What is Apprenticeship Wage, apprentices must be paid at least the apprentice national minimum wage. Apprenticeships are government-funded work-based training programmes for people aged 16 and up. They combine on-the-job training and nationally recognised qualifications. Apprenticeships are offered at different levels, from intermediate to advanced to degree level, and can last up to a year but can take longer depending on the qualification.
There are various subjects to choose from, including sector-specific apprenticeships such as Dental or Childcare, as well as Customer Service and Business Administration.
Apprenticeships are a common career choice for teenagers, but they are open to people of all ages.
What is Apprenticeship Wage?
During their apprenticeships, apprentices must be paid at least the national minimum wage.
Apprentices under the age of 19 and those aged 19 and over who are in the first year of their apprenticeship will get a rate of £4.15 per hour (from 1 April 2020), with certain companies promising more. Individuals who do not fall under these ranges should get the minimum wage within their age bracket.
The mandatory minimum apprenticeship wage rate should be paid for time worked and time spent training both on and off the job. This requires time spent at college or with an off-site.
Unfortunately, some companies do not truly understand how minimum wage wages function, and as a result, some apprentices are not often paid what they are legally entitled to. If you think you are not adequately paid, speak with your boss or call the ACAS Pay and Work Rights Helpline.
Please bear in mind that the government increases the minimum wage amounts on 1 April of each year.
What are the apprenticeship rights?
Since the bulk of apprentices are employed, they receive the same rights as other employees, including the option to enrol in a career pension if they meet the criteria (auto-enrolment).
However, there are many things to bear in mind: an apprentice can work at least 30 hours per week. Except in cases where the individual’s circumstances or the unique existence of employment in a specific field make this impossible, an absolute minimum of 16 hours must be met. In such situations, the apprenticeship period should be prolonged.
Many of the Working Time Rules’ special provisions for young workers under the age of 18 may apply to apprentices, such as requiring that young employees do not work more than eight hours a day or 40 hours a week. If their shift is more than four and a half hours, they are typically entitled to at least 30 minutes of rest.
What are the tax implications?
Apprentices are generally believed to be excluded from paying income tax. This is not correct. Apprentices, like anyone else, are expected to pay income tax.
If you get less than £12,500 in the 2020/21 tax year, you pay tax, but you must contribute Nation Insurance payments. The amount of £12,500 is known as your allowance. Earnings above the personal allowance are taxed at the applicable income tax limit.
The Pay usually charges tax As You Earn (PAYE) scheme, which deducts it immediately from the pay package. As a consequence, you are not required to file a Self Assessment tax return.
Is there a set of guidelines regarding National Insurance?
If you get more than £183 a week in the 2020/21 tax year, you will also contribute Nation Insurance payments (NIC). You will be required to pay Class 1 NIC as an employee. They are charged at 12% of weekly earnings ranging from £183 to £962. Payments of more than £962 a week will be liable to an additional 2% NIC.
You will not have to compensate Tier 1 NIC if you paid more than the lower wage limit (£120 a week or £520 a month in 2020/21) yet less than the primary amount (£183 a week or £792 a month in 2020/21). Your NIC record, though, will be credited as though you had paid Class 1 NIC. These are alluded to as NIC credits. You could be liable for contributory benefits and the state pension as a part of these.
In terms of separate National Insurance rules for apprentices, you might have heard that since April 2016, the government has limited NIC for apprentices under 25. This is correct; nevertheless, it will only apply to apprentices under 25 and up to a certain sum of earnings. Employers would be able to train more apprentices and would do so at a lower cost.
Will apprentices be qualified for tax breaks or universal credit?
Apprenticeships and tax benefits may be complex to understand. In general, if you are single and have no children, you must meet the following requirements to be eligible for WTC:
At least 25 years old and working at least 30 hours a week in “remunerative” work, or at least 16 years old and working at least 16 hours per week regardless of whether you have a physical or mental disability that makes it difficult to do work, or at least 60 years old and working at least 16 hours per week
Work hours can vary whether you have children or are a part of a pair. Is it possible for me to apply for Working Tax Credits (WTC)? gives a comprehensive overview of the conditions
According to HMRC, the hours you spend as an apprentice count as “remunerative” work for WTC purposes if you do the following:
- You have an apprenticeship job contract
- You are engaged in a scheme (apprenticeship) where the salary is taxable and subject to payroll tax and National Insurance payments
When it comes to universal credit and apprenticeships, you will receive universal credit if you do a “recognised” apprenticeship. This means, according to the DWP’s rules, you must:
- Working for a recognised qualification with a reputable firm and receiving at least the national living wage for an apprentice
Besides, you must be able to provide the following:
- The name of your training company
- The title of the vocational qualification you pursue
There are no upper or lower caps to the number of hours you must participate to qualify for universal credit as an apprentice; nevertheless, you would be expected to provide “job-related duty” as part of your Claimant Obligation if your earnings do not reach a certain amount, recognised as your Conditionality Earnings Threshold (CET). As an apprentice, you are limited to working no more than 30 hours a week compounded by the applicable minimum wage scale. If you are sick, this amount can be reduced, or you may be exempt from CET entirely.
What is the care leaver apprenticeship bursary?
There is a £1,000 bursary (payment) for qualified apprentices who have fulfilled at least 60 days of their apprenticeship. The money is collected by the apprenticeship provider, who then distributes it to the apprentice with your apprenticeship wage. To put it another way, the apprentice is not authorised to apply.
To be qualified for the bursary, the apprentice must be in care or have left care in the United Kingdom after hitting the age of 16.
The apprentice must have begun their apprenticeship on or after 1 August 2018 and must not have already earned the care leavers’ bursary. The bursary is not taxable and is not subject to National Insurance contributions and does not affect the apprenticeship wage.