Government Grants

DCSA offers consulting services on a wide range of Government grants and incentives. We emphasise that the details of individual grant programmes are unimportant and that companies rather focus on their 2-3 year investment plans. We’ll do the hard work upfront and advise our clients of their best options.

The key to our success is our intimate knowledge of each programme, and the Government departments/officials involved with each. This knowledge and experience enables us to map your circumstances to each incentive, and recommend which programme/s is a good fit with your investment plans. As a result, your application’s chances of approval is improved substantially.

Without exception, applications for any of these grants must be submitted prior to commencing production or utilisation of the asset resulting from the spend. Application submission dates vary from 60 days prior to commencement, and in some cases before any financial commitments are made.

If you are currently undertaking investments it may not be too late to secure a grant; contact us to see which sectors qualify for Grants and Incentives and we’ll advise you accordingly.

There are currently more than thirty Government grant programmes – below are some of the more relevant incentives applicable to various industry sectors.
Note – Excepting Tax Allowances, all grants are tax free.

A radical departure from similar Government incentive programmes that focuses on fostering world class manufacturing industry in South Africa, while rewarding job creation.

Sectors– Manufacturing (Including Mining Mineral Beneficiation)
Requirements– Covers expansion investment in productive capacity, and expenditure on green technology and/or competitiveness enhancement initiatives.
Benefits– The value of the grant is calculated on the planned spend, taking Manufacturing Value Add (MVA) and company size into account. As a result, the value of the grant will be different for each company. The grant is payable on achievement of specified milestones.

Until it’s sudden suspension on 20th September 2013, the MIP was one of the most popular schemes, designed to create jobs and enhance the sustainability of manufacturing investments.

Sectors– Manufacturing (Including Mining Mineral Beneficiation)
Requirements– Geared to new investments or expansions in productive capacity.
Benefits– A cash grant starting of between 15% and 30%, calculated on investment in manufacturing capacity, payable over 2-3 years.

Aimed at light motor vehicle manufacturers, people carrier manufacturers and OEM automotive component manufacturers. This programme is designed to grow and develop South Africa’s automotive sector. It is one component of the Automotive Production and Development Programme (APDP).

Sectors– Motor Industry
Requirements– Investments to increase production volumes, employment sustainability/growth and/or strengthening the automotive value chain.
Benefits– A grant of 20% of the value of the qualifying investment in productive assets, with an additional 5-10% for strategic projects.

Designed for projects aimed at building the infrastructure needed to establish large-scale industries or mining operations. For example, a project to build a public road leading to a new mine boundary or establishing on-site utilities.

Sectors– Manufacturing, Mining, Property Development and others.
Requirements– Investment in infrastructure that directly supports the needs of the back-end manufacturing or mining investment. Projects should also be generally beneficial to the local community.
Benefits– a 10%-30% reimbursement of the total infrastructure development cost, payable on achievement of specified milestones.

An incentive programme with the goal of stimulating and growing the aquaculture industry in South Africa, in both the marine and freshwater sectors.

Sectors– Acqualculture
Requirements– Open to any new or expanding company that performs primary, secondary or ancillary aquaculture activities.
Benefits– A reimbursable cost sharing grant on machinery and equipment.

Geared towards attracting large scale foreign investments in greenfield South African manufacturing projects (sizeable brownfield projects also considered). Government is relying on this tax incentive to indirectly alleviate unemployment and recoup investments in Industrial Development Zones (IDZ’s).

Sectors– Manufacturing (Including Mining Mineral Beneficiation)
Requirements– Minimum R200 million investment (R30 million for brownfield) projects involving: innovative processes, energy efficiency, business linkages, SMME procurement, direct employment and skills development.
Benefits– Additional tax allowances of up to 100% of investment, claimable on commencement of production.

Provides funding assistance to the clothing, textile, footwear, leather and leather goods sectors – aiming to create sustainable capabilities and employment in the industry and enable SA to compete with other low-cost production countries. PI forms one component of the Clothing & Textile Competitiveness Improvement Programme (CTCP).

Sectors– Clothing, Textiles, Footwear, Leather
Requirements– Investment in upgrading processes, products and/or people to increase international competitiveness.
Benefits– An annual grant of 7.5% on MVA (Manufacturing Value Add).

This incentive provides funding for business incubators that provide support to entrepreneurs with small, micro and medium enterprises (SMME’s), typically supplier development, enterprise development, skills transfer and marketing opportunities. The idea is assist SME’s to become sustainable enterprises.

Sectors– Incubation not limited to specific sectors
Requirements– Investment in a new or expanded incubator facilities
Benefits– Between 40%-50% cost sharing support for facility investment and annual operating costs

Qualification for this allowance is largely based the definitions in the Frascati Manual. Although interpretation can be challenging for those unfamiliar with it.

Sectors– S11D is not limited to specific sectors
Requirements– Expenditure must be allowable under the SARS issued interpretation note no.50 on R&D Expenditure.
Benefits– S11D provides for an additional 50% tax allowance on approved R&D expenditure from taxable income, an effective 14% tax saving.

A long-term loan from the IDC, forming part of a R25 billion five-year initiative to promote green economic development. The fund is open to any business sector.

Sectors– Not limited to specific sectors but aimed at large consumers of fuel and power
Requirements– Environmentally focused projects with the goal of reducing power consumption levels by a minimum of 20%, through reduced waste and minimising fossil fuel use or self-generated power.
Benefits– Loans of up to R50 million for qualifying projects at favourable interest rates and repayment terms.

This grants’ emphasis is on low-cost sustainable job creation. Focus areas include: enterprise development, infrastructure development, job seeker support and institutional capacity building.

Sectors– Not limited to specific sectors but aimed at low-cost, large-scale sustainable job creation
Requirements– Projects that create a large number of low-cost sustainable jobs in innovative ways. Applicants must demonstrate “Additionality”, i.e., that the predefined project would be unfeasible without the JF.
Benefits– A once-off cost sharing grant of up to 70%.

The Industrial Development Corporation (IDC) offers non sector-specific finance at favourable interest rates and repayment terms on almost all projects that qualify for one or more of the above Government grants. Loan size and repayment terms are entirely dependent on the nature and scope of projects that meet the IDC’s stringent commercials due diligence procedures.

Note: You may qualify for other incentive programmes not mentioned here. Fill out our free assessment to see what government incentives you’re eligible for.