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The Apprenticeship Levy was introduced by the government in April 2017 and is designed to fund apprenticeship schemes – which allow employers to recoup some costs of providing training to apprentices – across the UK.

The Levy is a small tax charge, payable by all companies with an annual wage bill in excess of £3m. Specifically, the tax is 0.5% of the company’s gross payroll. It’s paid to HMRC alongside income tax and National Insurance. If separate companies form a group, their total payroll is used for the calculation – this prevents companies splitting into multiple smaller companies, with wage bills below the £3m threshold, in order to avoid the charge.

Contractor Umbrella are proud to be a Levy Network Donator, supporting the FCSA apprenticeship levy by donating to their fund to provide training on apprenticeships and other much needed programmes. You can find out how this fund could help your organisation by reading more here.

If you’ve read our article on how an umbrella company employee’s pay is calculated, you’ll know that the umbrella company pays the statutory costs of employment – such as Employer’s National Insurance and pension – from the funds received from your agency or end client. The Apprenticeship Levy is another one of these statutory costs, and so will appear on your pay calculation alongside these other statutory costs.

Before the Levy was introduced, and for a period following its implementation, there was an extended dialogue between recruiters, umbrella companies and HMRC regarding an exemption to the Levy for these parties who engage contractors under an overarching contract of employment. However, this dialogue was unproductive – so the Apprenticeship Levy remains a component of the statutory costs of employment on your pay calculation and is paid directly to HMRC.

Why Choose Contractor Umbrella?

Contractor Umbrella is the hassle-free, straight talking umbrella company that provides umbrella employment for UK based contractors and freelancers. Independently voted as the best umbrella company by the readers of Contractor UK.

As one of the most trusted umbrella companies in the UK, we guarantee our employees peace of mind, absolute compliance and complete security. We are one of the longest standing and most respected umbrella companies in the UK.

If you’d like to find out more, call us on 01206 591 000 or request a call back by completing our online form.

Benefits of working through Contractor Umbrella;

  • Fast and easy registration –  be ready to work in 24 hours, simply register online and we’ll take care of the rest.
  • Calculate your take home pay – use our online calculator to find out how much you could be taking home through Contractor Umbrella.
  • Same day payments – We offer same day payments as standard providing funds are received into our account by 9am, for no additional fee.
  • Our Service Guarantee – is our guarantee that you will be looked after at every step of the way.
  • Flexible Limited Company accountancy – when you sign up to our sister company Dolan Accountancy, you can transfer to Contractor Umbrella when umbrella employment better suits or your assignment sits inside IR35.
  • Employee Benefits at Contractor Umbrella there are many benefits available to you as our employee including Childcare Vouchers, our Employee Rewards Scheme, Group Pension Scheme, Foreign Currency Exchange, Contractor Accommodation, Contractor Mortgages and much more.
  • Expert Contractor Support Team – Every employee of Contractor Umbrella has access to our expert Contractor Support Team who are available to deal with any queries that you may have. You can get in touch with the Contractor Support Team, through the online chat, by email or by telephone.
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