Employers of apprentices under 25 years of age will no longer pay National Insurance contributions and are set to save thousands of pounds.
The abolishment which came into effect on 6 April 2016, applies to both existing employers with apprentices and those taking on a new apprentice. According to the Government, employers look to save around £1,000 a year when employing an apprentice earning £16,000.
Commenting on the change, skills minister Nick Boles said:
“We’re making it even better value for businesses to take on a young apprentice. Businesses will no longer need to pay National Insurance contributions for apprentices under 25.
“Apprenticeships make sense for young people and for business. If you’re an employer not already reaping the benefits, now is the time to act.”
The government is committed to reforming apprenticeships to ensure they are high quality and responsive to the needs of employers by:
- giving employers the power to design and deliver new apprenticeships as part of the new Trailblazer initiative. There are now more than 1,300 employers designing apprenticeships in a broad range of jobs
- introducing a new £10 million fund to boost the number of degree apprenticeships available, providing more opportunities for young people to get a degree while working at a top company
- creating the Institute for Apprenticeships by April 2017 – a new independent body, led by employers that will ensure the quality of apprenticeships in England
National Apprenticeship Week 2016 took place from 14 to 18 March 2016 and saw over 30,000 new apprenticeship places pledged by employers, including Serco who has pledged 1,000 apprentices by the end of the year and Compass Group UK & Ireland who has announced plans to increase the number of its apprentices to 1,500 by the end of 2017.