Apprenticeship funding rules explained

What is Apprenticeship Funding?

Apprenticeship funding is financial support given to employers towards the cost of training an apprentice. It is available to businesses of any size and could include direct government support for training costs or the apprenticeship levy (for large companies). In some cases, grants and local government funding are also available to help fund apprentice training (e.g., if an apprentice is a care leaver). There is no upper age limit for apprentices.

Apprenticeship funding rules vary year to year, so businesses must stay updated to understand eligibility criteria and available funding. Training providers like Logic4training can help to understand the ins and outs of apprenticeship funding and provide support in applying for it.

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Apprenticeship funding rules 2024/25

Funding support is outlined in the 2024-2025 Apprenticeship Funding Rules which apply to apprenticeships starting between August 2024 and July 2025.

If an employer has under 50 employees and the apprentice is under 21, the government will fund 100% of apprenticeship training costs. Additionally, incentive payments of £1,000 (paid in two instalments) are available to assist with onboarding for young apprentices and those who require additional support.

For non-levy paying businesses that fall outside of these criteria, SMEs are required to contribute 5% of the cost of training an apprentice. Additional support may be available via a levy transfer to cover the entire cost of training.

Funding for apprentices over 21

Apprenticeships have no upper age limit. Employers who hire an apprentice aged 21 or over (or 24 if the apprentice has an EHCP plan) can benefit from the co-investment model, where the government pays 95% of training costs. They can also apply for a levy transfer.

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What’s New For Apprenticeships in 2025?

2025 brings some of the biggest changes to apprenticeship funding in years. The government’s focus is shifting, new types of apprenticeships are on the way, and the funding rules are being rewritten to prioritise young people and the skills Britain needs most.

Here’s what you need to know:

Key Changes at a Glance

Foundation Apprenticeships

What are they?

• Paid, employed positions for young people (typically 16-21), designed as a stepping stone into a full apprenticeship.
• Linked to priority sectors and occupations. Think construction, engineering, and digital.
• Flexible structure: blends real work with skills training, making it easier for young people to get started.

Why the change?

• The government wants to make apprenticeships more accessible and help more young people get their foot in the door.

When do they start?

• First delivery expected August/September 2025.

What does this mean for employers?

• Access to a new talent pipeline.
• Foundation apprenticeships could be a low-risk way to bring in and develop young staff, especially in skills-shortage areas.

Shorter Duration Apprenticeships

What’s changing?

• Until now, all apprenticeships lasted at least 12 months, regardless of your experience.
• From August 2025, if you already have relevant skills or qualifications, you may be able to complete your apprenticeship in less time.

Who benefits?

• Career changers, upskillers, and those with prior learning.
• Employers looking to quickly qualify experienced staff.

How will it work?

• Eligibility criteria will apply (details expected in Spring 2025).
• Training providers (like Logic4training) will assess your prior experience and tailor your programme accordingly.

Why is this important?

• Reduces unnecessary training and speeds up qualification.
• Helps employers respond quickly to skills shortages.

Funding Refocus

What’s happening?

• The government is shifting funding away from higher-level apprenticeships (Level 7, Master’s) and putting more money into Level 2 and Level 3 programmes.
• From January 2026, Level 7 apprenticeships will see reduced funding, except for those aged 16-21 and current apprentices.

Why?

• To address critical skills gaps and support young people entering the workforce.
• To “rebuild Britain” by investing in the skills most needed across construction, engineering, and technical sectors.

What about adults and higher-level learners?

• There’s still support for upskilling, but the funding focus is now on those starting out or switching to priority sectors.

We’re ready to help you make the most of these changes, whether you’re starting your career or looking to upskill.

Off-the-Job Training

What is it?

• Off-the-job training is learning done outside your normal work duties. Think classroom sessions, online learning, or practical workshops.

What’s new?

• The minimum number of hours and expectations for off-the-job training have been updated for 2025.
• Providers must ensure apprentices get the right mix of practical and theoretical learning, tailored to their role.

Why does it matter?

• Off-the-job training is essential for developing real, transferable skills.
• It’s a funding requirement sono shortcuts!

How does Logic4training deliver?

• Our apprenticeships blend on-site experience with structured training at our industry-leading centres.
• We use the latest tech for blended learning, so you get the best of both worlds.

• Employers: If you’re hiring apprentices or upskilling your team, the new rules affect how you access funding and what you need to deliver.
• Training Providers: You must follow the latest rules for each apprentice’s start date.
• Apprentices: The rules shape your training journey, funding eligibility, and how your programme is delivered.

Note: The rules apply to apprenticeships starting between 1 August 2025 and 31 July 2026. If your apprenticeship starts before 1 August 2025, the 2024-2025 rules still apply.

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How Is Apprenticeship Funding Allocated?

The Apprenticeship Levy

• Large employers (payroll over £3 million) pay the Apprenticeship Levy and use their digital account to fund training.
• Non-levy employers (smaller businesses) pay just 5% of the training costs, with the government covering the rest.

Co-Investment

• For non-levy payers, the split is 95% government, 5% employer.
• Additional support is available for small employers hiring 16-18 year olds or those with EHCPs (Education, Health and Care Plans).

Funding Bands

• Each apprenticeship standard has a maximum funding band—this is the most the government will pay for training and assessment.
• Employers and providers can negotiate costs, but anything above the funding band is paid by the employer.

What About Devolved Nations?

The rules in this blog apply to England. Scotland, Wales, and Northern Ireland have their own apprenticeship funding systems.

If your apprentice works outside England for more than 50% of their hours, you’ll need to check the relevant devolved administration’s rules.

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Who Can Access Apprenticeship Funding?

To qualify for government funding, apprentices must:

• Be aged 16+ and start their apprenticeship after the last Friday in June of the academic year in which they turn 16.
• Have the right to work in England and spend at least 50% of their working hours in England. This includes remote and hybrid workers, but the hours must be regular and planned at the start of the apprenticeship.
• Do not use a student loan to pay for their apprenticeship. If transferring from a full-time course funded by a student loan, the loan must be terminated.
• Not duplicate training already funded from another source.
• Be able to complete the apprenticeship within the available time (e.g., not limited by visa or fixed-term contract).

Employers can only use apprenticeship funding for staff employed by them or a connected company/charity.

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Apprenticeship Wages in 2025

Apprenticeship wages in 2025 have seen a significant boost, reflecting the government’s commitment to making apprenticeships more attractive and fair for everyone involved. Here’s everything you need to know about what apprentices should be paid, when rates apply, and how to make sure you’re getting the right wage.

The 2025 Apprentice Minimum Wage Rates

From 1 April 2025, the minimum hourly wage rates are:

Your Rights as an Apprentice

• You must be paid at least the minimum wage for your category. No employer is exempt.
• You’re entitled to payslips and all the same employment rights as other employees, including paid holidays and sick pay.
• If you think you’re being underpaid, you can check your pay and report concerns to HMRC or get advice from Acas.

Why Has the Apprentice Wage Increased?

• The 2025 increase reflects an 18% rise for apprentices, the largest in years, aiming to keep apprenticeship pay competitive and fair.
• This helps attract more young people and adults into apprenticeships, especially as the government focuses on priority sectors.

Staying Compliant as an Employer

• Review your apprentices’ pay every April to ensure you meet the new minimums.
• Remember, underpayment can lead to penalties and reputational damage. Don’t risk it!

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Practical Steps for Employers

1. Check Your Eligibility

Contact our team for tailored advice.

2. Choose the Right Apprenticeship

Browse our apprenticeship programmes to find the best fit for your business.

3. Register for Funding

Set up your Digital Apprenticeship Service (DAS) account and link with Logic4training as your provider.

4. Plan for Off-the-Job Training

Work with us to create a training plan that fits your business needs and meets funding requirements.

5. Stay Informed

Subscribe to the Logic4training blog for the latest updates and expert insights.

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Funding your apprenticeship with Logic4training

We have the expertise and industry experience to support employers through all aspects of the apprenticeship process:

• Recruitment of an apprentice
• Tailored apprenticeship training programme that suits your needs
• Completion of compliance paperwork
• Funding support

We are here to make the process as easy as possible for employers.

Contact us to find out more.

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FAQs

What is the apprenticeship minimum wage in 2025?

The apprenticeship minimum wage in 2025 is £7.55 per hour for apprentices under 19, or 19+ and in their first year. After the first year, apprentices aged 19 and over must be paid the national minimum wage for their age group. Employers must review pay annually to remain compliant.

Who is eligible for apprenticeship funding in England in 2025?

To be eligible for apprenticeship funding in England, you must:

• Be aged 16 or over
• Have the right to work in England
• Spend at least 50% of your working hours in England
• Not be using a student loan for the same training
• Be able to complete the apprenticeship within the available time

For more details, see our Apprenticeships page.

Can existing staff start an apprenticeship in 2025?

Yes, existing staff can start an apprenticeship if the training delivers new skills relevant to their role and they meet the eligibility criteria. Employers can use apprenticeship funding to upskill their current workforce.

What are the new foundation apprenticeships?

Foundation apprenticeships are a new route launching in 2025, designed for 16-21 year olds. They offer flexible, paid roles linked to priority sectors, providing a stepping stone into full apprenticeships. Learn more about upcoming opportunities on our Gas Apprenticeships and Electrical Apprenticeships pages.

How do I set up apprenticeship funding as an employer?

Employers need to:

• Register for a Digital Apprenticeship Service (DAS) account
• Select your training provider as their approved training provider
• Plan off-the-job training and ensure eligibility criteria are met

What is off-the-job training and how much is required in 2025?

Off-the-job training is structured learning that takes place outside normal work duties, such as classroom sessions or online learning. The minimum hours and requirements have been updated for 2025. Logic4training ensures all apprentices receive the right blend of practical and theoretical training.

Are there changes to higher-level apprenticeship funding in 2025?

From January 2026, funding for Level 7 (Master’s) apprenticeships will be reduced except for 16-21 year olds and those already enrolled. The focus is shifting towards entry-level and priority sector apprenticeships.

Can remote or hybrid workers access apprenticeship funding?

Yes, as long as at least 50% of their working hours are spent in England, remote and hybrid workers remain eligible for apprenticeship funding. Hours must be regular and planned at the start of the apprenticeship.

How can I fast-track my apprenticeship if I have prior experience?

From August 2025, some apprenticeships can be completed in less than 12 months if you have relevant prior skills or qualifications.

Where can I find more information or get personalised advice?

Contact our expert team or explore our Insights blog for the latest updates, tips, and guidance on apprenticeships, funding, and training opportunities.

For the most up-to-date information, always check the official GOV.UK Apprenticeship Funding and consult Logic4training’s expert advisors.