WDA letter about Skills Development Levy (SDL) contribution

[jpatokal]

Greetings,

I recently received a rather odd letter from the WDA about the Skills Development Levy, addressed to my company complete with a case number. It states that all employers have to pay SDL, provides details of how it's calculated and paid, says that employers may be required to furnish information on their SDL liability by returning the attached form... and then finishes off with "please ignore this letter if you have confirmed that your SDL is correctly computed and paid". Note total lack of detail on what liability they think I may have, much less why or how much it is.

Now I'm already paying the SDL for all my current employees as part of their CPF contributions, and have always done so for all SG/PRs. However, in the past there may have been EP employees who did not contribute to CPF, so their SDL paperwork might have fallen through the gap.

Has anybody else gotten one of these, and what did you/should I do? Am I supposed to ask them to confirm that my SDL is correctly computed and paid (how, and will they? Knowing Sg bureaucrats, they won't!), proactively admit to a past failing and send my best guess at the owed amount, or just ignore the letter and see what happens?

[sundaymorningstaple]

Hey JP, long time between shout outs from yah!

If you have been paying your SDF levy with your CPF like most do (this can be now paid separately direct to WDA but I don't know why anybody would change from just paying it along with the CPF) and it's being computed correctly, then just disregard the letter (if you pay it with your CPF) just file it. I got the letter for all four of our companies and I use a commercially available Payroll Software that's one of the best in the region.

They could, however, request an audit of your contributions (I did have that happen with my old employer who didn't pay any for 3 years prior to my joining that company-I didn't know it until the audit) It's a pain in the arse pulling out all those payroll records. But I wouldn't worry about it unless it happens. If it does happen, they will normally ask to see your SDL contributions and wages for an arbitrary quarter in a year or two. If they pan out okay, no sweat (kind of like the typical CPF audit). If they don't, then you have a can of worms.

If you didn't pay some of the SDF, you will have to pull the payroll records and recompute month by month and then you will have to pay the difference along with interest. Or, you can wait and see if they audit and then you will have no choice. Did you miss one for the duration or only occasionally?

Forgot one important bit. Do you have EP/S pass holders on your payroll? You also need to pay the SDL on those employees (even though they don't pay CPF). So, if you do, plan on pulling out your payroll records and burning some lamp oil.


sms

[jpatokal]

An overdue followup: I ignored the letter, a year has passed, and I never heard back. So apparently this was just a fishing expection on the WDA's part.

[sundaymorningstaple]

JP, yes it's a fishing expedition but eventually you may well get audited and you could have a big pain in the arse depending on many staff you have/had. When I was working for the recruitment firm 10 years ago, we got audited as my boss never bothered to pay it. I ended up going through payroll records for 5 years and computing the SDF levies of close to a thousand employees some of which only worked several days (not a problem) to those who worked several days across two consecutive months (problem) This also went through 3 different rates of computation over the 5 years. The fact that you got the letter means that they already know you a) havent been paying; or b) paying incorrectly. They may or may not audit but they can and do. You would have to pay the levies, penalties and interest for the total amount. Good luck and great to hear from you again. Thought you fell off the face of the earth!