SAF Levy
Skilling Australians Fund (SAF Levy)
Skilling Australians Fund (SAF) levy
Employers must pay the applicable nomination training contribution charge referred to as the Skilling Australians Fund (SAF) levy.
The purpose of the SAF levy is for employers to contribute to the broader skills development of Australians.
The levy funds are managed by the Department of Employment and Workplace Relations (DEWR)
The Department of Home Affairs calculate the required SAF levy amount which is payable in full at the time of lodging a nomination application using information provided in the online nomination application.
Employers must not pass the SAF levy on to the visa applicant.
Who will be affected?
- the SAF Levy will be payable on Temporary Skill Shortage (TSS 482 visa), subclass 186 and 187 nomination applications;
Background:
The Migration Amendment (Skilling Australians Fund) Bill, passed by the Parliament of Australia, was implemented on 12th August 2018. Employer sponsored applications will incur the new training levy from this date.
The bill imposes a nomination training contribution charge (known as the Skilling Australians Fund levy) on employers nominating workers under the temporary and permanent employer sponsored migration programs.
The levy will replace the current training benchmarks for employers sponsoring workers on 457, ENS and RSMS visas from March 2018. It will also be the requirement for the new TSS visa.
For the purpose of the levy, businesses with turnover of less than $10 million per year are considered small business and businesses with turnover of $10 million or more per year are defined as large business:
- size of the sponsoring business and
- proposed period of stay of the overseas worker in Australia.
| Business size | TSS visa | ENS / RSMS and SESR visas |
|---|---|---|
| Small (annual turnover less than $10 million) | AUD 1200 per year or part thereof | AUD 3000 one-off |
| Other business (annual turnover of $10 million or more) | AUD 1800 per year or part thereof | AUD 5000 one-off |
Example: a business with an annual turnover of more than AUD10 million per year that wishes to nominate a TSS worker for a period of 4 years would be liable to pay a levy of AUD7,200 (4 years x AUD1,800).
For SESR nominations, if the nominee already holds a SESR visa the SAF amount is reduced to the following:
| Years remaining on visa | Base amount to be paid as a percentage (%) |
|---|---|
| 4 | 80 |
| 3 | 60 |
| 2 | 40 |
| 1 | 20 |
Levy payments are tax deductible.
Sponsors who are party to a labour agreement must also pay the levy.
Only ministers of religion and religious assistants nominated under the Labour Agreement streams of the TSS or ENS visas are exempt.
For payment options, see how to pay.
Note:
- The nomination application form lets you select only 1 of the radio buttons for a 1, 2, 3 or 4 year nomination period. The levy payment is calculated based on the selected option.
- You must pay the levy when you submit your nomination application. This includes where a nomination application is being lodged to allow a TSS visa holder to change employer or occupation.
- From 18 February 2022, Skilled Regional (Provisional) visas were extended, including SESR, for three years for visa holders affected by COVID-19 international travel restrictions. This extension was made free of additional Visa Application Charges and the SAF Levy.
It is important to note that companies employing someone on a sc457 visa are required to meet their Training Benchmark obligations until 12 August 2018.
REFUNDS OF THE SAF LEVY
Refunds are generally not available for the Levy paid for TSS nominations, however it is possible under the following:
- applications where the employer’s sponsorship (SBS) application is refused
- applications where the employer’s sponsorship is approved, but the employee’s subsequent visa application is refused based on character or health grounds.
- When an approved TSS 482 visa holder does not actually commence work with the sponsor.
- When a TSS 482 visa holder ceases work with their sponsoring employer in the first 12 months of employment. The refund will be calculated based on the balance of the years remaining on the visa.
There will be no refund if the nomination is withdrawn or refused.
The SAF levy may be refunded where a written request has been made by the person who paid the nomination fee and the SAF levy. The fee may also be refunded where the delegate considers it is reasonable in the circumstances to refund the fee without receiving a written request.
Refund due to mistake made by the Department
The nomination fee and the SAF levy may be refunded where the nomination application was made because of a mistake by the Department.
For example, there may be isolated cases where the Department grants a subclass 482 visa for the wrong period of time or with the wrong visa conditions. The Department then requires the sponsor and visa holder to lodge another nomination and visa application to remedy the mistake. The new nomination application would be attributable to the Department’s mistake in this case and the fees would be refunded.
Refund for a party to a labour agreement
The nomination fee and the SAF levy for a pending application in the labour agreement stream may be refunded where nomination application is withdrawn before a decision is made because:
- the nominated occupation is not included in the relevant labour agreement; or
- the number of nominations permitted for the yearly ceiling has been reached.
This accommodates the situation where a sponsor with an approved labour agreement withdraws a nomination before a decision is made because they are in excess of their nomination ceiling, or the nominated occupation is not among the occupations specified in the approved labour agreement.
Refund due to incorrect SAF levy payment
The nomination fee and SAF levy payment for a pending application may be refunded where the nomination application is withdrawn because the information in the nomination used to work out the amount of the SAF levy was incorrect.
It is not possible to amend any information provided in the nomination application once it has been lodged. When incorrect information has been provided in respect to the annual turnover and/or employment period, an incorrect amount of the SAF levy is consequently calculated and paid. Post-lodgement, a sponsor cannot change the period of employment or annual turnover and pay an additional SAF levy or request for a partial refund of the SAF levy. The sponsor would need to withdraw the nomination (before a decision is made on the application), and relodge another nomination with the correct information.
Example: A sponsor indicates an annual turnover of $2 million and a proposed employment period of 2 years. The SAF levy is then calculated as $2400. The sponsor then realises that the proposed employment period should be 4 years and should have paid a $4800 SAF levy. The sponsor must withdraw the nomination and be refunded the nomination fee and the SAF levy in this instance.
Refund due to sponsorship application withdrawn or refused
The nomination fee and SAF levy payment for a pending application may be refunded where the nomination application is withdrawn because the sponsor has withdrawn their application to be approved as a standard business sponsor or their sponsorship application is refused.
Refund due to labour agreement not entered into
The nomination fee and SAF levy for a pending application may be refunded because the person withdraws the nomination application, as their requested labour agreement is not entered into.
This would be applicable where the applicant withdraws the nomination application ahead of a decision being made on the labour agreement, or if the labour agreement negotiations fail and they have answered Yes to the question on the application form regarding withdrawal in this circumstance.
Refund due to visa application being refused on certain grounds
The nomination fee and SAF levy for a finalised nomination application may be refunded because the grant of a TSS visa is refused under s501 of the Act or because the visa applicant did not satisfy public interest criterion 4001, 4002, 4003, 4007 or 4020 (and this application has been finally determined including any merits review processes). Under policy, only the SAF levy payment would be refunded in this scenario.
Refund due to failure to commence employment
The nomination fee and SAF levy payment for a finalised application may be refunded if a TSS visa is granted on the basis of the nomination and the visa holder fails to commence employment as proposed in the nomination. Under policy, only the SAF levy payment would be refunded in this scenario.
This would require that the nominee is actually granted a TSS visa in association with the approved nomination.
Condition 8607 is a mandatory condition on a TSS visa, and subclause (4) requires the TSS visa holder to commence work within 90 days after arrival in Australia (if the holder was outside Australia when the visa was granted) or 90 days after the visa is granted (if the holder was in Australia when the visa was granted). Where appropriate, the visa holder should be referred to Cancellations and the visa should be cancelled, before the refund is considered.
Refund due to cessation of employment
The nomination fee and the SAF levy for an approved nomination may be refunded where the proposed period of stay is greater than 1 year and the nominee ceases to be employed by the sponsor, or an associated entity, within 1 year after commencing employment. Under policy, the Department would generally only refund part of the SAF levy in this scenario because the nomination fee is a fee for service and the service (processing of the nomination) has been provided. The partial refund would be the SAF levy that was paid minus one year.
Example: A sponsor indicates an annual turnover of $2 million and a proposed employment period of 2 years. The SAF levy is then calculated as $2400. The nominee then ceases employment 6 months after commencing employment. The sponsor is then eligible to receive a refund of $1200, which is $2400 (what was paid) minus $1200 (one year’s levy).
Example: A sponsor indicates an annual turnover of $5 million and a proposed employment period of 4 year. The SAF levy is then calculated as $7200. The nominee then ceases employment 8 months after commencing employer. The sponsor is then eligible to receive a refund of $5400, which is $7200 (what was paid) minus $1800 (one year’s levy).
This provision may apply regardless of whether the nominee holds a 457 visa or a TSS visa.
Ineligible SAF refund requests
Refund of the nomination fee and the SAF levy are not available in the following circumstances:
- The nomination application is refused, regardless of the grounds for refusal
- The nomination application is withdrawn because the nominee or sponsor has changed their mind or because the sponsor becomes aware that they would not meet the criteria for approval
- The nomination application is withdrawn because it is a duplicate application
- The nominee has been granted a different type of visa (such as a permanent residency visa) after lodgement of the nomination application, and the sponsor no longer wishes to proceed with the application
