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Levies and Grants
The Skills Development Act makes provision for refunds to employers who have
provided training for their employees, through a registered provider. Employers
may also access grants from a relvant SETA.
What is the process for obtaining a refund on my Skills Development Levy?
Employers can claim back a portion of their Skills Development Levy paid to
SARS. Regulations to the Skills Development Act indicate that a company may
claim back two mandatory grants:
- 15% of its levy by submitting a training plan to their SETA
- 45% if they submit a training implementation report to their SETA
In terms of the Skills Development Act, the Seta may retain 10% of the Skills
Development Levy paid, for strategic interventions (this will be added to any
unclaimed levies held by the Seta). 10% of the Skills Development Levy paid may
be used by the SETA for administration, as per the Skills Development Act. The
remaining 20% goes to the National Skills Fund to fund large national social
projects in the area of skills development.
Skills Development Facilitators
The first step to participation in this process is to register a Skills
Development Facilitator (SDF). The SDF is an employee, or consultant to the
employer, who will perform a liaison and information-sharing role with the
Seta. The SDF is required to keep up-to-date with changes within the skills
development arena and Seta developments, and to communicate these back to the
employer and the employees within the organisation. For larger employers, the
SDF should be elected by means of consultation.
Grants
After registering an SDF, employers may access mandatory grants from a Seta.
These mandatory grants are available to all employers who currently pay their
Skills Development Levy to a particular Seta via SARS. Actual training costs
are not reimbursed. Rather, a percentage of the Skills Development Levy paid is
refunded.
There are two mandatory grants that are described in skills development
regulations:
Workplace Skills Plan (WSP) Grant
The WSP identifies training planned for the period 1 April to 31 March and is
an annual grant, due on 30 June, which allows the employer to claim back 15% of
their levy. The WSP needs to be completed in the particular Seta’s format and
submitted by the deadline date. The WEP is the most important grant application
as it is a requirement for participation in all other Seta grants and
incentives.
Annual Training Report (ATR)
The ATR reports on training implemented for the period 1 April to 31 March and
is also an annual grant, due on 31 May, which allows the employer to claim back
45% of their Skills Development Levy paid to SARS. (The rates of payout may
change as per the Skills Development Act, but will be published in regulations
to the Act.) The ATR must be completed in Seta’s specified format and submitted
by the deadline date.
Two additional discretionary grants are also available:
Employers may obtain an additional refund on their levy if they train
strategically. The SCG allows employers to benefit by obtaining 10% of their
levy paid to SARS. These grant applications apply to the period 1 April to 31
March.
Strategic Cash Grant (SCG)
The percentage employers can claim back for training strategically will
increase over time, while the amounts allocated to the mandatory grants (WSP,
ATR) will decrease over time. The Setas have the discretion to utilise the 10%
SCG portion for a grant to the employer.
Learnership Grants
Learnership grants are available to employers who meet specific Seta criteria,
which differ from year to year.
Employers implementing learnerships are also able to enjoy tax deductions,
available via SARS. An amendment to the Income Tax Act, finalised on 15 August
2002, states that an amount of R17 500 or R25 000 may be claimed as a tax
deduction by an employer when a learner signs a learnership agreement. The
employer may claim from SARS a further R25 000 when the learnership agreement
is completed.
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