How you can benefit from the Skills Development Levy

Posted on 31 Comments

Do you, as an employer, understand why you are paying a Skills Development Levy (SDL)? Do you know that this gives you access to funds for training? Many business owners just see it as a compulsory payment of 1%  from their monthly payroll, and that’s it.

“Many employers don’t realise that they are able to claim a portion of this money back from their Sector Education Training Authority (SETA). There is a pool of funds available through Skills Development that they have access to, that is rightfully theirs, but that they probably don’t know about, or don’t fully utilise,” says Stephanie Engelbrecht, Skills Development Consultant of Moonstone Information Refinery.

Engelbrecht clarifies that employers with a total salary bill of R500 000 + over a 12-month period are required to pay SDL levies to SARS every month, according to the Skills Development Levy Act (1999), However, any employer whose total remuneration to all its employees over the next 12 month period don’t exceed R500 000, can also make use of this benefit to submit and claim.

The levies are then paid over to the particular SETA to encourage employers to train and upskill their employees. By complying with certain legal and procedural requirements, employers may claim up to 70% of the SDL back from their SETA.

The benefits of paying Skills Development Levy include:

  • 20% of your levy can be claimed back in a Mandatory Grant
  • 50% of your levy can be claimed in Discretionary Grants (Learnerships, Skills Programmes, Apprenticeships, Workplace Experience Placements, Internship and Bursaries)
  • Tax rebates on registered learnership programmes

Requirements to claim Skills Development Levies:

  • Register as a Skills Development Facilitator (SDF)
  • Submit a Workplace Skills Plan (WSP), indicating training planned for the next reporting period
  • Submit an Annual Training Report (ATR) as proof of the training conducted during the previous reporting period

To some employers, the skills development procedural requirements may seem like a mammoth task. “By assisting businesses with Skills Development, which looks like an impossible task to HR, we can give them access to these grants,” Engelbrecht explains. “With the 30 April deadline of the annual Workplace Skills Plan & Annual Training Reports  fast approaching, Moonstone is ideally positioned to help companies with the successful submission of their reports.”

By ensuring successful report submission, companies can also optimise their BEE score.

Moonstone is ready to work with companies to align their WSP to their BEE and Employment Equity targets, ultimately, allowing the organisation to identify areas where skills are needed and plan interventions to answer the needs. “Our consultants have the expert skills and knowledge of more than 18 years in their field to advise them on the best practice process to compliance,” Engelbrecht concludes.

For more information, contact the Moonstone team at workforcesolutions@moonstoneinfo.com

31 thoughts on “How you can benefit from the Skills Development Levy

  1. Can I claim SDL as an employee, as I have paying without any opportunities to these trainings?

    1. No, you cannot.

  2. Can company pay my school fees with Skils Development Levy??

    1. No.

  3. Can I apply for drivers license through the skills development levies?

    1. No, you cannot.

  4. Then if we can’t claim in anyway on it, Why do we have to pay SDL.. In other words the SDL R2790.76 i pay every month, is for nothing.. and actually the company takes away my hard earned money, for others that didn’t work for it, because they can..

    1. The company can claim back the money by implementing training for staff.

      1. Is the company then permitted to lock employees into a professional development contract stating they may not leave the school for a period of time, or have to pay the monies back?

        1. This depends on who is paying for the studies. If it is the SETA, then no. If it is the business, then there could be a bursary agreement or study agreement put in place.

    2. Why are you paying the Levy? It’s your employer’s duty.

  5. Can an organisation also claim back the salary or a portion of the salary of a SDF, if so, is it seperate from the Mandatory grants which can be claimed by an organisation?

    1. No, an organisation cannot.

    2. Hi the problem is that I want to creat a jobs for people to get jobs , so I don’t have that 1000 every months but I need that grant

  6. Can the company claim portion of my self development fund on behalf of me, and the company refund me that money?

    1. No, it cannot.

  7. As a skill training provider, could you please advise how I can identify companies that contribute to sdl so I can propose training for them…..which sectors in most cases in south Africa

    Thanks

    1. Go to Skills Universe and ask them. You are actually asking someone to disclose protected information. Do your own market research.

  8. I am interested in doing the SDF course, which institution or training provider do you recommend.

  9. Hi there I’ve been in the elevator industry from more then 10 years for different companies now I’m working for nu-line elevator maintenance I would love to do my trade test can I do with through Seta and this skill levy that I’ve been paying every month then pay for my trade test

  10. How does it work if an employee wants to go for a course or training? Does the company pay the costs first and then how does one claim back?

    1. There are two options: The company can either use the money from the mandatory grant to pay for the employee’s studies or it can apply for a discretionary grant for the employee.

  11. The benefits of paying Skills Development Levy include:

    20% of your levy can be claimed back in a Mandatory Grant
    50% of your levy can be claimed in Discretionary Grants (Learnerships, Skills Programmes, Apprenticeships, Workplace Experience Placements, Internship and Bursaries)
    Tax rebates on registered learnership programmes

    when the company claims these amounts back, is it taxable? if so, what % please

    1. No, these are not taxable.

  12. Great article.as an employee of an electronic and instrumentation company that has been paying this levy for more than a decade and has never utilized this fund. how can I as an employee go about when trying to use this fund when trying to get my trade from a authorize training provider?

    1. Although SDL shows up on the payslip, it is 100% contributed by the business, and therefore the business does the application for funding. The employee can however contact their SDF and express their interest in wanting to obtain training.

  13. How do I as an employee of a company who has being paying this fund benefit I want to study a computer short course to upskill myself who do I go about starting do I contact Sars?

    1. Although SDL shows up on your payslip, it is 100% contributed by the business and therefore the business does the application for funding.

  14. This is too risk for the co mpany that are state as there are corruption in those company

  15. Hi, is the 20% and 50% claimable amount based on the annual SDL or the SDL the company has paid over its lifetime contribution to date? So if SDL was paid for 5years, is 20% of 5years’ worth of payment claimable by the company?

  16. Thank you for this informative article. I work for an NPC and we’ve been paying SDL for years but we are not registered with any SETA. Are we able to claim it back and is this something you can assist us with?

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