|Make it work for you
The skills development legislation that has been with us since the middle of the 1990s is often considered as just one more of several tax laws. However, this legislation offers numerous opportunities that are being overlooked by many employers.
This, according to Frikkie Liebenberg, eminent skills development consultant from Bellville.
In this article we would like to shed more light on the key aspects of and opportunities offered by the legislation. The legislation is far more comprehensive than space allows here, but for the employer the following key facts are important.
The legislation makes provision for the payment of a skills levy (1% of the taxable salaries/wages) as well as a mechanism to claim back as much as 70% of the levy if the employer conforms with certain requirements.
The mangement of skills development is mainly regulated by the following three laws:
The purpose of the skills development legislation is to fund the improvement of skills levels in South Africa in a structured way. A second broad goal is to regulate the standard of education/training. For these purposes a National Qualification Framework (or “NQF”) was established.
The legislation divides South African industries into 12 broad industry categories. The agricultural industry forms part of the Agricultural and Nature Conservation categories. Within each industry category various sectors have been identified. Each sector has a Sector Education and Training Authority (SETA). Employers in the viticultural and oenological industry may register with one of three sectors.
The Skills Development Act makes provision for the registration of each employer (irrespective of size or turnover) to pay over 1% per month of their taxable salaries/wages to SARS. In turn SARS will channel 80% of the funds to the relevant Seta. In terms of the act Seta may use 10% of the funds for administration. 20% of the levy is paid over to the National Skills Fund.
Employers must complete form EMP 101 to register with SARS and complete form EMP 201 each month. The employer must indicate in the application to which Seta levies must be channelled.
Claiming back money
Although levies are paid over to SARS, funds are claimed back from the relevant Seta. After registration with SARS and a relevant Seta, the process is as follows:
Complete a Workplace Skills Plan.
Workplace Skills Plan forms are provided by the Seta to whom the levies are being paid and the format may differ from Seta to Seta. It is completed annually at the beginning of the specific Seta’s financial year.
The Workplace Skills Plan is simply a summary of the training plan/budget for the given financial year. It also requires information regarding the demographic composition of the work force as well as their educational qualifications.
Legislation also demands that the employer appoint a Skills Development Facilitator. The Skills Development Facilitator may be an existing employee who will be responsible inter alia for drawing up the Workplace Skills Plan.
The employer may claim back 15% of his/her levies if a Skills Development Facilitator is appointed and a Workplace Skills Plan submitted.
Workplace Skills Plan Implementation Report
A Workplace Skills Plan Implementation Report is completed at the end of a financial year and is a report about the actual implementation as opposed to the Workplace Skills Plan. It requires information about what actually happened in the course of the aforegoing financial year. Employers may claim back 45% of their levies if a Workplace Skills Plan Implementation Report is submitted.
If this is in line with certain sector specific training priorities (ABET, Aids awareness, apprenticeships and skills programmes) employers have access to a further 5 – 10% of their levy – also known as discretionary funds.
Employees who register learners in apprenticeships or skills programmes may also claim back additional monies, depending on the funds of the Seta. So for example the FoodbevSeta pays R50 per completed credit as well as an additional R4 000 if the apprenticeship is successfully completed. This may amount to as much as R10 000 per successful learner.
In addition to the above Minister Trevor Manuel has also indicated that employers are eligible for a tex exemption of as much as R25 000 if an apprenticeship is successfully completed.
Skills development is not aimed at levying and returning funds. The eventual focus is the improvement of the skills levels in your industry.
In general the Setas are very helpful in facilitating the process. Should you require additional help, phone 082 564 3208 .