Employers in England recruiting young apprentices can access government support to reduce the cost of training and developing new staff. Under the apprenticeship funding rules applying to new starts from 1 August 2026, eligible apprentices aged 16 to 24 can have 100% of their apprenticeship training and assessment costs funded by the government, up to the funding band maximum. A separate hiring payment of £2,000 is also being introduced for eligible non-levy-paying employers recruiting new apprentices aged 16 to 24 from 1 October 2026.
These arrangements can help small businesses, growing employers and organisations planning entry-level recruitment. However, training funding and employer hiring payments are separate forms of support, with different eligibility conditions. This guide explains how the arrangements work, who can qualify and how employers can prepare.
Key apprenticeship funding facts for 2026
- Training support: Up to 100% of eligible training and assessment costs for qualifying apprentices aged 16 to 24.
- Age at start: The apprentice must meet the age conditions when apprenticeship training begins.
- Hiring payment: Eligible non-levy employers can receive £2,000 for qualifying new employees aged 16 to 24 under the new payment arrangements.
- Start date: The revised training funding rules apply to apprenticeship starts from 1 August 2026. The new hiring payment applies to qualifying recruitment from 1 October 2026.
- Geographical scope: The funding rules described in this article apply to England, not automatically to Scotland, Wales or Northern Ireland.
1. What is free apprenticeship training for under-25s?
An apprenticeship combines paid employment with structured training. Apprentices develop practical skills while working towards an approved apprenticeship standard relevant to their job role.
For eligible apprenticeship starts from 1 August 2026, the government can fund the full eligible cost of training and assessment for apprentices aged 16 to 24 at the start of training. The rules also cover certain 15-year-olds whose 16th birthday falls between the last Friday of June and 31 August, as specified in the official funding guidance.
The funding is subject to the maximum funding band assigned to the apprenticeship standard. If the agreed training and assessment price exceeds that maximum, the employer may need to cover the difference. Therefore, 100% government funding does not mean that every cost connected with employing an apprentice is free.
The training funding is available to eligible employers whether or not they pay the apprenticeship levy, subject to the applicable rules. The exact funding route depends on the employer funding position and the apprentice start date.
Official guidance: Apprenticeship funding policy for 2026 to 2027.
2. Who can qualify for government-funded training?
Employers should confirm the eligibility of the apprentice and the apprenticeship programme before arranging training. The principal age-related conditions for the funding changes are summarised below.
| Condition | What employers should know |
|---|---|
| Age | Generally 16 to 24 at the start of apprenticeship training, with a specific qualifying exception for certain 15-year-olds. |
| Location | The funding policy covered here applies to eligible apprenticeship training in England. |
| Programme | The apprenticeship must meet the relevant funding rules and use an eligible apprenticeship standard. |
| Training provider | The employer must arrange eligible training and assessment through an appropriate provider. |
| Funding limit | Government support is capped at the funding band maximum for the relevant apprenticeship standard. |
| Employment | The apprentice must have an eligible employment arrangement and meet the programme requirements. |
Age alone does not guarantee funding. Employers and providers must also follow the current apprenticeship funding rules, confirm eligibility and maintain the required records.
3. How the funding differs for levy and non-levy employers
The apprenticeship levy is a payroll-based contribution that applies to employers meeting the relevant levy requirements. Employers that do not pay the levy normally access government support through the apprenticeship service and the applicable co-investment arrangements.
| Employer situation | Eligible apprentice aged 16 to 24 | Apprentice aged 25 or over |
|---|---|---|
| Employer does not pay the levy | Government funds 100% of eligible training and assessment costs up to the funding band maximum. | Government generally funds 95% up to the funding band maximum, with the employer paying the remaining 5%. |
| Levy-paying employer with sufficient available funds | Eligible training can be funded through the apprenticeship service account under the applicable rules. | Available levy funds can be used under the applicable funding rules. |
| Levy-paying employer that has exhausted available funds | Government funds 100% of eligible training and assessment costs up to the funding band maximum for qualifying apprentices aged 16 to 24. | Government generally funds 75% up to the funding band maximum, with the employer paying the remaining 25%. |
The table summarises the key arrangements for eligible starts from 1 August 2026. Funding availability, account balances, programme eligibility and the full rules must still be checked. Employers should not assume that every apprentice or every training expense qualifies automatically.
Official information: Get funding for apprenticeship training.
4. The new £2,000 apprenticeship hiring payment
From 1 October 2026, eligible employers that do not pay the apprenticeship levy can access a £2,000 hiring payment when recruiting qualifying new apprentices aged 16 to 24. This is separate from the funding that pays for training and assessment.
The published government information describes the payment as being made in two instalments. The first is due at day 90 and the second at day 365, or day 242 if the apprenticeship lasts less than 12 months. The earliest payments are expected from January 2027, subject to the payment process and eligibility requirements.
How the £2,000 payment is scheduled
- First instalment: £1,000 at day 90, subject to eligibility.
- Second instalment: £1,000 at day 365, or day 242 for an apprenticeship lasting less than 12 months, subject to the applicable rules.
- Payment route: The training provider claims the payment and passes it to the eligible employer.
- Employment condition: The apprentice must remain employed when the relevant payment is due.
The payment is intended to help employers with costs associated with hiring and supporting a new apprentice. Employers should check the current funding guidance for the detailed eligibility criteria, required evidence and claim process before budgeting for the payment.
Official information: Explore apprenticeship funding options for employers.
5. Other financial support employers may be able to combine
Depending on the apprentice and the employment circumstances, employers may qualify for additional support. These payments have their own conditions and should not be treated as automatic.
| Support | Potential eligibility | Important detail |
|---|---|---|
| £1,000 employer payment | Apprentices aged 16 to 18, or eligible apprentices under 25 who are or have been in care, or have an education, health and care plan. | Eligibility and the payment process must be confirmed under current rules. |
| £2,000 foundation apprenticeship payment | Eligible foundation apprentices aged 16 to 21, with specified extensions for some apprentices under 25. | Paid in instalments through the training provider under the relevant rules. |
| £3,000 Youth Jobs Grant | Eligible apprentices aged 18 to 24 who have been unemployed and claiming Universal Credit for six months or more. | Paid in two instalments through the Department for Work and Pensions, subject to programme conditions. |
| Employer National Insurance relief | Eligible apprentices under 25 who meet the relevant payroll and earnings conditions. | Check the current HMRC rules before calculating payroll savings. |
Some support payments may be combined for the same apprentice when the relevant rules permit it. Employers should confirm which schemes apply to their circumstances rather than simply adding every advertised payment together.
Official guidance: Incentive payments for hiring a new apprentice.
6. What costs are covered and what may remain payable?
Government funding is intended to cover eligible apprenticeship training and assessment within the funding band maximum. Employers should distinguish these costs from the wider costs of recruiting and employing a young person.
Costs that may be covered
- Eligible apprenticeship training delivered by an approved training provider.
- Eligible assessment costs included within the funding arrangements.
- Qualifying support payments where the employer and apprentice meet the relevant conditions.
Costs employers should budget for separately
- Apprentice wages and associated employment costs.
- Training or assessment charges above the applicable funding band maximum.
- Equipment, uniforms, travel or other employment expenses not covered by the training funding.
- Workplace supervision, onboarding and time spent supporting the apprentice.
Apprentices are employees and must receive the applicable legal employment rights and pay. Employers should check the current minimum wage rules and apprenticeship wage requirements before making a job offer.
Official guidance: Apprentice pay and conditions.
7. How employers can access apprenticeship funding
Employers should plan recruitment and training together. The following steps provide a practical starting point for businesses considering an apprentice in England.
- Identify the job role. Decide which skills the business needs and whether an approved apprenticeship standard matches the role.
- Check the apprentice eligibility. Confirm age, employment arrangements and other relevant conditions before training begins.
- Find a suitable training provider. Discuss delivery, assessment, duration, the training price and the apprenticeship funding band.
- Check the funding route. Establish whether the business pays the levy, whether levy funds are available and which government contribution applies.
- Use the apprenticeship service. Complete the relevant employer account and funding arrangements. Non-levy employers may need to reserve funding unless they are receiving a qualifying levy transfer.
- Agree the training arrangements. Confirm the apprenticeship agreement, training plan and responsibilities with the provider and apprentice.
- Check additional payments. Ask the provider about the new £2,000 hiring payment and any other incentive for which the business may qualify.
- Keep records and monitor progress. Retain the required documentation and ensure the apprentice remains eligible for any payments when instalments become due.
Employers can start with the official government apprenticeship funding guidance and the Apprenticeships employer service.
8. Example: How training funding could work for a small business
Imagine a small business in England recruits an eligible 20-year-old apprentice. The agreed eligible training and assessment price is £8,000, and the funding band maximum is at least £8,000.
| Eligible training and assessment price | £8,000 |
| Potential government training funding | £8,000 |
| Employer contribution towards this eligible training price | £0 |
This illustration assumes the apprentice and programme meet all funding conditions and the full price falls within the funding band maximum. It does not include wages, workplace costs or any charges above the maximum.
If the employer also qualifies for the separate £2,000 hiring payment for a new apprentice recruited from 1 October 2026, that support may reduce other eligible employment-related costs. The hiring payment is not an automatic part of the £8,000 training calculation and must be assessed separately.
9. Important dates for employers in 2026 and 2027
| Date | What it means |
|---|---|
| 1 August 2026 | The 2026 to 2027 apprenticeship funding rules apply to apprenticeship starts within the relevant funding year. |
| 1 October 2026 | The new £2,000 hiring payment begins for eligible non-levy employers recruiting qualifying new apprentices aged 16 to 24. |
| January 2027 | Earliest payments under the new hiring payment arrangements are expected, subject to the relevant process and eligibility. |
| 31 July 2027 | The 2026 to 2027 apprenticeship funding year ends. The rules for an individual apprenticeship depend on its start date and the applicable provisions. |
Employers should use the latest official guidance before signing training agreements or forecasting incentive payments. Government funding rules can be updated, and individual circumstances may affect eligibility.
10. Frequently asked questions
Is apprenticeship training free for everyone under 25 in the UK?
No. The 100% government funding arrangement described here applies to eligible apprenticeship training in England for qualifying apprentices aged 16 to 24 at the start of training, subject to the funding band maximum and other rules. Different arrangements apply in Scotland, Wales and Northern Ireland.
Can an employer receive £2,000 for hiring an apprentice under 25?
An eligible employer that does not pay the apprenticeship levy may qualify for the £2,000 hiring payment when recruiting a qualifying new apprentice aged 16 to 24 from 1 October 2026. The employer must meet the detailed conditions and payment requirements.
Does the government pay the apprentice salary?
No. Training funding covers eligible training and assessment costs within the applicable limits. Employers remain responsible for wages and other employment obligations.
Can levy-paying employers receive full training funding for under-25 apprentices?
Eligible apprentices aged 16 to 24 can receive 100% funding for eligible training and assessment costs up to the funding band maximum when the relevant rules are met. Levy funds and account arrangements affect how the funding is administered.
When will the new £2,000 hiring payment be paid?
The published arrangements provide for two instalments of £1,000. The first is scheduled for day 90 and the second for day 365, or day 242 if the apprenticeship lasts less than 12 months. The earliest payments are expected from January 2027, subject to eligibility and the payment process.
Can an employer receive other apprenticeship incentives as well?
Potentially. Eligible employers may qualify for additional payments, including support for certain younger apprentices, foundation apprenticeships or eligible young people who have been unemployed and claiming Universal Credit for six months or more. Each scheme has its own conditions, so employers should check whether payments can be combined.
Where can a business check official eligibility?
Start with the government guidance on apprenticeship training funding and the employer funding options. Employers can also ask their training provider to confirm the applicable funding rules and incentive claim process.
Conclusion
The apprenticeship funding changes for 2026 offer eligible employers in England a way to reduce training costs when recruiting young people. Qualifying apprentices aged 16 to 24 can receive 100% government funding for eligible training and assessment up to the funding band maximum, while eligible non-levy employers recruiting new apprentices from 1 October 2026 may also qualify for the separate £2,000 hiring payment.
Before recruiting, businesses should confirm the apprentice age and employment conditions, choose an eligible apprenticeship standard, agree the training price with a provider and verify all available support through official government guidance. Careful checks can help employers plan realistic recruitment budgets and avoid relying on payments for which they do not qualify.
Official sources and further information
- Apprenticeship funding policy for 2026 to 2027
- Apprenticeship funding rules: 2026 to 2027
- Get funding for apprenticeship training
- Apprenticeships employer funding options
- Incentive payments for hiring a new apprentice
This article is for general information. Eligibility and payment conditions depend on the official rules in force for the relevant apprenticeship and start date. Check the latest government guidance before making financial or recruitment decisions.
