How can you benefit from the Skills Development Levy?
If your company has Pay As You Earn (PAYE)-registered employees and your payroll is more than R500 000 per year, you have to pay the Skills Development Levy (SDL) to SARS every month. The purpose of SDL is to fund education and training as set out in the Skills Development Act. Read on to find out how you can benefit from paying the levy.
Whether you pay R50 or R5 000 per month for the Skills Development Levy, you're entitled to a levy rebate.
The Labour Law for Managers Loose Leaf Service explains that 'this rebate (mandatory grant) equals about 20% of the total amount paid. But, if you understand how to get the most out of the system, you can get back all the money you've paid.'
This is how you'll benefit from paying SDL
The Loose Leaf Service says each Sector Education and Training Authority (SETA) has different incentives available. Some of these include:
Regular free courses for training and development;
Free workshops for skills development facilitators;
Discretionary grants. This applies if you do training that's important for the sector, or in areas where skills are needed. These include learnerships and Recognition of Prior Learning, that'll certify employees if they have skills and knowledge gained through experience;
Special projects funding. This could be a training intervention you require, that the SETA thinks is important enough to fund. This'll be over and above the rebate system, for example, HIV and AIDS training if you're in the industrial sector;
Tax incentives and grants for learnerships;
Free assistance from your SETA;
SETA call centres that respond to enquiries; and
Assessment and moderation processes for course accreditation and learnership moderation.
Remember, when paying SDL, you use the same EMP201 form you use to pay over PAYE and Unemployment Insurance Fund (UIF). SARS will pay it over to the relevant industry specific SETA you belong to.
The above makes it worthwhile to contribute to skills development. The BEE Codes require you to report your skills development initiatives and spend. So this is just another reason to comply with legislation.