BEE Partner, South Africa Economy Watch

Skills development element	Weighting points	Compliance target
Adjusted skills development spend on learning programmes for Black employees as a percentage of the leviable amount	25	2%

The QSE skills development scorecard only contains one indicator. It is significantly simpler than skills development of non-QSE businesses and easier to obtain a higher score. Unfortunately, because the target is based on terms and calculations used in the Skills Development Levies Act, the SDLA, this is a technical section.

Indicator terminology

Leviable amount

The leviable amount is derived from the SDLA. It the amount that the levy that must be paid to the SETA is calculated on. BEE uses the same calculation and therefore terminology, but sets a target over and above that payable to the SETA. The scorecard sets the target for the indicator as 2% of the leviable amount for QSEs. Essentially, the leviable amount is the annual total net salaries and wages payable by the entity.

Calculating the leviable amount

From a BEE perspective, the importance of the SDLA lies in its definition of the leviable amount. This is a technical section and most companies will be aware of the leviable amount from their SDLA submissions. The breakdown that follows is for those readers who do not make SDLA submissions.

As a basic estimate, the leviable amount is the combined taxable income of all employees. The term “leviable amount” is defined by Statement 400 as taking its meaning from the SDLA and used in conjunction with Schedule IV of the Income Tax Act.

The SDLA defines the term “leviable amount” as:

The total amount of remuneration paid or payable, or deemed to be paid or payable, by an employer to its employees during any month, as determined in accordance with the provisions of the Fourth Schedule to the Income Tax Act for the purposes of determining the employer’s liability for any employees‘ tax in terms of that Schedule, whether or not such employer is liable to deduct or withhold such employees‘ tax.

The remuneration paid to employees below the income tax threshold, in other words those cases where no SITE or PAYE is deducted, must be included in the remuneration for determining the leviable amount. The remuneration of directors of companies as well as members of close corporations must also be included. The leviable amount is calculated by using the actual remuneration of the director.

To obtain the full meaning it is necessary to understand the definition of remuneration and the exclusions when determining the leviable amount.

Remuneration

Remuneration means any amount of income that is paid, or is payable, to any person whether in cash or otherwise and whether or not in respect of services rendered. Examples include the following:

Annuities

Bonuses

Commissions

Director’s remuneration

Emoluments

Fees

Gratuities

Leave encashment

Lump sum payments

Pensions

Remuneration for overtime

Retirement allowances

Salaries

Stipends

Superannuation allowances

Voluntary awards

Wages.

The following are specifically included in the remuneration when determining the leviable amount:

Restraint of trade payments

An amount received or accrued in commutation of amounts due in terms of a contract of employment or service

• an amount received or accrued in respect of the relinquishment, termination, loss, repudiation, cancellation or variation of an office or employment or an appointment
• 50% of an allowance paid or advance given to an employee or holder of a public office in respect of the expense of travelling for business purposes (excluding an allowance paid for actual distance travelled for business purposes, at a rate not exceeding the rate per kilometre fixed by the Minister of Finance in the Government Gazette)

• 50% of an allowance paid to a holder of a public office
• fringe benefits received in terms of Schedule VII to the Income Tax Act
• a gratuity received by, or accrued to, a person from his or her employer because such person obtained a university degree or diploma or has been successful in an examination.

The following amounts are excluded from remuneration:

• common-law independent contractors, but excluding independent contractors who are subject to the control or supervision of any person as to the manner in which their duties are performed or as to the hours of work, or if the amounts paid or payable to them are payable at regular daily, weekly, monthly or other intervals
• any pension or additional pension under the Aged Persons Act or the Blind Persons Act
• any disability, grant or additional or supplementary allowance under the Disability Grants Act
• any grant or contribution under the provisions of Section 89 of the Children’s Act
• amounts paid to an employee wholly in reimbursement of expenditures actually incurred by such an employee (that is, expenses incurred on behalf of the employer on an agency basis), in the course of employment

Any allowance or advance in terms of an order of divorce or decree of judicial separation or agreement of separation.

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