People want to learn to play musical instruments for different reasons and to learn in many different ways. For those that learn best by rote by or by ear a study of music theory may not be appropriate, however, for others who want to learn to play but also to really understand the music that they play then a study of music theory can be very helpful.  I taught advanced music theory for Rotherham LEA for many years and I encourage all of my students to study music theory along with their practical skills from the start. It is a requirement to have a pass at music theory grade 5 before taking practical grades  6 to 8, although the ABRSM accepts a pass at a jazz piano grade 5 practical exam as an alternative to grade 5 music theory. The music theory grades up to and including grade 5 are largely concerned with aspects of musical notation, clefs, key signatures, technical names for scale degrees, intervals, transposition, chord construction, cadences, technical terms, ornaments and orchestral instruments. Although it is the case that in general a lot of learners take grade 5 music theory exams to enable them to continue with the higher grade practical exams I try to encourage my students to carry on with the study of music theory beyond grade 5, and also to study aspects of music theory which are not covered by the graded exams. 
In particular I encourage students to study harmony and musical form as this leads to a greater understanding of the structure of music and how western tonal music "works". An understanding of triads and simple forms such as AABA from an early stage helps  students to not only play music but to really understand it. As students progress I encourage them to study increasingly complex concepts such as chord inversions, chromatic harmony, chord substitution, passing notes, suspensions, upper extensions to chords etc. I like students to understand the use of Roman numerals in traditional harmony, figured bass but also to be able to read a jazz lead sheet and know how to "voice" chords from symbols such as Dm7b5, G7alt etc. A good understanding of these concepts provides a solid basis for the the study of improvisation and composition in styles ranging from classical to jazz, blues, pop, rock, gospel and new age. 
On my own learning journey I have found that as I learn more my love of music grows and I realise that there is so much more to learn!
I often supplement my online piano lessons and online music theory lessons by making videos which I share with my my students either via WhatsApp or by posting them on Youtube. In this video I explain the concept of musical intervals and discuss their numeric values and quality. I use an app in this video called Classroom Maestro which I also use in my online piano lessons and online music theory videos. In Classroom Maestro the notes on the virtual keyboard light up as I play them and and are also displayed as musical notation together with a description of the interval. An understanding of musical intervals is a requirement for the grade 5 theory exam and is also very helpful in understanding the construction of chords.

In this video I work through sample questions from the ABRSM grade 5 theory exam which is in the new multiple choice format. For this question a knowledge of Treble, Bass, Alto and Tenor Clefs, Key Signatures, Transposition and Musical Intervals is required.