Vocational Training Levy effective from 1st October 2008 :
Vocational Training Levy Effective 1st October, 2008
What Is VTL?
The Vocational Training Levy is a levy imposed by the Minister of Labour as per the powers granted to him under Section 24 of the Vocational Training Act. In addition a Vocational Training Fund has been established by BOTA in which the levy amount will be paid into. The purpose of the fund is to reimburse employers who have trained their employees
Who Is Liable To Pay The Levy?
According to The Vocational Training (Levy) Order, 2008, the levy is payable by any person registered under Value Added Tax Act with annual turnover of P250, 000 or more.
How Is The Levy Paid?
The levy is paid based on the employer’s VAT turnover at the rate of;
(a) 0.2 percent in respect of annual turnover of P2 billion or less
(b) 0.05 percent in respect of annual turnover in excess of P2 billion.
The Levy shall be paid as per the VAT tax period, using Value Added Tax /Training Levy return. For purposes of the levy the turnover excludes exempt supplies. That is the turnover consists of only taxable supplies (zero and standard rated).
One cheque may be used to pay VAT and Levy. But a VAT refund should not be off-set against the Levy amount. For example, if you have a VAT refund return, we still expect you to pay over the levy as per your turnover.
What Happens If I Fail To Pay The Levy?
Failure to pay the levy attracts interest of 2% per month or part thereof on the outstanding amount compounded monthly.
Income Tax treatment of The Levy
·Training Levy is not an allowable deduction for purposes of Income Tax according to Section 39 of the Income Tax Act.
·Vocational training Reimbursement that the employers receive from BOTA is liable to tax as income according to section 28 of the Income Tax Act.
NB. Notwithstanding the fact that we deny training Levy as a deductible expense, the
actual cost of training qualify as an allowable deduction if wholly, exclusively
and necessarily incurred for the production of the assessable income.
Employer is any person registered under the Value Added Tax Act.
BURS has been mandated to administer and collect VTL on behalf of Botswana Training Authority (BOTA) with effect from 1st October 2008.
What Is VTL?
The Vocational Training Levy is a levy imposed by the Minister of Labour as per the powers granted to him under Section 24 of the Vocational Training Act. In addition a Vocational Training Fund has been established by BOTA in which the levy amount will be paid into. The purpose of the fund is to reimburse employers who have trained their employees
Who Is Liable To Pay The Levy?
According to The Vocational Training (Levy) Order, 2008, the levy is payable by any person registered under Value Added Tax Act with annual turnover of P250, 000 or more.
How Is The Levy Paid?
The levy is paid based on the employer’s[*] VAT turnover at the rate of;
(a) 0.2 percent in respect of annual turnover of P2 billion or less
(b) 0.05 percent in respect of annual turnover in excess of P2 billion.
The Levy shall be paid as per the VAT tax period, using Value Added Tax /Training Levy return. For purposes of the levy the turnover excludes exempt supplies. That is the turnover consists of only taxable supplies (zero and standard rated).
One cheque may be used to pay VAT and Levy. But a VAT refund should not be off-set against the Levy amount. For example, if you have a VAT refund return, we still expect you to pay over the levy as per your turnover.
What Happens If I Fail To Pay The Levy?
Failure to pay the levy attracts interest of 2% per month or part thereof on the outstanding amount compounded monthly.
Income Tax treatment of The Levy
·Training Levy is not an allowable deduction for purposes of Income Tax according to Section 39 of the Income Tax Act.
·Vocational training Reimbursement that the employers receive from BOTA is liable to tax as income according to section 28 of the Income Tax Act.
NB. Notwithstanding the fact that we deny training Levy as a deductible expense, the
actual cost of training qualify as an allowable deduction if wholly, exclusively
and necessarily incurred for the production of the assessable income.
[*] Employer is any person registered under the Value Added Tax Act.
Friday,January 16,2009 
