The Construction Industry Training Board (CITB) says that raising the threshold will remove levy obligations from 5,000 small businesses. They can continue to claim CITB grants and support for their training and skills development, however.
CITB’s proposal to raise the threshold came out of discussions earlier this year with industry leaders, stakeholders and a cross section of construction employers on industry priorities and funding. Views from employers have been built into CITB’s Levy Proposals for the 2021 Levy Order and Strategic Plan 2021-25, which have now been submitted to the Department for Education (DfE) for approval.
Consultation showed that 85% of employers supported an option to increase the levy exemption threshold. Approximately 35,000 employers are already exempt from paying levy under the current system, where firms with annual wage bills of less than £80,000 are exempt. The proposed threshold increase to £120,000 taks the number of exempt businesses up to 40,000.
CITB is also confirming its proposals to halve levy rates in 2021-22, cutting next year’s Levy bills by 50%. The proposed rates are PAYE @ 0.175% and Net CIS @ 0.625%.
CITB policy director Steve Radley said: “Taking 5,000 of the smaller employers out of levy payment is another measure to help deliver on our priority to help employers stabilise and then return to growth. We are pleased to confirm that we have submitted proposals to halve levy rates for next year. Later this month we will publish our Strategic Plan that will set out how we plan to invest the levy to support the recovery.”