The Apprenticeship Levy was announced by Chancellor of the Exchequer George Osborne in the July 2015 budget which was held following that year's General Election.
In this context, the pay bill is defined as the earnings liable to class 1 secondary National Insurance contributions.
The levy due by an employer is paid to HMRC through the Pay-as-you-earn (PAYE) process alongside payment of Income Tax, National Insurance contributions and money deducted from employees' wages in order to repay Student Loans.
[5] There are separate arrangements for the use of the money collected through the levy in each of England, Scotland, Wales and Northern Ireland, since apprenticeships are a devolved policy.
Any amount that remains unspent after that period will expire and will be reclaimed by HMRC, including the 10% contribution.