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Apprenticeship Levy

DavidbyworthDavidbyworth Registered Posts: 67
in General accounting discussion
Hi

Bit of a mental block at this end. What will the double entry be for an apprenticeship levy. The liability will sit on the accounts until paid later that month.
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  • readerreader Experienced Mentor MAAT, AAT Licensed Accountant Posts: 1,038
    Apprentice levy is effectively another type of employer's national insurance.

    However rather than the rate being 13.8% it is only 0.5%.

    So the double entry would be:
    DR Apprentice levy expense (this would be an expense account in the P&L just under employer's NI)
    CR PAYE
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  • DavidbyworthDavidbyworth Registered Posts: 67
    Thanks that is a great help. And then this will clear under the PAYE payment through bank?
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  • readerreader Experienced Mentor MAAT, AAT Licensed Accountant Posts: 1,038
    Davidbyworth said:

    Thanks that is a great help. And then this will clear under the PAYE payment through bank?

    Yes, the PAYE balance will clear to £nil when it is paid off by the 22nd of the following month.

    The payroll you are dealing with must to huge because the apprentice levy only kicks in when the wage bill is £3M+ per year
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