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SARS Tax Breaks as a legislative learnership benefit
Many companies trading today aren’t aware of the benefits of learnerships or even that such skills and development programs go all the way back to 1962.
The aim of such initiatives has always been to bridge the barrier to opportunities that the unemployed experience due to skills shortages.
It is a common misperception by many in the businesses world to think that learnerships are a costly enterprise with no real benefits on the part of the host company. On the contrary, learnerships come with a host incentives and benefits, the most lucrative being SARS tax breaks.
SARS makes provision for companies registered for learnerships to get tax rebates of up to R60 000 per individual that stays for their full internship, irrespective of whether such a learner actually goes on to work full-time or otherwise. Such tax returns are sufficient in themselves to cover the costs of hosting a learner from salaries.
Refer to the extract from Section 12H into the Income Tax Act no. 58 of 1962 below...
The tax breaks offered to employers are the following:
In respect of learner who is not employed with the employer at the time of entering into the learnership
- Upon entering into a registered learnership agreement (before 1 October 2011), a deduction from income equal to the lesser of R30 000 or the annual equivalent of the remuneration of the learner; and
- Upon completion of the registered learnership agreement (before 1 October 2011) a deduction from income equals to the lesser of R30 000 or the annual equivalent of the remuneration of the learner.
In respect of learner who is employed with the employer at the time of entering into the learnership
- Upon entering into a registered learnership agreement (before 1 October 2011), a deduction from income equal to the lesser of R30 000 or the annual equivalent of the remuneration of the learner; and
- Upon completion of the registered learnership agreement (before 1 October 2011) a deduction from income equals to the lesser of R30 000 or the annual equivalent of the remuneration of the learner.
Contracts of apprenticeship registered in terms of section 18 of the Manpower Training Act no. 56 of 1981 also qualify as registered learnership agreements. Employers who require further information on Tax Rebates may contact the SARS OFFICES on www.sars.co.za .