Interns and Learnerships

Interns and Learnerships

Business, Human Resources

Author: Joe Ferreira (

It’s that time when companies plan if, and what type of schemes, they will implement to attract, upskill and retain future potential. Of course, with every scheme, there are costs and rebates which need to be carefully weighed up to identify which type of scheme will best suit the organization from a return on investment perspective, and naturally, the potential tax benefits of these schemes will also need investigation.

Let’s have a look at a few points worth considering:


These programs and initiatives can be hugely beneficial in that they are effective in addressing skills shortages and in many ways offer something back to society, which certainly bodes well for organisations wanting to create a “caring” profile amongst their peers in the marketplace.

Participants on these schemes usually have some form of formal diploma or degree, and through these internships are exposed to great practical experience in potentially very short periods of time.

Companies can decide the duration of an internship which can vary from a few weeks to 12 months. From a cost perspective, companies usually provide the individual on the program with a stipend that covers transport and food. Albeit a small stipend, the trade-off is that the program offers the individual an opportunity to get into their chosen field and to start gaining some experience.

The big plus is that the company gets to evaluate their work ethic, their commitment, their skill level and their suitability all round, resulting in some of these individuals actually getting full-time employment with the company.

From a tax perspective, the individual receiving the stipend will most likely not be liable for tax as their stipend (if it’s deemed as remuneration) will fall below the tax threshold for the year. As per the Income Tax Act, a stipend given as part of a scholarship to meet the education expenses is exempt from income tax under Section 10 (16).


A learnership is a little different in that it offers the individual the opportunity to get a nationally recognised qualification whilst on the program. From a tax perspective there are a number of benefits:

The individual can be on the ETI scheme even though they are on a learnership program. The company can save up to R 1 000 per month per individual on the scheme. This is in the form of a rebate against their monthly PAYE bill.

Depending on how those individuals are taken into full-time employment there are a number of points that can be gained for BBBEE scorecard purposes.

Under the Skills Development element for BBBEE purposes, up to 25 points can be acquired.

Finally, up to R 80 000 for an able-bodied learner and R120 000 for a learner with disabilities can be claimed as a rebate.


There are advantages and benefits to learnerships and internships which will vary from scheme to scheme and company to company, the deciding factor normally being the business requirements of the company as to which is more suitable.

The important point to bear in mind is that either scheme will improve the skill level of the individual, make them more employable and ultimately give them some level of experience, which our youth so desperately need.