SA Wages Pro

SDL: The Skills Development Levy

3 min read — Updated September 2026

What Is SDL?

The Skills Development Levy funds training and learnerships in South Africa. It is 1% of what you pay your workers.

The single most important thing to understand: SDL is an employer cost. It comes out of your pocket, on top of wages. It is never deducted from the employee and it never reduces anybody's take-home pay.

Deducting SDL from an employee's wage is unlawful. If you see SDL reducing a net pay figure, something is wrong - contact support.

When It Applies to You

SDL only applies if your total annual payroll is more than R500,000. Below that you are exempt and you do not register or pay.

Most households with one or two domestic workers are well under the threshold. A farm with a dozen seasonal workers may well be over it. SA Wages Pro works out your annualised payroll from the payslips you have run and tells you which side of the line you are on.

On the EMP201, the SDL card either shows the amount payable or says "Below R500k threshold" - that is your answer without doing any sums.

How It Is Calculated

SDL is worked out per employee at 1% of their pay, then all the employees are added together into one employer total. You pay SARS the single total, not a separate amount per worker.

Calculating it per employee is what lets each worker's IRP5 certificate show their share.

Where SDL Appears

SDL shows up in three places:

  • On each payslip, as an employer contribution - shown for transparency, not deducted
  • On the EMP201, as part of the monthly total you pay SARS
  • On the IRP5 certificate, under source code 4142

Registering for SDL

If you cross the R500,000 threshold you must register with SARS for SDL. You will be issued an SDL reference number - the letter L followed by 9 digits - which you capture under Settings → SARS & UIF registration so it appears on your forms.

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