Apprentice Levy

[CoolCat]

So are umbrellas going to get stung by the apprenticeship tax on their payroll, and have to reduce pay to contractors as a result?

[LisaContractorUmbrella]

It's not scheduled to come in until 2017 and I think that big business will have persuaded HMG that it's a really stupid idea before then

[Waldorf]

Surely a levy would have to come from an umbrella's margin and not deducted from the employees pay? I am sure there is a law against this sort of practice.

[Fred Bloggs]

It's not scheduled to come in until 2017 and I think that big business will have persuaded HMG that it's a really stupid idea before then

Hmmm, not sure I agree, Lisa. In fact I don't know the details of this levy, but if a scheme is implemented properly, everyone can win.

For example, years ago, I was at ICI and for three years worked in the apprentice training school. I remember there being an apprentice levy. It encouraged ICI and other big co's in the area to take on apprentices on four year training schemes. I recall that ICI actually came out of the deal better off than if they didn't train apprentices and as a bonus, as many as 70 sixteen year old youths every year got taken on and trained in a trade as well as getting day release funded by the employer to study for qualifications. It worked very well and I am just one of the folk who benefited from it, I was an ICI apprentice from 1973-77.

[NotAllThere]

Surely a levy would have to come from an umbrella's margin and not deducted from the employees pay? I am sure there is a law against this sort of practice.

The levy will be treated exactly as employees NI contributions. It will be deducted from your fee before your pay is calculated. EENIC is not deducted from your pay, neither will the levy be.

You understand the difference between your fee (the contractual amount agreed by the agency to pay the brolly) and your pay?

[LisaContractorUmbrella]

Hmmm, not sure I agree, Lisa. In fact I don't know the details of this levy, but if a scheme is implemented properly, everyone can win.

For example, years ago, I was at ICI and for three years worked in the apprentice training school. I remember there being an apprentice levy. It encouraged ICI and other big co's in the area to take on apprentices on four year training schemes. I recall that ICI actually came out of the deal better off than if they didn't train apprentices and as a bonus, as many as 70 sixteen year old youths every year got taken on and trained in a trade as well as getting day release funded by the employer to study for qualifications. It worked very well and I am just one of the folk who benefited from it, I was an ICI apprentice from 1973-77.

Unfortunately there is little connection between an apprenticeship scheme and the 'levy' - this is essentially just a tax that will be imposed on businesses whose wage bill is more than £3 million a year. These businesses will be required to pay 1/2% of their payroll to the Government to help them fund the apprenticeship scheme.

[Fred Bloggs]

Unfortunately there is little connection between an apprenticeship scheme and the 'levy' - this is essentially just a tax that will be imposed on businesses whose wage bill is more than £3 million a year. These businesses will be required to pay 1/2% of their payroll to the Government to help them fund the apprenticeship scheme.

As I suspected then, it's really just another jobs tax. In which case, I agree with you.

[LisaContractorUmbrella]

As I suspected then, it's really just another jobs tax. In which case, I agree with you.

Yep, just another tax

[AtW]

Surely a levy would have to come from an umbrella's margin and not deducted from the employees pay? I am sure there is a law against this sort of practice.

Is there a law that prevents passing on Govt taxes to customers? Would be nice if that was true - fuel would suddenly become a lot cheaper...

Interesting how Cameron/Osborne promised that that would not increase NICs and their first action in new Govt 5 years ago was to stop employer NIC from going up, how quickly they forgot that...

[Waldorf]

Is there a law that prevents passing on Govt taxes to customers? Would be nice if that was true - fuel would suddenly become a lot cheaper...

I was referring to something to do with unauthorised deductions from an employees pay, similar to the restrictions on deductions for breakages, errors etc. I would have thought that a tax on the employer could not be passed onto the employee, however I am not an expert on this area.