Key things providers need to know about apprenticeship unit funding in England (2026)

This month (March 2026), we see the publication of new draft apprenticeship unit funding rules for England. Designed to break programmes into smaller, more flexible components, the units promise thousands of new learning opportunities nationwide.

Managing and funding this bite-sized approach to upskilling employees might take some getting used to, but we have you covered. If you’re a provider using Onefile, you’re already equipped to manage apprenticeship units today.

With those funding rules scheduled to come into force in April, here’s the lowdown on what you need to know about them.

1. What apprenticeship units are

Apprenticeship units are short, flexible training programmes, typically one to 16 weeks with 30-140 delivery hours, designed to upskill employees in specific, critical skills. They draw on existing apprenticeship standards but are not full apprenticeships. Providers delivering them must follow the funding rules and hold a valid funding agreement.

2. Provider eligibility and responsibilities

Only those organisations listed on the APAR (main provider or employer-provider routes) and approved to deliver specific units may receive this funding. Providers:

• hold full responsibility for end-to-end training and assessment.
• must comply with the funding agreement, ILR requirements and employer agreements.
• must not sub-contract out any aspect of training delivery.

3. Initial assessment duties

Providers need to undertake and evidence an initial assessment covering:

1. learner eligibility
2. programme eligibility
3. learning support needs

This assessment must take place before accessing funding, and its outcome needs to be summarised in the training plan. Note that learning support requires learner consent before being shared with the employer.

4. Learner eligibility rules

A learner must:

• be 19+ at the start of the unit.
• meet residency criteria (see Annex A of main funding rules).
• be employed and able to complete the programme within the timeframe (e.g. visas or fixed term contracts must not expire mid-programme).
• spend at least 50% of working hours in England.
• not be funded from any other DfE source, student loans or the ASF (Adult Skills Fund) for overlapping learning.
• not be self-employed, a sole trader, on IR35 arrangements or a company director without a separate line manager.

Note, learners already undertaking an apprenticeship or another unit cannot be funded.

5. Programme eligibility

The learner must enrol on an approved apprenticeship unit published by Skills England.
RPL (recognition of prior learning) does not apply.

If the learner already has prior knowledge covering 50% or more of the unit’s content, they are not eligible for funding. Providers must evidence that prior learning is below this threshold.

6. Employment requirements

Learners must:

• have a contract of employment long enough to complete the unit.
• be included on the employer’s declared PAYE scheme.
• be paid at least the national minimum wage (non-apprentice rate).

There is no requirement to sign an apprenticeship agreement (because this is not a full apprenticeship), but a line manager must be identifiable.

7. Delivery hours

Delivery hours are central to funding:

• Must be tutor delivered, with tutor and learner together, virtually or in-person.
• Must take place in normal paid working hours.
• Must teach new knowledge and skills directly relevant to the unit.

Excluded activities include induction, enrolment, English/maths, revision, exams and any training outside paid hours unless compensated.

Providers must deliver at least the published minimum delivery hours and evidence both planned and actual delivery. Missed sessions must be replanned. Failure to meet 30% or 100% delivery thresholds risks recovery of funding.

8. Training plan

A compliant training plan must:

• be agreed and signed before training starts.
• include learner details, job role, working hours, unit details, delivery schedule, minimum delivery hours, employer confirmation of release time, assessment arrangements and complaints process.
• be updated only when planned end date changes or missed training significantly affects release time.

This document will be used to validate milestone payments and must be retained.

9. Assessment requirements

All units require a skills test, designed by the provider, that is:

• valid, transparent, reliable and refreshed regularly.
• aligned to the unit’s knowledge and skills.

After training, the employer, provider and learner must sign off confirming completion and competence. The ILR must record the successful outcome to trigger the second milestone payment.

10. What can and cannot be funded

Eligible costs

• Initial assessment and onboarding
• Tutor delivery costs
• Training materials
• Programme administration and governance
• Skills test design and delivery
• Overlapping content in a non-mandatory qualification

Ineligible costs

• Recruitment
• CPD
• Induction
• PPE
• Wages
• Travel
• Employer support time
• Costs beyond required content
• Capital items
• Incentives
• ENIC services, and
• any additional costs for non-mandatory qualifications (exam/registration fees)

11. Funding mechanism and payments

All units must be funded through the apprenticeship service.

Payments are made in two milestones:

Milestone 1: 30% of planned delivery completed
Milestone 2: 100% delivery + successful outcome

Funding routes:

• Non-levy employers: Government funds 100% up to the band.
• Levy employers: Use levy funds; if insufficient, government funds 95% (co-investment)
  

 Learners must not contribute financially under any circumstances. VAT rules apply as normal.  

12. Transfers of levy funds

Levy paying employers may transfer up to 50% of their levy to other employers. Transfers must cover 100% of eligible costs and must be arranged before the learner starts. Providers must ensure MFA (minimal financial assistance) declarations are completed where relevant.

13. Change of circumstances

Key rules:

• Withdrawals stop all further payments; providers must issue a training transcript.
• If employment ends, training must stop immediately; learner may continue only with a new employer who confirms the need.
• Unit duration can be extended by up to eight weeks (except parental leave cases).
• KIT (keeping in touch) and SPLIT (shared parental leave in touch) days allow limited training during maternity, adoption or shared parental leave. Only training delivered on those days counts toward delivery hours.
  

14. Evidence and ILR requirements

Providers must maintain a robust evidence pack, including ILR data, learner identity and eligibility, delivery records, training plan, assessment evidence, signatures, and declarations. Electronic signatures are accepted if secure and auditable.

We’re here for you

Apprenticeship units are another step towards a more flexible, responsive skills system. Providers who can adapt quickly will be best placed to deliver high quality learning opportunities while meeting regulatory expectations.

With Onefile, you are not just keeping up, you are already there. Book a discovery call today to see how Onefile can help you get to grips with apprenticeship units and their funding.