John Redgrave, owner of JRM Motors, says it was a genuine mistake that he fell foul of the new changes that had come into force.
Redgrave took on an apprentice from Hartlepool College of Further Education as he had done for the past 30 years without issue.
However, during the course of the scheme his apprentice turned 21, making him eligible for a higher wage.
The issue came to light six months later, when Mr Redgrave set about making the changes to his pay to correct the problem.
Mr Redgrave said: “This wasn’t a deliberate act. I have taken on apprentices for 30 years and never had any problems.
“I’ve got one lad working for me now who started as an apprentice.
“This was a genuine mistake, as soon as I was made aware of it, I put it right. But by then I had been caught.
“It’s left me aggrieved as there was no support from anyone. I won’t be taking on anymore apprentices now.”
Commenting on the news, Jim Gillespie wrote on a local media website: “I’ve known John for many years and know he is a decent, hard working small business owner.
“As a small business owner myself, I know how hard it is to keep abreast of all the rules, regulations and revenue instructions.
“Errors of this nature are easily done when taking on apprentices.”
Does a fear of red tape put you off hiring apprentices? Are regulations preventing you from investing in young talent? Share your comments below this article.