How to Apply for an Australian Apprenticeship Support Loan

Starting out as an apprentice can be an exciting and challenging time, but it can also be a costly one.

For many, purchasing the necessary tools for their trade can be a significant financial burden.

However, there is some good news.

If you are an apprentice in Australia, you can apply for an interest-free loan up to a maximum of $25,643 (for financial year 2024-25) under the Australian Apprenticeship Support Loan (AASL) program to buy supplies and tools of trade, and to help with cost of living expenses.

To be eligible for an AASL, your Australian Apprenticeship must be in a skill or trade on the Australian Apprenticeship Priority List.

Borrowers are exempt from paying back their loans until their income reaches the minimum repayment threshold. The loan amount will be adjusted each year in accordance with the Consumer Price Index so that the loan's real worth remains constant.

As a bonus for completing your qualification, your loan amount will be discounted by 20% once your apprenticeship is finished.

For some apprentices, this loan can be a game-changer. It can help them get started in their trade, allowing them to gain the skills and experience they need to succeed.

The Australian Government often puts measures in place to help apprentices thrive, with financial support being a key strategy. This assistance is designed to help apprentices and trainees stick with and succeed in their training journeys, a recent NCVER report highlighted.

How Much Can I Borrow?

You choose how much money to borrow with an Australian Apprenticeship Support Loan.

The most you could borrow in a lifetime is $25,643 (for 2024-25), which you could pay back over the four years of your apprenticeship or take a small amount over a few months.

What Can I Spend the Loan on?

You get to decide how to spend the loan money. You could pay for your living costs with the loan, buy tools or boots for work, or save your payments to buy a car.

Remember that you have to pay the money back no matter what.

How Do I Pay the Loan Back?

When you hit the required repayment amount of $54,435 (for the 2024-25 financial year), you must start paying back your Australian Apprenticeship Support Loan.

Like a HECS-HELP loan, the payments are made through income taxes.

How are Australian Apprenticeship Support Loans Repaid?

If someone earns below a certain amount, they must start paying back their AASL through taxes. The more they earn, the more they have to pay back.

The Australian Tax Office (ATO) calculates how much they owe each year and adds this to their tax bill. Every year, this amount is adjusted for inflation using the Consumer Price Index, which might increase to match living cost changes.

In addition to compulsory repayments, the individual can make voluntary repayments at any time and for any amount. These repayments are not refundable and there are no discounts or penalties for making a voluntary repayment.

Eligibility Criteria

To qualify for the Australian Apprenticeship Support Loan, you need to be:

1. Completing an Australian Apprenticeship (full-time, part-time and school-based Australian Apprentices and Trainees can access the loan), and
2. Enrolled in a qualification on the Australian Apprenticeship Priority List, and
3. Aged over 18 years old (or have parent or guardian support to take out a loan)

The Australian Apprenticeship Support Loan is one way the government is working to support the next generation of skilled workers and help them get started on their career paths.

Australian Apprenticeship Priority List

The Australian Apprenticeship Priority List identifies occupations experiencing a current or projected national skills shortage in Australia. The Australian government develops the list. It is regularly reviewed to ensure that it reflects the changing needs of the Australian economy.

The list is developed by various stakeholders, including industry representatives, employer groups, unions, and government agencies. These stakeholders work together to identify the high-demand skills and the industries that require skilled workers.

Some examples of occupations on the Australian Apprenticeship Priority List include automotive mechanic, bricklayer, carpenter and joiner, electrician, plumber, fitter and turner, and air conditioning and refrigeration mechanic.

Applying for the Australian Apprenticeship Support Loan

Applying for an AASL can be confusing, but with this step-by-step guide, you'll know exactly what to do.

Step 1: Check your eligibility. Before applying for the loan, ensure you meet all the eligibility criteria listed above. You must be an Australian apprentice, enrolled in a Certificate III or IV level qualification that leads to an occupation on the Australian Apprenticeship Priority List.

Step 2: Gather your documents. To apply for the loan, you must provide proof of your eligibility. You may need to provide evidence like your apprenticeship agreement or a letter from your employer confirming your employment.

Step 3: Talk to your assigned Apprentice Connect Australia Provider. Your Provider will take you (and your parent or guardian if you’re under 18) through the loan program in detail.

Ready to start your apprenticeship? At MIGAS, we connect you with top-notch job opportunities in trades that matter. From engineering apprenticeships to automotive and electrical, find your fit with MIGAS.

Start building your future today by visiting our Jobs Board.