If you work in the construction industry you will no doubt have heard of the CITB (and those working within payroll will have definitely heard of the CITB levy!) - but who exactly are the CITB and what is the purpose of the levy?
Who are the CITB?
The Construction Industry Training Board (CITB) is a public body who focus on attracting amazing talent, developing skills and setting excellent training standards within the British construction industry.
The purpose of the board is to
- Target their knowledge and resources to develop a world-class workforce for the challenges of today and tomorrow
- Look to get the best new talent by promoting construction for its exciting and rewarding career opportunities
- Work with the industry to ensure training standards and qualifications are right for its needs
- Strive to provide employers with the training they want for their people when they want it
- Look to make it easy for levy-paying firms to get funding for innovation and skills development
- Continue to talk, listen, research, survey, question and analyse the industry to stay ahead of change and respond to the sector’s evolving needs.
The levy
In order for the CITB to provide the above services to the construction industry, a ‘levy’ is applied to employers that mainly engage in construction industry activities. So, if a company’s employees, contractors and subcontractors make up at least half of the workforce engaged in construction activities, then the levy applies.
How much is the levy?
The amount of levy a company pays annually depends on the size of the company and their wage bill. During 2020, deductions were 0.35% for PAYE employees and 1.25% NET for CIS workers, however the 2021 levy rates could see a proposed reduction of a whopping 50% in an attempt to assist with stabilising the construction industry following the constraints caused by COVID –19.
(Please note there are reductions and exemptions for smaller businesses please see www.citb.co.uk for more info).
The CITB levy is currently applied to the following types of payments:
- Employees paid by a company that are required to make levy contributions (including those on furlough)
- CIS subcontractors where the company has made CIS deductions (including labour only and supply and fit subcontractors)
*It’s worth noting, if a subcontractor has ‘gross status’ with HMRC and are paid with no CIS deductions, the levy is not applied.
How do businesses pay the levy?
If the levy applies to your business, you’ll need to complete a CITB levy return. Once you’ve received the levy assessment notice, you’ll then need to make payment via direct debit or a lump sum to the CITB.
Who benefits from the levy?
Grant’s generated from the levy are distributed to construction employers - regardless of their size - in order to support training, increase work base skills, promote recruitment and develop industry standards.
CITB registered companies and employers contributing to the CITB levy can apply for grants to fund employee training, skill development and increased health & safety standards.
Businesses are categorised by size from Micro (1 - 9 employees), Small (10 - 49), Medium (50 - 249) and Large (250+) and the below table represents how the funds of 2017-2018 were distributed across construction industry employers:
|
|
Micro employers |
Small employers |
Medium employers |
Large employers |
Other |
Total |
|
Levy funds from employers |
£45.7m |
£50.9m |
£51.1m |
£63.4m |
- |
£211.3m |
|
CITB grants and support for training |
£26.2m |
£32.5m |
£47.8m |
£72.6m |
Not known |
£248.4m |
|
Number of employers claiming grant and other support |
9,159 |
5,162 |
1,422 |
265 |
907 |
16,919 |
CITB Apprenticeships
Another huge benefit of the CITB scheme is the ability for an employer to hire an apprentice and apply for an apprenticeship grant. Whether hired through the CITB directly or through an approved apprenticeship partner; once the apprenticeship has commenced, employers can now apply for ‘attendance’ and ‘achievement’ grants of approximately £2500/year and £3500/completion respectively.
And that’s not the only benefit! By partnering with an apprenticeship scheme via the CITB, businesses will also be allocated an apprenticeship officer at the CITB to offer continuous, direct support.
With an endless list of exciting apprenticeships available, ranging from blue-collar trades such as bricklaying, carpentry and electricians through to white-collar positions such as site managers, architects and surveyors, bringing on an enthusiastic and hardworking apprentice really in a no-brainer! As a bonus, following on from the 2021 Budget there has been an uplift in payments for employers hiring new apprentices. Check out our latest blog here for all the details!
For more information on the CITB and how your business can benefit from the levy, check out their website!
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