Does an Apprentice Pay Tax and National Insurance?

Apprenticeships can be a great way to continue learning and strengthen your career prospects without actually staying in school or going on to other forms of education, such as university. Apprenticeships also give you a chance to combine this learning with working. This is a great way to get hands on experience and earn at the same time.

While taking an Apprenticeship can be great for you, it can also be quite a big step. This is because while you are still in education, you are also working, possibly even full-time. Whether you are straight out of school, university or even another job, starting an Apprenticeship can cause all kinds of questions. Particularly, the tricky financial ones about tax and national insurance.

In short, an apprentice may have to pay tax and/or National Insurance depending on their age and how much they earn. Apprentices will have to pay Income Tax if they earn more than £12,570 per year. If an apprentice is under the age of 18, then they will not need to pay Council Tax. Apprentices will also not need to pay Council Tax if they’re not being paid more than £195 per week and if their Apprenticeships meets certain requirements. Apprentices will need to pay National Insurance if they are paid more than £190 per week and are over 16.

Continue reading for more information about the tricky financial questions you may have about Apprenticeships. If you take an Apprenticeship or are planning to then this article will be particularly useful to you.

Do Apprentices pay Tax?

When you first start your Apprenticeship, it can be difficult to get your head around a lot of new things. From the work-study-life balance that you have to try and achieve to the shock of working in a new position full-time. But the arguably most confusing part is trying to figure out how taxes and all that financial stuff works.

In the UK, there are several different kinds of tax that we may have to pay in daily life. This includes consumption tax (VAT) and duties on things, such as alcohol or tobacco. If you want to know more about these types of tax, check out this article by EconomicsHelp.org. It also includes Income Tax, Council Tax and National Insurance.

Do Apprentices pay Income Tax?

Income Tax is simply as the name suggests. It is a tax on most types of income. The main one of these is income made from employment, but you can also be taxed on profits made if you’re self-employed and on your pension. For more information about this, check out this governmental guide.

An apprentice is just like any other employed person. This means that whether or not an apprentice will pay Income Tax fully depends on how much they earn. If an apprentice earns more than £12,570 per year, then they will need to pay Income Tax. If they are earning less than this per year, then they will not need to pay Income Tax. For more information about taxation on apprentices, check out this article by UCAS.

Do Apprentices pay Council Tax?

Council Tax is slightly different to income tax. It is collected by your local council to be used in your local area and so its uses can seem a lot more visible. Especially as it is used towards everyday things, such as rubbish collection services and libraries. For more information about Council Tax, check out this article from MoneyHelper.org.uk.

Typically, you will have to start paying Council Tax at the age of 18. This bill is based on at least 2 adults living in one home. This means that if the apprentice is below the age of 18, then they will instantly be disregarded from having to pay Council Tax. On top of that, certain Apprenticeship schemes also make apprentices exempt from having to pay.

To be exempt from Council Tax as an apprentice, you will need a declaration from your employer saying that you aren’t being paid more than £195 per week. It also needs to say that your Apprenticeship training will lead to a qualification that is approved by either Ofqual or the Scottish Vocational Education Council (SVEC). For more information about who has to pay Council Tax, check out this governmental guide.

Do Apprentices pay National Insurance?

National Insurance is a tax on earnings (typically from employment or profit if you’re self-employed) that is paid by employees, employers and the self-employed. This tax can build your entitlement to some benefits, such as State Pension or Parental Leave, depending on if you’re employed or self-employed. For more information about what National Insurance is, check out this article from MoneyHelper.org.uk.

You will typically have to pay national insurance if you’re 16 or over and earning £190 per week or more or if you are self-employed and are making a profit of £6725 per year or more. You will also need to have a National Insurance number before you can start paying. If you would like to know more about National Insurance, check out this governmental guide.

In case you were wondering, a National Insurance number is a series of numbers and letters to make sure that your tax and National Insurance contributions are recorded to you alone. To learn more about this, look here at Gov.uk.

So, unless you are making less than this £190 per week, you will have to pay National Insurance as an apprentice. However, your employer may benefit if you are under the age of 25, earning less than £967 per week and are in a government approved Apprenticeship scheme. For more information about this, check out this governmental guide.

How much does an apprentice earn?

How much an apprentice will earn will depend on a range of factors. These include, the industry of the business, the region that they are in, the level of Apprenticeship, age and the business itself. For more on this, check out this article from UnionLearn.org.uk.

Apprentices are at least entitled to the National Minimum Wage, which is set out by the government and updated every year. If the apprentice is under the age of 19 or in their first year of the Apprenticeship, then they will only be entitled to get the apprentice rate. This is an hourly rate of £4.81 from April 2022. But if the apprentice is over 19 and in at least their second year of their Apprenticeship then they will be entitled to the wage rate in correspondence with their age. From April 2022, these hourly wage rates based on age are as follows:

For more information about this, check out this guide from the government. Also, if you want to learn more about how much you get paid for an apprenticeship check out this Think Student article.

Are apprentices paid for college days?

While an Apprenticeships can mimic traditional full-time work in many ways, it is still very different. Mainly because during an apprentice, you’re still combining work with study and training. This also means that when it comes down to getting paid, this also works in a different way to how it would in an ordinary full-time job.

In the UK, an apprentice must be paid for their normal working hours, training that’s a part of the Apprenticeship and study towards English or maths qualifications. The training will need to take up at least 20% of your normal working hours in total but this could be at any time frame, such as every week, every month, or another separate specific time. Also, the training and study for English and maths qualifications could be done at your workplace, at a college or training provider or online. For more information about what you get paid for as an apprentice, check out this governmental guide.

To sum this up, the answer is yes. You will get paid for college days as long as they’re a part of your Apprenticeship.