During their apprenticeships, apprentices must be paid at least the national minimum wage, so yes, you do get paid for an apprenticeship.
Apprentices under the age of 19 and those aged 19 and over who are in the first year of their apprenticeship may be paid a rate of £4.30 per hour (from 1 April 2021) for certain companies offering more. Individuals who do not fall under any of these categories should be paid the minimum wage within their age bracket. GOV.UK provides information on the appropriate hourly rates.
Note: according to the rules, any new rate (for those turning 19 and completing their second year of apprenticeship) starts at the start of the next pay period. People naturally assume that whilst being paid monthly and hit the age of 19 (say) on the 15th of the month, they should be paid at the higher rate for the rest of the month. They are, though, only entitled to it as of the first of the month after their birthday.
The mandatory minimum wage rate should be paid for time working and time spent training both on and off the job. This includes time spent at college or with an off-site training provider, making sure you get paid for an apprenticeship.
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 terms and conditions?
Since the bulk of apprentices are employed, they receive the same rights as other employees, including the option to enrol in a pension if they meet the criteria (auto-enrolment).
However, their things to remember:
- An apprentice can work at least 30 hours a week. Even in situations where the individual’s circumstances or the existence of the job in a particular field make this impossible, an absolute minimum of 16 hours must be met. In such situations, the apprenticeship period should be prolonged.
- Apprentices are often entitled to paid holidays
- Many of the Working Time Rules’ extra provisions for young workers under the age of 18 may apply to apprentices, such as young employees won’t 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 usually entitled to at least 30 minutes of rest.
What are the tax implications?
Apprentices, it is commonly believed, are not required to pay income tax. I’m afraid that’s not right. Apprentices, like anyone else, are expected to pay income tax but at least you get paid for an apprenticeship.
If you earn less than £12,570 in the 2021/22 tax year, you will not be charged at all, but you must pay National Insurance contributions. The sum of £12,570 is considered your salary. Earnings above the personal allowance are taxed at the applicable income tax limit.
The Pay usually charges tax As You Earn (PAYE) programme, which deducts tax immediately from the pay package. As a consequence, you don’t have to file a Self Assessment tax return.
Is there a set of guidelines regarding National Insurance?
If you earn more than £184 a week in the fiscal year 2021/22, you will also pay National Insurance contributions (NIC). You will be expected to pay Class 1 NIC as an employee. They are charged at 12% of weekly wages ranging from £184 to £967. Earnings of greater than £967 a week will be exposed to an additional 2% NIC.
If your salary exceeds the lower earnings limit (£120 a week or £520 per month for 2021/22) but falls below the critical rate (£184 per week or £797 per month for 2021/22), you would not be forced to pay Class 1 NIC. Your NIC record, though, will be credited as though you had paid Class 1 NIC. These are referred to as NIC credits. You could be eligible for contributory benefits and the state pension as a result 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 right, but it only applies 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?
Work credits are classified into two types: working tax credits (WTC) and child tax credits (CTC) (CTC).
The tax benefit system would be phased down in favour of universal credit in the long run (UC).
Universal credit is now mandatory in the United Kingdom. Still, specific households may no longer be able to apply for tax credits and now be allowed to assert UC (or pension credit). Around November 2020 and September 2024, existing tax credit applications will be moved to UC. More details on this can be found in our segment on universal credit.
Apprenticeships and tax benefits may be complex to understand. To be considered for WTC, you must fulfil the following conditions if you are single and do not have children:
- At least 25 years old and working at least 30 hours a week
- Or at least 16 years old and working a minimum of 16 hours per week regardless of whether you have a physical or mental disability that renders finding work difficult
- Or at least 60 years old and working a minimum of 16 hours per week
Work hours can vary whether you have children or are a part of a pair. Can I apply for Working Tax Credits?
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 and receiving at least the NMW for an apprentice
Also, you must be able to provide the following:
- The name of your educational company
- The title of the vocational qualification you are seeking
There are no upper or lower limits to the number of hours you must participate in qualifying for universal credit as an apprentice; nevertheless, you would be expected to do “job-related duty” as part of your Claimant Commitment if your earnings do not meet a certain level, known 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 ill, this number can be diminished, or you may be exempt from CET entirely. You can discuss this with your job coach and decide about it as part of your universal credit Claimant Commitment.
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. In other words, the apprentice is under no obligation to apply.
The apprentice may remain in care or have quit care in the UK before the age of 16 to be qualified for the bursary.
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.
In conclusion, we hope you now understand, you get paid for an apprenticeship.