Apprenticeship Funding Changes 2026: Devon Employer Guide

Apprenticeship funding changed on 1 August 2026. Here is where you stand.

Everything a Devon, Plymouth or Torbay employer needs to know, checked against GOV.UK and updated when the rules move.

Last updated 24 August 2026

What government pays towards training and assessment, for apprenticeships starting from 1 August 2026

Your situation	Apprentice aged 16 to 24	Apprentice aged 25 or over
You do not pay the apprenticeship levy	Government pays 100%. You pay nothing towards training.	Government pays 95%. You pay 5%.
You pay the levy and have funds available	Paid from your levy account	Paid from your levy account
You pay the levy and your funds have run out	Government pays 100%. You pay nothing towards training.	Government pays 75%. You pay 25%.
Your apprentice started on or before 31 July 2026	Unchanged. Old rules apply.	Unchanged. Old rules apply.

All figures are up to the funding band maximum for the standard. Bands run from £1,500 to £27,000. Anything agreed above the band maximum is paid by the employer.

If you have been told co-investment went from 5% to 25%, that is only half of it. The 25% rate applies to apprentices aged 25 and over. For apprentices aged 16 to 24, the government now funds the full cost whether or not you pay the levy. This was confirmed in a July 2026 announcement and a lot of published guidance has not caught up.

From 1 October 2026, employers who do not pay the levy can claim up to £2,000 for each new apprentice aged 16 to 24.

To qualify, all of the following must be true:

The apprenticeship practical period starts on or after 1 October 2026
The apprentice is aged 16 to 24 at the start of training
The apprentice is on the PAYE scheme linked to your apprenticeship service account
The apprentice has not been employed by you for more than 90 days before the practical period start date

Ellie, 19, joins a Plymouth engineering firm on 1 September 2026. Her apprenticeship starts on 1 October. She has been employed for 30 days. The employer claims £2,000.

Marcus, 19, joins a Torbay care provider on 1 June 2026. His apprenticeship starts on 1 October. He has been employed 122 days. The employer claims nothing.

If you have hired someone young in the last three months and have not yet started their apprenticeship, this is time critical.

Everything else you can claim

Payment	Amount	Who gets it	Who it is for
Hiring payment	Up to £2,000	Employer	Non-levy employers, apprentice aged 16 to 24, practical period starting from 1 Oct 2026
Young apprentice payment	£1,000	Employer	Apprentice aged 16 to 18, or 19 to 24 with an EHCP or care experience
Foundation apprenticeship incentive	Up to £2,000	Employer	Employers taking on an eligible foundation apprentice
Universal Credit hiring incentive	£3,000	Employer	Apprentice aged 18 to 24 who has claimed Universal Credit for over six months
Care leaver bursary	£3,000	The apprentice	Apprentices aged 16 to 24 who are or have been in local authority care

These stack. An SME hiring an 18 year old who has been on Universal Credit for six months could see £2,000, £1,000 and £3,000 alongside fully funded training. Eligibility conditions apply to each and are set out in the apprenticeship funding rules.

If you pay the levy, three things changed

The automatic 10% government top up on your levy funds has been removed.
New funds entering your account from August 2026 expire after 12 months, not 24. Funds already in your account before August keep the 24 month expiry. Oldest funds are spent first.
You can still transfer up to 50% of your annual funds to any number of other employers. In a 12 month expiry world this matters more than it did. If you are not going to spend it, transfer it to a supplier, a customer or a local business rather than lose it.

Want to transfer unused levy funds to a Devon business? Tell us and we will match you.

The numbers

0 %

of apprenticeship starts in England went to under 19s between August 2025 and January 2026. The lowest share in five years.

110100

apprenticeship starts with employers who do not pay the levy in 2024/25, down from 189,720 in 2017/18.

353450

apprenticeship starts in England in 2024/25, up 4.1%.

apprenticeship starts across Plymouth, Devon and Torbay.

The changes from August and October 2026 exist because young people’s share of apprenticeships has been falling for years. The money has been redirected at exactly the group most small Devon employers hire.

Resources and links

Official guidance

Apprenticeship funding, GOV.UK. The source for everything on this page.
Apprenticeship funding rules 2026 to 2027, GOV.UK. The detailed rules, including eligibility conditions for each payment.
Cost Stack Calculator. Use the British Chambers of Commerce’s calculator to see how your business compares and submit your figures anonymously to help demonstrate the true scale of cost pressures facing British businesses.
Find an apprenticeship, GOV.UK. Where to advertise your vacancy, free.
Employing an apprentice, GOV.UK. Set up your apprenticeship service account.
Apprenticeship standards, Institute for Apprenticeships. Search by occupation to find the standard and its funding band.
Apprenticeship provider and assessment register, GOV.UK. Check a provider is approved before you commit.
Transfer your levy funds, GOV.UK.

Local support

Greater Devon LSIP. The plan, the priority sectors and the delivery programme.
South West Apprenticeship Ambassador Network. Talk to an employer who has done it.
Devon Chamber of Commerce membership and business support.
Skills Launchpad Plymouth. Connecting local businesses and people with opportunities for skills, training, education, careers and jobs.
Devon and Torbay Combined County Authority. Working to secure new investment to help create additional high-value jobs.
Jobcentre Plus. Find your next job.

Downloads

One page funding summary, PDF, updated [date] ASK ME OR PB ABOUT THIS ONE
The 90 day rule explained, PDF ASK ME OR PB ABOUT THIS ONE

Get face to face help

Devon Business Show, Wednesday 14 October 2026, Plymouth Life Centre, 10am to 3pm. Free to attend.
Devon Chamber, the Greater Devon LSIP, SWAAN and the DWP will be on stand 65. Bring your situation and we will tell you where you stand.

Ask us a question

This page summarises published government guidance and is not a substitute for it. Eligibility conditions apply to every payment listed. Check the apprenticeship funding rules or talk to us before you commit.