The "Double Deduction": How the Section 12H Learnership Allowance Really Works

The Section 12H Learnership Allowance is one of the most powerful financial incentives for South African employers. Its power lies in a "double deduction" feature: it is an additional tax deduction, claimed over and above the normal deductions for employee wages and training costs. This directly reduces your taxable income, resulting in a substantial tax saving.

To claim it, you must have a formal learnership agreement registered with the relevant SETA. The allowance is comprised of two distinct parts:

1. The Annual Allowance

This allowance is claimable for each year of assessment that the learner is part of the agreement.

• Value: For an NQF 1-6 learnership, the allowance is R40,000. This amount is even higher for learners with a disability, at R60,000.

  
  

• How it works: The value is pro-rated based on the number of full months the learner was active in your financial year.

  
  

2. The Completion Allowance

This is a once-off "bonus" allowance claimed in the year the learner successfully completes the learnership.

• Value: This is typically an additional R40,000 (for NQF 1-6) or R60,000 (for a learner with a disability).

  
  

• The Multiplier: For longer programs (24 months or more), this completion allowance is multiplied by the number of consecutive 12-month periods. This creates a massive incentive for employers to invest in comprehensive, multi-year qualifications.

  
  

How We Help

This entire process, from SETA registration to ensuring you have the correct documentation (like the SARS IT180 form ), can be complex.

White Paper Systems manages this entire process. We ensure every learnership is correctly registered so you can be 100% certain you can claim these powerful tax benefits without any administrative headaches.

Contact us today to learn how our placements can reduce your taxable income. www.whitepaperconcepts.co.za