South African employers that pay the Skills Development Levy (SDL) can have access to funding through their Sector Education and Training Authority (SETA). The mechanism depends on the nature of the grant, the industry that the company operates in and the requirements of the relevant SETA.
One of the most important mechanisms is the 20% mandatory grant which can apply to a qualifying employer, based on their submitted Workplace Skills Plan (WSP) and Annual Training Report (ATR) and complying with the applicable requirements. The statutory deadline is generally 30 April in the year in question. (Government of South Africa)
The overall SETA system also includes discretionary funding for approved skills-development projects. However, these should not be regarded as an 80% refund to individual employers. SETAs decide on the allocation of these funds, based on rules, budget and sector priorities. (Government of South Africa)
The distinction is important for businesses, HR professionals and training organisations when budgeting for skills-development.
What is the Skills Development Levy?
The Skills Development Levy is a levy payable by employers to support skills development in South Africa.
According to SARS, it is possible that an employer will become liable for the levy “if his or her total remuneration is estimated to be more than R500 000 in the next 12 months,” subject to the exemptions in the law. The levy is generally 1% of the total amount of salaries and other qualifying remuneration. (South African Revenue Service)
The money forms part of the overall landscape of skills development funding, including SETAs and the National Skills Fund.
The Skills Development Act provides the framework for workplace skills strategies, learnerships and the overall levy-grant system.(Government of South Africa)
What do SETAs do?
Sector Education and Training Authorities are responsible for promoting skills development within specific economic sectors.
They develop sector skills plans, support learnerships, approve WSPs and allocate funding for qualifying skills-development activities.(Department of Labour)
An employer generally deals with the SETA that covers their area of economic activity.
This means a company needs to establish which SETA it is responsible to before applying for funding or submitting skills-development information.
How the 20% mandatory grant works
The mandatory grant represents one of the clearest ways in which an employer can receive funding from their SETA based on the levies that they have paid.
Under the SETA Grant Regulations, 20% of the levies paid by an employer in the relevant financial year qualifies for a mandatory grant, subject to the applicable requirements and approval of the WSP and ATR. (Government of South Africa)
This means that if an employer paid, say, R100,000 in SDL, 20% would be R20,000.
This is an example to illustrate the kind of amount involved. It should not be assumed that every employer is automatically entitled to the full 20%.
What must an employer submit?
The WSP and ATR are central requirements:
Workplace Skills Plan (WSP) – the organisation’s planned skills-development interventions.
Annual Training Report (ATR) – training undertaken in the previous reporting period.
Other supporting information as required by the relevant SETA.
The statutory deadline for the mandatory grant is generally 30 April each year, with an optional extension of up to one month under certain conditions.(Government of South Africa)
Employers can choose to use the specific forms, procedures and submission instructions of the individual SETAs. For example, Services SETA currently provides its forms for mandatory grants, including employee templates and guidance for employers.(Services ETA)
What happens if a company misses the deadline?
Missing the deadline can impact an employer’s entitlement to the mandatory grant.
According to the government-published skills-development guideline, late submission can result in the loss of the grant, while the regulations provide for a limited extension under certain conditions.(Department of Basic Education)
Employers should therefore not assume that all SETAs operate the same rules regarding late applications.
What are discretionary grants?
Discretionary grants differ from mandatory grants.
Instead of a specific refund based on individual SDL payments, discretionary grants are a way for SETAs to fund approved skills-development projects according to their own sector requirements and available budgets.
The Skills Development Act gives SETAs the power to provide funding for skills programmes, subject to conditions, funding availability and relevant sector priorities.(Saqa)
Services SETA, for example, says that discretionary grants are given to qualifying stakeholders for learning programmes according to available funds and the SETA’s priorities.(Services ETA)
What can discretionary funding support?
Depending on the SETA and funding window, projects can include:
Learnerships
Internships and workplace experience
Artisan development
Skills programmes
Other approved training interventions
Programmes addressing identified sector skills shortages
The specific programmes, funding amounts, eligibility criteria and application periods vary between SETAs.
This is why employers should not use generalised figures when applying for a discretionary grant.
Are SETA learnership grants a fixed amount?
No.
The original information commonly found online provides specific figures such as R40,000, R60,000 or R100,000 per learner, but these should not be regarded as generic SETA rates.
Funding depends on the SETA, programme, funding window, approved application and applicable conditions.
Learnerships also involve additional considerations beyond the grant. Employers hosting learners possibly have responsibilities relating to exposure at the workplace, supervision, records and compliance with the relevant learnership agreement.
The Skills Development Act provides for learnerships leading to recognised occupational qualifications.(Government of South Africa)
What about internship funding?
Some SETAs provide funding for internships or workplace-based learning, but there is no single national grant amount that applies to all employers.
An employer considering internship funding should establish:
- Whether their SETA has an open funding window.
- Eligibility criteria for categories of learners.
- Qualification or field of study required.
- Permitted duration of the internship.
- Funding or stipend conditions.
- Employer responsibilities at the workplace and in regard to mentorship.
- Documents that need to be submitted before funding can be approved.
These can change between funding cycles.
Can small businesses access SETA grants?
Small employers should not assume that they are ineligible simply because they employ fewer people.
The SETA Grant Regulations specifically provide for employers with fewer than 50 employees to use a simplified process for WSP/ATR where applicable.(Government of South Africa)
However, SDL liability and grant eligibility are separate issues. Employers should first establish whether they are legally required to pay SDL and then understand the requirements for their designated SETA.
SARS currently provides that employers with expected remuneration below R500,000 are exempt on that basis.(South African Revenue Service)
A practical way for employers to approach SETA funding
Businesses considering SETA funding can use the following approach:
1. Identify your designated SETA
Determine what SETA covers the company’s main economic activity.
2. Confirm SDL registration
Ensure that the employer is properly registered for the Skills Development Levy where applicable and that their SDL information is up to date.
3. Keep training records
Maintain relevant records regarding training, qualifications and workplace skills requirements for employees.
4. Prepare the WSP and ATR
The WSP should cover planned training and the ATR should reflect relevant training that has already taken place.
5. Submit before the deadline
For mandatory grants, the statutory deadline is generally 30 April.
6. Monitor discretionary funding announcements
Discretionary grants are normally associated with specific funding windows. Employers should use the information provided by their SETA and not rely on old advertisements.
7. Read the funding conditions
Before submitting an application, understand the eligibility criteria, required documents, approved programmes, payment methods and reporting obligations of the relevant SETA.
An important point about SETA grant percentages
A common misunderstanding is that an employer can claim the remaining 80% of their SDL as a discretionary grant.
This is not correct. The 20% mandatory grant has specific conditions. Discretionary grants are distributed according to the priorities, budgets and approved applications of the relevant SETA. Government material refers to the levy being distributed through the overall SETA and National Skills Fund system, rather than the remaining 80% being available as an automatic refund to the employer.([Western Cape Government][9])
This is an important consideration for an employer when budgeting for skills development during the year.
Where should employers verify grant information?
Since SETA funding windows and requirements can change, employers should consult:
Their designated SETA
SARS regarding SDL registration and levy requirements
The Department of Higher Education and Training for national skills-development information
The relevant SETA’s latest grant notice, application forms and guidelines
For example, Services SETA currently provides its 2026/27 Mandatory Grant information and supporting documents on its employer resources page.(Services ETA)
Employers should always use the current funding notice and not rely on grant advertisements from previous years.
What this means for South African businesses
SETA funding can be an important source for employers, but the distinction between mandatory grants and competitive discretionary funding needs to be understood.
For mandatory grants, the key annual activity is preparing the WSP and ATR information and submitting it within the prescribed time frame.
For discretionary funding, the process is more application-driven. Approval depends on the individual SETA’s rules, priorities and budget.
The most reliable approach is therefore to treat each SETA announcement as a primary source for a particular funding opportunity.
SETA Grants: Quick Reference
| Issue | What employers should know |
| ——————– | ——————————————————————————– |
| SDL rate | Generally 1% of qualifying remuneration |
| SDL threshold | SARS currently states R500,000 expected remuneration over the next 12 months |
| Mandatory grant | 20% of qualifying SDL paid, subject to the applicable requirements |
| WSP/ATR deadline | Generally 30 April each year |
| Discretionary grants | Project-based and dependent on SETA priorities and available funding |
| Grant amounts | Vary by SETA and funding programme |
| Learnership funding | Not one universal national amount |
| Internship funding | Requirements and funding vary by SETA |
| Small employers | Special WSP/ATR arrangements can apply to employers with fewer than 50 employees |
(South African Revenue Service)
Important information for employers
A SETA grant should not be regarded as a guaranteed payment simply because a company has paid SDL.
Employers should also be wary of websites or social media that advertise a specific payment amount per learner without identifying a relevant SETA funding notice.
The official information from a SETA and current application guidelines should always take priority over generic figures on the internet.
Editorial policy
Our articles should be regarded as providing useful, independently-presented information for South African readers. We seek to distinguish between verified information and interpretation and should not be regarded as presenting outdated funding information as current. Where requirements can change, readers are encouraged to confirm the latest information with the relevant government department, SETA or other authority.
Fact-checking and sources
This article has been checked against South African government and official institutional sources, including SARS, the South African Government, the Department of Employment and Labour, the Skills Development Act and official SETA information.(South African Revenue Service)
Corrections policy
Where an error is identified, we will check the information against authoritative sources and will correct the article where necessary. Where a correction materially changes the meaning of an article, the correction should be clearly indicated in the published content.
Disclaimer
This article is provided for general information and educational purposes. It is not an official SETA funding notice, tax or legal advice. Grant eligibility, funding amounts, application periods and documentation requirements can change. Employers should confirm the latest requirements with their designated SETA and SARS before taking any action.
Sources
South African Revenue Service — Skills Development Levy
South African Government — Skills Development Act
South African Government — SETA Grant Regulations
Department of Employment and Labour — Basic Guide to Skills Development Levies
Services SETA — Employer Resources and Mandatory Grants
Updated: 23 September 2026
