Tax body fears that Apprenticeship Levy will disadvantage smaller businesses

THE Chartered Institute of Taxation (CIOT) has called on the Government to rethink its approach to legislating for the 'Apprenticeship Levy,' because of a worry that smaller businesses may lose out by being unable to make full use of their £15,000 levy allowance.

The levy allowance will be available for businesses to offset against the planned:- 'Apprenticeship Levy,' to be introduced from April 2017.

The 'Apprenticeship Levy' will be calculated as 0.5% of the pay bill, and where there is more than 1 employer in the business, their pay bills will be added together. But in these circumstances only 1 of the employers will be entitled to the levy allowance and any unused amount will not be able to be transferred to another employer in the business. 

This will not affect larger businesses where at least 1 employer has a pay bill of over £3 million, but it will impact on smaller businesses where the aggregate pay bill exceeds £3 million, but the pay bill of any 1 employer falls below that figure. As a result they may end up paying more 'Apprenticeship Levy' than they would have done had they employed all their people through 1 employing company.  Colin Ben Nathan, Chair of the CIOT Employment Taxes Sub committee, said:- "We believe that this situation is unfair and that the levy allowance should be available for offset against the combined pay bills of all employers where aggregation applies. We would therefore urge the Government to reconsider the approach on this point."

In its submission on the 'Apprenticeship Levy', the CIOT also said there is a risk of in year overpayments because the levy allowance is to be pro-rated and allocated every month during the Tax Year.  Colin Ben Nathan added:- "It seems to us that a better option would be to adopt the same approach as for the Employment Allowance3 and allow the levy allowance to be claimed in full, up front, so that the Apprenticeship Levy is only paid when the pay bill 1st exceeds £3 million. Administratively this would be much simpler for employers (and HMRC) as this would mean that there should be no in year overpayments to be recovered from HMRC."

Interestingly back in December 2015, the CBI chief warned that the Government's new apprenticeship levy will hit jobs.  But some have now said that this new Levy will drive up quality of apprenticeship schemes... What do you think about this?  Do you have any experience or views on this topic?  Please let us know via emailing our newsroom to:- News24@SouthportReporter.com.

Healthier choices at City's fitness centres

FIZZY drinks and sweets are to be swapped for fruit juice and raisins as Liverpool's Lifestyles centres introduce healthy vending machines. Lifestyles users will be encouraged to make healthy food choices at eleven centres as water, yoghurts, protein bars and fruit replace high fat products such as crisps and chocolate. 3 million visits are made to Lifestyles centres each year, with more than half a million items of food and drink purchased. With the majority of users being families and young children, the initiative aims to help people get in to the habit of making healthier choices and reduce their sugar intake. Children's drinks that can now be bought are in line with the healthy food and snacks policy employed in schools. The state of the art, touch screen machines will be supplied by Totally Delicious Ltd. and are currently being installed. The new agreement will also see a new café created at Lifestyles Aquatics Centre in Wavertree. Assistant Mayor and cabinet member responsible for Lifestyles, Councillor Wendy Simon, said:- "As a council we are committed to promoting good health and want to do as much as we can to make it as easy as possible to make the right choices when it comes to what they eat and drink. As we're proactively encouraging people to get more active, it makes perfect sense that the vending machines at our Lifestyles centres support our healthy ethos and offer tasty food, which supports a balanced diet or active lifestyle and is value for money. It's also great news that as part of the deal, the popular Aquatics Centre will have a new eating area which will seat more than 30 people and will be a welcome addition to the venue." A report on the new vending machines was considered by the Culture, Tourism and Events Select Committee, Tuesday, 8 March 2016.  The Lifetsyles Centres which will have a healthy vending machine are:- Alsop, Austin Rawlinson, Cardinal Heenan, Ellergreen, Everton Park, Garston, Millennium, Park Road, Peter Lloyd, and Wavertree Aquatics Centre and Liverpool Tennis Centre.