Apprenticeship Levy
The Apprenticeship Levy takes effect from April 2017
If you are subject to the new levy it will be charged at a rate of 0.5% of NI contributions
It will be in addition to, and not instead of the CITB levy!
The threat in detail
The Apprenticeship Levy takes effect from April 2017, and is part of Government’s plan to create an additional 3 million apprenticeships by 2020.
If you are subject to the new levy it will be charged at a rate of 0.5% of earnings that are subject to secondary Class 1 National Insurance Contributions (the pay bill). Whilst 0.5% doesn’t sound substantial, a large pay bill can accumulate a hefty levy, and could equate to up to a 9% reduction in profits (depending on your structure).
Each employer will receive an annual allowance of £15,000 to be offset against their levy payment, with HMRC regulating the assessment, payment, collection and recovery of payments, and will be collected by HMRC through RTI.
The Dual Levy Burden
The Construction Industry Training Board (CITB) has been in existence since 1964 with the sole purpose of providing or facilitating training for the construction industry. Construction employers pay a statutory levy to fund the CITB.
This means that some construction employers will be paying both the CITB Levy and the Apprenticeship Levy — a dual levy burden that can significantly impact profitability.
What is the solution?
Why work with EEBS?By supplementing your employed workforce with self-employed tradesmen engaged through EEBS, you can both mitigate your exposure to the levy, and react to variations in workload in a more cost effective manner.
The cost of engaging a self-employed worker is up to 40% lower than that associated with employment. EEBS creates an unbreachable legal firewall between yourself and the sub-contractors that prevents HMRC from reclassifying the individuals as your employees, allowing you to match workforce to workload.
By partnering with EEBS, you benefit from:
Up to 40% lower costs compared to employing tradespeople directly
An unbreachable legal firewall preventing HMRC reclassification
The flexibility to match your workforce to your workload
Reduced exposure to both the Apprenticeship Levy and CITB Levy
“We are confident that we can rely on EEBS to keep us up to date with any changes and ensure we continue to comply.”
Christine Shearing, Kenwood Groundworks
“We have used EEBS for 7 years now and we cannot fault their service. They keep us up to date with new legislation and regularly carry out compliance reviews. Their staff are friendly and knowledgeable and the processing rates are fair.”
Google Review
“Superb service from EEBS. They handle all our HMRC verification, CIS tax is always calculated correctly, and wages are always paid on time. Couldn’t recommend them highly enough.”
J&J Windows & Doors
“I couldn’t recommend EEBS enough! They are really informative, helpful and understanding. The whole team go above and beyond and they are really approachable and friendly too.”
Katy Jupp-Flower, Trustpilot Review
“I have worked with EEBS for over 3 years now and I cannot recommend them highly enough. Great people, great service, and they really know their stuff when it comes to contractor payroll.”
Stuart Hilton, Trustpilot Review
“Working with EEBS has been an absolute pleasure. Their team is friendly, approachable, and professional, with an exceptional understanding of CIS payroll. Their quick responses to queries and personalised service make the entire process smooth. Outstanding service backed by lovely, highly knowledgeable people.”
Will Nixon, Trustpilot Review
“The company I work for has traded with EEBS for over a decade. All personnel at EEBS are very polite, knowledgeable and very helpful. Great people to deal with who resolve any queries promptly and efficiently. I would recommend them to anybody.”
Maria Torrisi, Trustpilot Review
“Would highly recommend EEBS, we have used a few payroll companies in the past but by far these guys are the best. Always so helpful and very knowledgeable, such a great company to work with.”
Google Review
