Learn More, Earn More: Claim back up to R 120 000 from the learnership tax allowance programme.
Training and development for employees plays a vital role in the growth and success of a company but the concern of a limited budget leaves the employer to think that employees “will learn on the job”. Fortunately, employers will be pleased to know that the learnership tax allowance (section 12H of the Income Tax Allowance Act No. 58 of 1962) has been introduced by SARS as an incentive for employers to encourage skills development, though the implementation of learnerships, within their workplaces and while simultaneously contributing to job creation and economic growth.
It’s effectively a tax deduction, whereby an employer (or company) may claim tax for the financial year and, the tax incentive is permitted for any of its employees or unemployed individuals in terms of a registered learnership agreement settled between the ‘learner’, employer and the relevant SETA before 1 April 2022. This agreement has been registered with a specific SETA (Skills Education Training Authorities), in compliance with the Skills Development Act. Employers must be mindful to complete IT180’s in respect of all learnership agreements for which a tax allowance should be successfully claimed.
The allowance will be higher for those employees who have a disability partaking in the learnership agreement, as compared to those without a disability.
Person without disability
R 80 000
Person with disability
R 120 000
A deduction of the Learnership Tax Allowance constitutes a deduction in addition to other income tax deductions allowable to employers for the employment and skills development of employees. If a learnership is terminated before a period of 12 full months, the employer will be entitled to a pro-rata portion of the commencement allowance, regardless of the reason for the termination of the learnership. The learnership tax allowance is available until April 2022.
Can learnership implementation boost your organisation’s B-BBEE scorecard?
Skills development is one of the key features of the B-BBEE Act. Skill development doesn’t only apply to your employees, you can also empower the industry by introducing skills development learnerships at your workplace.
And the best part is, these learnerships will help you with your B-BBEE scorecard. Skills development contributes 20 points to the scorecard. These points are split between the level of investment in skills development as a percentage of payroll, as well as people employed through learnerships.
But before you set up a learnership in your company to enhance your B-BBEE scorecard make sure it complies with these six criteria.
According to the Practical Guide to Human Resources Management, your company’s learnership programme must:
- Consist of a structured learning component;
- Include practical work experience;
- Be registered through a SETA;
- Be governed by a learnership agreement;
- Lead to a SAQA NQF registered qualification; and
- Relate to an occupation.
If it meets the above criteria, you can use your company’s learnership programme to add an additional 20 points to your B-BBEE scorecard as well as ensure you have a handful of well-trained recruits to pick from when hiring.
For more information on learnership implementation and how learneships can benefit your organisation, get in touch today via firstname.lastname@example.org. Alternatively, fill in our enquiry form and we’ll get back to you!