Singapore SDL Skills Development Levy Explained and SDL Payment

1. What is SDL Skills Development Levy?

SDL (Skills Development Levy) is a mandatory levy in Singapore that you must pay for all employees working in Singapore (including foreign employees). This is an additional expense on top of monthly CPF contributions. The CPF Board collects SDL on behalf of SkillsFuture Singapore (SSG). SDL is used to support workforce upgrading. The collected SDL will be allocated to the Skills Development Fund to support workforce upgrading programs and provide training grants when you send employees for training under the national continuing education and training system.

3. How much SDL should be paid (rates)

Singapore companies need to pay 0.25% of each employee's monthly gross wages as levy. The minimum levy payable is $2 for employees earning less than $800 per month, while the maximum levy payable is $11.25 for employees earning more than $4,500 per month. Add up the calculated SDL for each employee, then round the total amount to the nearest SGD dollar - the system will automatically round to whole numbers.

4. SDL Payment Methods:

Pay SDL together with CPF contributions. You can use the SDL calculator to calculate SDL payments for all employees and pay the total SDL due when making CPF contributions. If you use the auto-calculation feature under CPF EZPay, SDL will be automatically calculated for all Singapore citizens and Singapore permanent resident employees. SDL for foreigners will not be automatically calculated - you need to enter the SDL payable for foreign employees in CPF EZPay.

5. How do I make up for missed Skills Development Levy (SDL) payments?

You need to immediately make up the full amount for the period of unpaid or underpaid Skills Development Levy (SDL) in one lump sum. You can add the make-up payment to the SDL payable in your next CPF submission, or pay directly to SkillsFuture Singapore (SSG).

Please note that as an employer responsible for paying SDL, Singapore companies should keep proper payment records as SSG may conduct audits. If you delay SDL payments, you may be required to pay a penalty of 10% per annum on the unpaid amount.

For more details and assistance regarding Singapore company SDL levy, please feel free to contact our customer advisors.