The number of investigations launched by HM Revenue & Customs into the underpayment of the Apprenticeship Levy has more than doubled in a year.
According to data obtained from a Freedom of Information request by accountancy group UHY Hacker Young, underpayments increased to 84 in 2018-19, from 33 in 2017/18. HMRC has collected an additional £6.2m through these investigations in the last year, up from £5.2m in the previous year.
UHY Hacker Young partner Clive Gawthorpe said: “The fiendishly complex Apprenticeship Levy is clearly causing problems for businesses.
“The increase in investigations suggests that HMRC focused on larger businesses initially as the value of potential underpayment was higher and is now widening its net to smaller businesses too.
“We have seen additional problems arise amongst large businesses where several different parts of the same businesses group may be liable to pay the Levy. However, there is little guidance to help businesses calculate their liabilities.
“The high number of investigations HMRC is launching into underpayment is a symptom of the wider problems that are hampering the scheme’s effectiveness. These urgently need addressing.”
An HMRC spokesperson said: “The levy helps to deliver new apprenticeships and supports quality training by putting employers at the centre of the system. Employers who are committed to training are able to get back more than they put in by training sufficient numbers of apprentices.
