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Employers of young apprentices will no longer pay NICs

Employers of apprentices under the age of 25 will no longer have to pay National Insurance contributions.

Employer National Insurance contributions for young apprentices earning £16,000 have been abolished, which will save companies thousands of pounds.

The change came into effect on 6 April 2016, to encourage businesses to hire apprentices under the age of 25, helping young people learn skills on the job and creating better value for employers across the country.

The exemption will apply to both existing employers with apprentices and those taking on a new apprentice.

Skills Minister Nick Boles said: “We’re making it even better value for businesses to take on a young apprentice. Businesses will no longer need to pay National Insurance contributions for apprentices under 25.

“Apprenticeships make sense for young people and for business. If you’re an employer not already reaping the benefits, now is the time to act.”

This comes as part of the government’s plans to reform apprenticeships, to ensure that they are high quality and responsive to the needs of employers. As part of the new Trailblazer initiative, employers will have the power to design and deliver new apprenticeships, with more than 1,300 employers currently designing apprenticeships covering a wide range of jobs.

A £10M fund has been introduced, which gives apprentices the opportunity to gain a degree whilst learning on the job.

In addition, the Institute of Apprenticeships has been created. The new independent body will be in place by 2017, and  is led by employers who will work to ensure that there is a high level of apprenticeships in England.

National Apprenticeship Week took place from the 14-18 March 2016, with hundreds of events being held across the country and more than 30,000 new apprenticeship places pledged by employers.