and provider for the initial programme are retained and new payments are earned for the new programme.

Funding band maximum

If the price agreed between the provider and employer changes, we will include any previous earnings for the apprenticeship and will only fund up to the band maximum that applied at the start of the programme.

If the employer or provider changes, we will include any previous earnings for the apprenticeship at a previous employer or provider (based on the ULN) and will only fund up to the band maximum that applied at the start of the programme across all instances of that apprenticeship for that apprentice.

If the provider changes, the total contributions from an employer’s account for a single apprenticeship across two or more providers will not be more than the funding band maximum. If the employer does not have an employer account, the same funding band maximum applies to the total earnings before the co-investment is calculated.

If the employer changes, the total earnings paid to the provider from an employer’s account will not be more than the funding band maximum for a single apprenticeship. The same funding band maximum applies to total earnings before we calculate the co-investment if one or both of the employers do not have an employer account.

Redundancy

The apprenticeship funding rules describe some circumstances when an apprentice may continue to be funded on their apprenticeship after they have been made redundant.

You must follow the advice around recording redundancy in your ILR that is laid out in the Provider Support Manual by maintaining the ACT and TNP records from the most recent period of employment for the apprenticeship.

In these circumstances, we fund the apprentice through 100% government co-investment up to the latest total price in place when the apprentice became unemployed. The value of monthly instalments we pay the provider will not change when the apprentice becomes unemployed, unless the instalments had previously been co-invested (in these cases we will begin funding 100% of monthly instalments).

This applies for the applicable times described in the apprenticeship funding rules or until the apprentice resumes their apprenticeship with another employer.

One of the scenarios where we will pay for an apprenticeship to be funded to completion is where the apprentice has completed 75% or more of the apprenticeship. To calculate if the apprentice was 75% of the way through their apprenticeship, we first calculate the total length in days up to the learning planned end date. We include the days that the apprentice spent with another provider on the same apprenticeship. We then calculate 25% of the total days and count that number of days back from the learning planned end date. If the apprentice is made redundant after that date, we will fund that apprenticeship to completion.

If any additional payments at 90 days or 365 days fall due during the period when the apprentice is not employed, the provider would receive their additional payments, but no additional payment will be earned for an employer.

If an apprentice is made redundant during a break in learning, the provider should contact the Service Desk for further guidance.

Provider mergers

If you have merged with another provider, resulting in continuing apprentices being returned under a new UKPRN, but with other data such as start dates and negotiated prices remaining the same, then we need you to record the information in a specific way so we can calculate the correct earnings.

This is because in this scenario the latest total negotiated price includes some earnings which were generated previously against a different UKPRN. This is funded differently from cases where the apprentice changes between unrelated providers, and there is a new negotiated price which does not include earnings from the earlier UKPRN. The 2 scenarios can look very similar in an ILR, so we ask you to use the pre-merger UKPRN (PMUKPRN) field to distinguish them.

To receive the correct funding for your apprentices for whom the UKPRN has changed due to a provider merger and for whom the price has not been renegotiated, you must follow the instructions in the ILR provider manual section called ‘A cohort of learners transfers to a new provider (due to a merger or conversion to academy)’. You must also record the PMUKPRN (PMUKPRN field in the ILR) for every apprentice that has changed UKPRN and whose price has not been re-negotiated because of a provider merger.

If prices were re-negotiated as part of a provider merger, you should not use the PMUKPRN field in the ILR, as this will cause us to calculate your funding incorrectly.

Example scenarios for changes of circumstances

Scenario A – the employer and provider negotiate a new total price for the programme

This scenario may occur if the apprenticeship assessment costs are re-negotiated (which could include changing the apprentice assessment organisation). You may also negotiate a new price if the apprentice requires additional learning for re-taking mandatory qualifications or their apprenticeship assessment.

If the new price is less than what we have already paid, we will make no further payments, including the completion element. We will reconcile both the provider and, where appropriate, the employer’s account with a negative adjustment in the next month.

If the total price has increased after the planned end date of the programme, we will withhold 20% of any increase in price (after accounting for the funding band maximum) as an addition to the existing completion element and assign any remaining earnings to the month of the price change.

If the total price has decreased after the planned end date of the programme, we will reduce any remaining completion element by the price decrease. If this price change is more than the completion element, we will apply any remainder as a negative adjustment to both the provider and, where appropriate, the employer’s account in the next month.

Scenario B – you retrospectively update the total price.

This scenario may occur if you agreed an incorrect original price.

If the employer has an employer account, they may need to make a corresponding change, unless the change is an ILR correction to match the value already in the employer’s account.

You should only make this type of change within the ILR year for the original ILR ‘Apprenticeship financial record date’ in ILR returns. You must not change any amounts or dates relating to financial records with dates in previous ILR years. If you identify a data error after the close of a previous ILR year, you must add a new financial record with a date in the current ILR year.

We apply the amended price back to the original Trailblazer financial record date/apprenticeship financial record date and we recalculate the earnings as described in the ‘Changes in price’ section and in scenario A.

Scenario C – the apprentice changes programme with the same provider

This scenario may occur if the apprentice changes job role.

The employer and provider will negotiate a new total price for the new programme, which must reflect any existing skills or skills gained under the previous programme, and record this in the ILR and the AS.

If the apprentice changes standard, we consider this a new start. If the apprentice is still eligible for additional payments at the start of the new programme, these will be calculated and earned in the normal way. Any payments already received by the employer and provider for the initial programme are retained and new payments are earned for the new programme.

If an apprentice completes an apprenticeship and starts another apprenticeship, we consider the second apprenticeship as a new start for calculating funding. For example, we could generate another set of additional payments if the apprentice meets the eligibility criteria at the start of the second apprenticeship. This applies even if there is a relationship between the first and second apprenticeships.

Scenario D – the employer chooses a new provider to deliver the apprenticeship

The employer and the new provider will negotiate a new total price for the remainder of the programme, and record this in the ILR and, if applicable, the AS.

We will account for the earnings from the first provider before we apply the funding band maximum to calculate the earnings for the second provider. The total contributions from an employer’s account across both providers will not be more than the funding band maximum for a single apprenticeship.

If the apprentice was defined at the start of their programme with the employer as a 16 to 18 year old or an eligible 19 to 24 year old as described in the apprenticeship funding rules, then the same age category will continue to apply with the new provider.

The employer will continue to receive additional payments. Any remaining additional payments not paid to the original provider, you can be paid as the new provider. We add the number of days in learning with the first provider to the days with the second provider, to calculate when any remaining additional payments are due.

If the apprenticeship is funded through co-investment, we will use the co-investment percentage which applied when the apprentice originally started with the first provider on that apprenticeship.

If the employer has already paid co-investment to you (the original provider), you will need to reconcile the co-investment that was due. Any differences in the amount received to the amount that is due must be repaid to the employer (where there has been an overpayment) or to you (where there has been an underpayment).

Scenario E – the apprentice moves to a new employer but remains on-programme with the same provider

The employer and provider will negotiate a new total price for the programme. You should record this price in the ILR as a residual price. We will use this to calculate the earnings for the remainder of the programme and match to the second employer’s account if they have one. The provider will not create a new programme aim record if the apprenticeship delivery continues without a break.

We will account for the earnings from the period with the first employer before we apply the funding band maximum to calculate the earnings for the period with the second employer. The total earnings paid to the provider from employer accounts and total earnings before co-investment is calculated will not be more than the funding band maximum for a single apprenticeship.

The provider will continue to receive additional payments. Any remaining additional payments including the employer incentive payments for eligible foundation apprenticeships not paid to the original employer you can pay to the new employer. We add the number of days in learning during the first period of learning to the days in the second period, and subsequent periods, to calculate if we will generate any remaining additional payments.

If the apprenticeship is funded through co-investment, then the co-investment rate that will be applied to the new employer will be determined by the following factors:

• the apprentice’s age when they originally started their apprenticeship training
• the co-investment rate that would have been applicable to the new employer at the time the apprenticeship training originally started

The above is only applicable if the apprentice’s original start date was on or after 1 April 2024. More information can be found in the co-investment sections.

You must reconcile the employer co-investment that was due from the original employer. Any differences in the amount received to the amount that is due must be repaid to the original employer (where there has been an overpayment) or to you (where there has been an underpayment). In the case of underpayment, this must be paid by the original employer.

Scenario F – the apprentice takes a break in learning

When the apprentice resumes learning, we expect you to enter a price against the new programme aim in the ILR. This price may be the same as you previously recorded for the programme but can be a revised price depending on the amount of learning now required. After applying the funding band maximum, we will subtract 20% of this price for completion and, if the price is not a residual price, we will subtract any earnings to date. We will spread the remainder equally over the remaining planned duration.

We will add the number of days in learning during the first period of learning to the number of days in the second period, and any subsequent periods, to calculate when we will generate any remaining additional payments including the employer incentive payments for eligible foundation apprenticeships.

If the apprenticeship is funded through co-investment, we will use the co-investment percentage that applied when the apprentice originally started.

Scenario G – the apprentice is made redundant and has more than 6 months of the planned duration of the apprenticeship remaining and has not completed 75% of the apprenticeship

We will fund the apprentice through 100% government co-investment up to the latest total price in place when the apprentice became unemployed, or up to the funding band maximum if this is lower. This applies for up to 12 weeks or until they resume their apprenticeship with another employer if this is earlier.

If you do not find a new employer within 12 weeks of redundancy, then all funding will stop and you must record the apprentice as a withdrawal on the ILR.

If any additional payments at 90 days or 365 days fall due during the period when the apprentice is not employed, the provider would receive their additional payment, but no additional payment will be earned for an employer.

Scenario H – the apprentice is made redundant within 6 months of their planned end date or after completing 75% of the apprenticeship

This scenario also applies if the apprentice is still on programme after their planned end date when the employer makes them redundant.

If the apprentice is made redundant more than 6 months before the planned end date, but has completed more than 75% of the apprenticeship, then this scenario only applies if the apprentice was made redundant on 15 October 2020 or later. Before that date, Scenario G would apply.

The apprentice is funded through 100% government co-investment for any remaining monthly instalments and (if applicable) for completion, based on the latest total price, or up to the funding band maximum if this is lower, in place when the apprentice became unemployed. This applies for the remainder of the programme or until they resume their apprenticeship with another employer.

If any additional payments at 90 days or 365 days fall during the period when the apprentice is not employed, the provider will receive their additional payment, but no additional payment will be earned for an employer.

Funding reports

We will continue to provide funding reports to show you what funding we have calculated for you. These will range from headline funding reports to detailed reports at apprentice level.

You will receive a set of reports when you submit your ILR data that will indicate how much you have earned. The report explaining how you will be paid those earnings; either through government co-investment, from an employer’s account, or a combination of the two, will not be available until after the ILR collection has closed for each month. This is so that we can match ILR data with the AS at the end of each ILR collection.

These reports will also show the amount of co-investment that is due from each employer and show to which employers you need to give additional payments.

For more information on funding reports, please see the guidance on ILR funding reports.

Processing and changes at the end of the funding year

This section describes what you and employers need to do by the end of the R14 ILR return date. It also describes how we manage changes and calculate payments when 2 ILR years are open at the same time.

Last date for changes

The last ILR collection for each funding year is currently ‘R14’. The date you must return each ILR collection to us is in Data Collection Timetable in the ILR Specification. For example, for the 2025 to 2026 funding year, the R14 ILR return date is 22 October 2026.

You must record any changes that happen up to 31 July in the funding year in the ILR by the R14 return for that year.

For employers using the AS, the same deadline applies to any changes that relate to information in ILR returns. Some examples include:

• if an apprentice started learning on 31 July or earlier, the information for that apprentice must be recorded and approved on the AS by the R14 ILR return date in October, and that apprentice must be included in the R14 ILR return
• if a price change was effective from a date in July or before, this must be recorded and approved in the Apprenticeship Service by the R14 ILR return date in October. You must also make the corresponding change in the R14 ILR return
• if an employer wishes to stop the funding for an apprentice, the ‘stop’ date in the AS must be:
  • in the current funding year (from 1 August to 31 July) or
  • recorded in the apprenticeship service before the R14 ILR return date in October if it relates to the previous funding year
• any data matching issues between the ILR and the AS relating to funding up to July must be resolved by the R14 ILR return date in October

We will not process any ILR price changes that are dated July or earlier, which are recorded after the R14 ILR return date. Instead, we will use the earnings from the previous year’s ILR return as at R14 to determine the starting point for calculations from 1 August onwards.

Payment processing after the funding year end

There is an overlapping period when you return ILR information about 2 funding years to us; this is from 1 August to the return date of the final ‘R14’ ILR collection.

During this overlapping period, we will process extra payment transactions with employers’ accounts in the Apprenticeship Service, soon after the R13 and R14 ILR returns. R13 and R14 ILR returns cover the same time period as the R12 ILR return and are generally used to correct earlier data. If there are no corrections, there will be no new transactions.

For employers, this means 2 extra payment transaction dates in September and October, which will use the levy balance as at the R13 and R14 ILR return dates.

For providers, we will add payments from the R13 and R14 transactions to the payments from R02 and R03 ILR returns respectively and paid at the same time as the R02 and R03 payments.

The ‘Apps monthly payment report’ shows the payments made following each ILR return date. As there could be extra transactions in employers’ accounts following the R13 and R14 return dates, and extra co-investment generated, there are columns in this report showing R13 and R14 payments relating to earnings from August to July. Further information is in the guidance on ILR Funding Reports.

Annex 1 – an example of calculating payments

To demonstrate how earnings are calculated in the new apprenticeship funding system, we have used the following scenario:

• the employer engages a provider to deliver an apprenticeship with a maximum band value of £15,000
• the apprentice was 25 at the start of the apprenticeship
• the employer negotiates a total price for training and assessment of £16,000
• the planned duration for the apprenticeship is 2 years (or 24 months)
• the apprenticeship is not eligible for any additional payments
• we assume that the employer has used the Apprenticeship Service (AS) to approve funding for the apprentices, and the ILR has matching data for each apprentice
• the apprenticeship started after 1 August 2026, so the amount of government funding is dependent on whether the employer pays the levy or not

As the total price is above the funding band maximum, the maximum that we will pay from an employer’s account is £15,000. This is also the maximum we will co-invest towards. This means that the employer is responsible for paying the £1,000 above the funding band maximum, in addition to any co-investment or funds paid from an employer’s account.

We calculate the earnings based on £15,000. We will retain 20% (or £3,000) of this amount until the apprenticeship completes. This leaves £12,000 spread equally over 24 months, resulting in on programme earnings of £500 per month (assuming the apprentice meets the census dates each month).

The monthly payments to the provider are:

Employer A – pays the levy and has sufficient funds in their employer account to cover the costs of training.

We source 100% of the monthly instalment is used from the employer’s account. We will not co-invest, so we debit £500 from their account

Employer B – does not pay the levy.

We will co-invest 95%, and the employer will be liable for the remaining 5%. This means we will pay £475 monthly, and the employer will be responsible for the balance (which is paid directly to the provider). See the apprenticeship funding rules for more information on how on collecting employer co-investment

Employer C – pays the levy but has insufficient funds in their employer account.

We use the funds in the employer’s account first. For the remaining amount, we will co-invest 75%, and the employer will be liable for the remaining 25%.

If we assume the employer has £200 available in their employer account in a particular month, then we use this amount first. This takes the employer’s account balance to zero and leaves £300 remaining that we will pay through co-investment. We will pay £225, and the employer will be responsible for the balance (which is paid directly to the provider).

1. Note the timing of the last payment will be different in some cases; see the ‘Additional payments’ section for more information. ↩

2. For starts before 1 August 2023 this was the only applicable additional payment for care leavers. ↩

3. For starts from 1 August 2023 the second care leaver payment. ↩

4. For starts from 1 August 2023 the third care leaver payment. Note this pattern will be different in some cases; see the ‘Support for care leaver apprentices’ section for more information. ↩

5. These employer incentive payments only apply to foundation apprenticeships. A third progression payment will be paid when/if the learner completes a foundation apprenticeship and starts another apprenticeship, meeting criteria specified in the apprenticeship funding rules. See the ‘Support for apprentices on foundation apprenticeships’ section. ↩

6. For apprenticeships which start on 1 August 2026 or later, if the apprentice is eligible for the apprenticeship hiring payment for non-levy employers, as described from section ‘Apprenticeship hiring payments for non-levy employers’. Note the timing of the second payment will be different in some cases; see the ‘additional payments’ section for more information. ↩