The Skills Development Levy (SDL) is a compulsory levy under the Skills Development Levies Act. It funds skills development in South Africa through the SETAs and the National Skills Fund. Employers pay it, but many treat it as a sunk cost when part of it can be recovered.
Who pays SDL
Employers registered with SARS whose total annual payroll is more than R500,000 must pay SDL at 1% of their total payroll. It is declared and paid monthly with PAYE and UIF on the EMP201 return. SDL is an employer cost and is not deducted from employees' salaries. Where it appears on a payslip, it is shown for information only.
Where the money goes
- Most of the levy is allocated to the employer's SETA
- Part funds the National Skills Fund for national priority skills
- SETAs pay mandatory grants back to compliant employers
- SETAs award discretionary grants for PIVOTAL programmes such as learnerships
How to claim SDL back
- Submit a Workplace Skills Plan (WSP) and Annual Training Report (ATR) to your SETA by the annual 30 April deadline to qualify for the mandatory grant
- Apply in your SETA's discretionary grant window to host funded learnerships
- Claim the Section 12H learnership tax allowance from SARS for registered learnership agreements
- Record skills spend for B-BBEE skills development recognition
Turning the levy into a workforce pipeline
Employers get the most value when they treat SDL as a skills budget. A delivery partner like Usured Academy can run the learnership mechanics, including sourcing, onboarding, facilitation and SETA reporting. The employer then recovers value through grants, tax allowances and a trained talent pool.