employee go to GOV.UK.
Some things to note though are:
- The minimum hours of employment for an apprentice should be at least 30 hours per week. By exception, where the individual’s circumstances or the particular nature of employment in a given sector makes this impossible, then an absolute minimum of 16 hours must be met. In such cases the duration of the apprenticeship should be extended.
- Apprentices are also entitled to holidays which you can find out more about on GOV.UK.
- Many of the special protections in the Working Time regulations for young workers under 18 will apply to apprentices, for example young workers must not exceed the eight hours a day or 40 hours per week. They are also entitled to rest breaks of at least 30 minutes if their shift lasts more than four and half hours.
You can contact the ACAS Pay and Work Rights Helpline for free and confidential advice on your rights at work.
What are the tax implications?
There is a common misconception that apprentices do not have to pay tax. This is not the case. Apprentices have to pay income tax in the same way as everyone else. Some general tax guidance for first time workers, which apprentices may find useful, can be found in our employment section.
For the 2020/21 tax year, if you earn less than £12,500 you should not ultimately be taxed at all, but you may pay National Insurance contributions (see below). The £12,500 figure is known as your personal allowance. Earnings over the personal allowance will be taxed at the appropriate income tax rate.
You will normally pay tax through the Pay As You Earn (PAYE) system – meaning that it is taken straight from your pay packet. You will therefore not normally need to worry about completing a Self Assessment tax return.
You can find out more about tax rates and allowances, how the PAYE system for employees works, how tax is paid and how to claim back tax if you think you have paid too much, in the tax basics section.
Are there special rules for National Insurance?
For the 2020/21 tax year, if you earn more than £183 per week you will also have to pay National Insurance contributions (NIC). As an employee you will pay Class 1 NIC. These are charged at 12 per cent of your income between £183 and £962 per week. Earnings over £962 per week will attract additional NIC at 2 per cent.
If you have earnings above the lower earnings limit (£120 per week or £520 per month for 2020/21/20) and below the primary threshold (£183 per week or £792 per month for 2020/21) you will not have to pay any Class 1 NIC. Your NIC record will be credited, however, as though you have paid Class 1 NIC. These are called NIC credits. These may earn you entitlement to contributory benefits and the state pension.
You can find out more about this in the NIC guidance in our employment section.
With regards to special rules about National Insurance for apprentices, you may have heard that the government cut NIC for apprentices aged under 25, since April 2016. This is true, however this will only apply to employer NIC for apprentices aged under 25 and up to earnings of a certain level. This will make it cheaper for employers to take on an apprentice – hopefully meaning they will take on more. You can read more about it in this government notice.
Can apprentices claim tax credits or universal credit?
There are two types of tax credit – working tax credit (WTC) and child tax credit (CTC).
The tax credits system is gradually being replaced by universal credit (UC). UC should have finished rolling out for new claims by January 2019. Existing tax credit claimants will be transferred across to UC sometime between July 2019 and March 2023 unless they have a change of circumstances that means they need to claim UC earlier or they choose to claim UC.
Apprenticeships and tax credits can be a tricky subject. As a general overview, if you are single and have no children, then to be entitled to WTC, you will need to be:
- at least 25 years old and in ‘remunerative’ work for at least 30 hours per week; or
- at least 16 years old and working at least 16 hours per we