What is Skills Development Levy?

The skills development levy is a compulsory levy scheme for the purposes of funding education and training. When your business becomes liable for skills development levy it will be calculated as an amount of money that you have to pay to SARS for the development of skills of your employees.

Who has to contribute?

All employers are required to register for Skills Development Levies except-

  • religious or charity organisations;
  • employers,

 

  • whose total salaries to all its employees is less than R 500 000 per year; and
  • who do not have to register the employees with SARS for PAYE purposes

What are your monthly obligations?

Employers will contribute a levy of 1% of the total amount paid in salaries to employees (including overtime, leave pay, bonuses, commissions, lump sum payments) every month.  The levy may not be deducted from the employees’ pay. The levy will be included on the monthly return containing your PAYE and UIF contributions and must be paid to SARS by the 7th day of each month.

What are the benefits of these levy contributions?

To encourage workers:

  • To use the workplace as an active learning environment;
  • To provide employees with the opportunities to acquire new skills;
  • To provide opportunities for new entrants to the labour market to gain work experience;
  • To employ persons who find it difficult to be employed.
  • To encourage workers to participate in leadership and other training programs.
  • To improve the employment prospects of persons previously disadvantaged by unfair discrimination and to redress those disadvantages through training and education.
  • To ensure the quality of learning in and for the workplace;

 

To assist:

  • Work-seekers to find work;
  • Retrenched workers to re-enter the Labour market;
  • Employers to find qualified employees;
  • To provide and regulate employment services.

 

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