SDL (Skills Development Levy) — South African employer guide
The Skills Development Levy (SDL) is a 1% employer levy on total payroll for employers whose annual payroll exceeds R500,000. It funds SETA training programmes and lets employers claim back Mandatory (20%) and Discretionary Grants.
Payroll Africa Editorial · SARS Payroll Compliance Team
The Payroll Africa editorial team is composed of registered tax practitioners, payroll administrators and BCEA specialists who maintain the SARS PAYE, UIF, SDL and ETI engines that power the platform. Every article is reviewed against the current SARS BRS and Basic Conditions of Employment Act before publication.
- SARS registered tax practitioners
- SAPA-affiliated payroll administrators
- BCEA and LRA compliance reviewers
Last updated 30 Sept 2026
Who pays SDL?
Every employer registered with SARS as an SDL contributor must pay 1% of the total remuneration paid to employees each month. Registration is compulsory once the annual payroll exceeds R500,000.
- Rate: 1% of the leviable amount
- Threshold: R500,000 annual payroll
- Public benefit organisations exempt (Section 30 PBOs)
- National and provincial government exempt
- Employers with only directors also exempt below threshold
SDL and the SETAs
20% of SDL is returned to employers as a Mandatory Grant when the WSP (Workplace Skills Plan) and ATR (Annual Training Report) are submitted to the SETA by 30 April each year. A further Discretionary Grant is available for specific priority programmes.
How Payroll Africa handles SDL
SDL is calculated automatically on every payroll run and included on the monthly EMP201. Once your annual payroll passes R500k, toggle SDL on for the company and Payroll Africa handles the rest.
Frequently asked questions
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