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3 Ways to benefit from grants and tax rebates: Skills development grants and rebates explained

Skills development grants and rebates explained

There are several ways to benefit from grants and tax rebates for skills development.

Mandatory grant

To qualify for a mandatory grant equal to 20% of the skills levy paid, a company must appoint a Skills Development Facilitator (SDF), complete an Annual Training Report (ATR) with all training provided to staff during the reporting period and a Workplace Skills Plan (WSP) – indicating the planned training for the coming reporting period.  The WSP and ATR must be submitted to the relevant Sector Education and Training Authority (SETA) by 30 April every year. A SETA will only pay out a company’s mandatory grant if the eligibility criteria for payment of mandatory grants are met. These criteria are:
  • Be registered in terms of the Skills Development Levies Act.
  • Has paid the levies as required by the SDLA.
  • All levy payments are up to date at the time of the approval and for the reporting period.
  • The WSP and ATR are submitted by the required deadline.
  • The WSP for the previous reporting period has been submitted and implemented according to the prescriptions for implementation by the SETA.
  • Any company who has a recognition agreement with a trade union or has any union in place will have to provide proof that the WSP and ATR have been subject to consultation with recognised trade unions and the WSP and ATR must be signed off by the majority union.

Discretionary grant

To quality for a discretionary grant equal to 49.5% of the skills levy paid, a company must keep proper records of all its PIVOTAL programmes that include learnerships, work integrated learning, internships, bursaries, and skills programmes. These records and the ATR and WSP must be submitted before the submission deadline, and the company’s skills development levy must be paid in full and up to date, to be taken into consideration for a discretionary grant.

Tax rebates

A company can claim an annual learnership allowance from the South Africa Revenue Service. To qualify for the allowance, the learnership agreement must be registered in accordance with the SDA and entered into before a certain date. The allowances are categorised as follows:
  • For a learner who holds an NQF 1-6 qualification: R40,000
  • For a learner who holds an NQF 7-10: R20,000
  • For a learner with a disability who holds an NQF 1-6 qualification: R60,000
  • For a learner with a disability who holds an NQF 7-10 qualification: R50,000
It is important to mention that these allowances only apply as ‘annual and completion allowances’; it is not a done deal that an applicant will receive such allowance for each learner.

Contact us

To find out how we can help your business with a skills development programme that will allow you to benefit from grants and tax rebates, contact us on 011 668 4300 or complete the contact form below and one of our representatives will be in touch with you.