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Apprenticeship Funding is Changing in 2026, Here's Everything You Need to Know
- Anaïs Hegarty
- 1 day ago
- 4 min read
I went to the seminar so you didn't have to. Let's break it all down together.
So, I recently attended a briefing on the upcoming changes to apprenticeship funding, and honestly? A lot is happening.
Some of it is genuinely brilliant news for employers. Some of it requires action. All of it affects how you hire, train, and develop your people from August 2026 onwards.
Whether you're a business owner, an HR manager, or someone who's just heard the words "apprenticeship levy" and quietly panicked, this one's for you. Here's everything that's changing, explained in plain English.
First Things First: It's Not Called the Apprenticeship Levy Anymore
The Apprenticeship Levy has been rebranded as the Growth & Skills Levy. It's not just a new name; it comes with a new superpower. For the first time, levy funds can be used for shorter, bite-sized training, not just full apprenticeships. More on that shortly.
The Big Changes to Your Levy
Your funds now expire faster. New funds entering your account will expire after 12 months, down from 24. This applies to new contributions only; your existing pot isn't affected. The message here is clear: use it or lose it. If you've been sitting on your levy without a clear plan, now is the time to get one.
The 10% government top-up is ending. Currently, every pound you put into your levy account gets a 10% government boost on top. That ends on 1st August 2026. Your existing balance keeps its top-up, but new contributions won't be boosted going forward. It's not catastrophic, but it does mean your levy goes slightly less far, so spending it strategically matters more than ever.
If your levy runs out, co-investment (the amount you pay on top of government funding) rises from 5% to 25%. In practice, very few employers hit this point, but it's worth being aware of.
Great News for Smaller Employers
If your annual wage bill is under £3 million, there's some genuinely exciting news heading your way.
From 1st August 2026, apprentices aged under 25 will be 100% funded by the government. No employer contribution needed at all. If you've held back from taking on apprentices because of cost concerns, this removes one of the biggest barriers.
New Employer Incentives (and They Stack!)
This is where it gets really interesting. There are now several financial incentives available to employers, and in some cases, you can claim more than one at the same time.
Incentive | Who it's for | How much |
Apprentice Payment | Hiring apprentices aged 16–18 (or 19–24 with EHCP/care leaver) | £1,000 |
SME Incentive (from Oct 2026) | SMEs hiring apprentices aged 16–24 (new employees within 3 months) | £2,000 |
Foundation Apprenticeship Incentive | Hiring foundation apprentices aged 16–21 | £2,000 |
Universal Credit Incentive (Autumn) | Hiring 18–24 year olds who've been on UC for 6+ months | £3,000 |
Here's an example of how these stack: Say you're a small business and you hire an 18-year-old who's been on Universal Credit for over six months. You could be eligible for all three, that's £6,000 in incentive payments to your business, which you can spend however you like.
Some Apprenticeship Standards Are Being Withdrawn
Sixteen apprenticeship standards are being withdrawn, mostly from August 2026 (a handful by exception until December). The list includes some well-known ones:
Team Leader / Supervisor
Operations / Departmental Manager
Coaching Professional
Learning and Skills Assessor
Lead Practitioner in Adult Care
...and more
If you have learners already on these programs, don't panic, they remain fully funded through to completion. But if you were planning to start anyone on one of these, you'll want to act before the deadline.
Also worth knowing: the new Level 7 starts for learners aged 22+ stopped being publicly funded from January 2026. Existing learners are fine, but new enrolments are restricted.
Don't Forget: Minimum wage has gone up, too
From April 2025, the headline apprentice rate rose to £8.00/hour (up from £7.55). That rate applies to apprentices under 19, or those aged 19+ in their first year.
After that, they move onto the standard age-related rate, so an apprentice aged 21+ would be on the National Living Wage of £12.71/hour.
Budget accordingly if you're planning new starts!
So What Does All This Actually Mean for Your Business?
To put it simply: the opportunities have never been better, but you need a plan.
If you pay the levy, your funds expire faster, so use them strategically
If you're a smaller employer, under-25s could cost you nothing to train from August
Financial incentives are generous and stackable; it's worth calculating what you could claim
New shorter programmes mean you can respond to skills gaps quickly without committing to a full apprenticeship
Some popular standards are ending. If you want to start learners, don't leave it too late learning
Want to Know More?
This is exactly what we're here for at Everything Apprenticeships. Whether you want to know which programs are right for your business, how to maximise your levy before it expires, or how to access the new incentives, we've got the answers.
Drop us a message and let's have a chat. No jargon, no pressure, just straightforward advice to help you make the most of what's available.
Talk to our experts
If you're curious about how apprenticeships could work for your business, our team is always happy to talk.
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