SKILLS DEVELOPMENT LEVY

SKILLS DEVELOPMENT LEVY:

This is a compulsory levy scheme to fund education and training as envisaged in the Skills Development Act, 1998. This levy came into operation on 1 April 2000 and is payable by employees monthly.

South African Revenue Services (SARS) is responsible for collecting the levy. The levy is fixed at 1% “leviable amount.” The “leviable amount” means “the total amount of remuneration, paid or payable, or deemed to be paid or payable, by an employer to its employees during any month.”

DISTRIBUTION OF 1% SKILLS DEVELOPMENT LEVY:

  • 18% of the levy paid goes to the NSF (National Skills Fund) for national skills development priority projects.
  • SARS retains 2% of the funds for the administrative costs to collect the money.
  • SARS pays 80% of levies to the relevant SETA. The monies allocated to the SETA are used as follows:
    • The SETA retains 10% of the administration costs of the SETA.
    • 20% is designated as Mandatory Grants to fund education and training programmes contained in the WSP and ATR.
    • 50% is designated as Discretionary Grants to be spent at the discretion of the SETA in support of the implementation of its Sector Skills Plan.

The following grants are available to all levy-paying companies:

  • Mandatory Grant: A Mandatory grant may be applied for (via WSP/ATR) no later than 30 April of each year. The Mandatory Grant payment equates to 20% of the Skills Development Levy paid by the company to SARS.
  • Discretionary Grant: The money allocated within the SETA to be spent on discretionary grants and projects. The SETA must allocate at least 80% of its available discretionary grants within a financial year to PIVOTAL programmes to address critical skills in its sectors.
  • PIVOTAL Grant: PIVOTAL is an acronym that means professional, vocational, technical, and academic learning programmes that result in qualifications or part qualifications on the NQF.

 

IMPORTANT TO NOTE:

  • A company with an annual payroll of less than R500,000 can also submit for Mandatory Grants to be eligible for Discretionary Grants.
  • Levy-exempt organisations such as NGOs, CBOs, NPOs and FBOs may apply for a T-Number that entitles the organisation to use for discretionary funding.
  • Grants are not refunded automatically; employers must apply for these grants to be repaid.
  • The Skills Development Facilitator (SDF) must process applications for grant funding.
  • Learnerships, dependent on their nature, is funded from either the Discretionary Grant or PIVOTAL Grant fund of the SETA.
  • Applications for both Discretionary and PIVOTAL Grant funding are not limited to the value of Skills Development Levies paid by the company.

 

LET SA CAMPUS TAKE CARE OF YOUR WSP/ATR SUBMISSIONS. PLEASE DO NOT DELAY. CONTACT US TODAY!

Author: SAC Online

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