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Split the apprenticeship levy across multiple companies

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Summary

How to split the apprenticeship levy across multiple companies in Sage 50 Payroll.

Description

If you're part of a group of connected companies, with separate data for each company, you can split the apprenticeship levy across them.

To split the apprenticeship levy allowance, use the Split Apprenticeship Levy with another company option.

Resolution

The Apprenticeship Levy threshold and allowance for a company is £3,000,000 and £15,000 respectively.

If you have multiple companies within a group, you can split the threshold and allowance across the companies in the group.

Ensure that between your companies, the total annual threshold is still £3,000,000, and the total annual allowance is £15,000. ▼ Click here to view an example.

For example, you need to split the allowance and threshold equally between two companies in a group.

In each company, set the annual threshold to £1,500,000.00, and set the annual allowance to £7,500.00.

Add the split in your settings

Use the Split Apprenticeship Levy option in the steps below to configure your split in each affected company.

Once you enter the split, your software uses these values to calculate the apprenticeship levy liability for the tax year in this company.

To update your Apprenticeship Levy settings:

  1. Click Payroll then Change Process Date.
  2. Enter the first date in the tax year you'd like to set up, then click OK.
  3. Click Company then click Legislation.
  4. Click the NI tab.
  5. Click Edit next to Apprenticeship Levy Settings.
  6. In the Company Settings section:
    • Select the Split Apprenticeship Levy with another company checkbox
    • Enter the required values in This Company's Allowance and This Company's Threshold

      NOTE:

      Don't enter your split in the Annual Allowance or Annual Threshold fields in this window, as software updates reset these values. Your software retains the Company Settings you enter even after a software update.

  7. Select OK, then OK.

You've now split the Apprenticeship Levy for this company. Log in to any other company involved in the split and repeat the steps above.

HMRC submission

In line with HMRC requirements, Sage 50 Payroll doesn't include Apprenticeship Levy values in the Full Payment Submission.

If you have Apprenticeship Levy liability in any pay periods, submit an Employer Payment Summary (EPS) for each period.

Important information

When you complete the EPS wizard, the wizard includes your Apprenticeship Levy liability, and Apprenticeship Levy Allowance value.

If the Apprenticeship Levy Allowance value here defaults to £15,000, you don't need to amend it to the split value for this company.

This is because your software already calculates the correct liability based on the split you enter, and the EPS includes this.

Amending the Apprenticeship Levy Allowance in the EPS doesn't change the liability that HMRC expect.

Split changed during the tax year

If you change the split in a company during the tax year, recalculate each period by running the P32 again from month one:

  1. Check that your Process Date is within the tax year you need to recalculate.
  2. Re-run the P32, one month at a time starting from month one.
  3. Your new P32s include the correct AL liability for each month.
  4. Let HMRC know about any changes by submitting an EPS to adjust your payment to HMRC.