Statute Details
- Title: Skills Development Levy (Wages — Excluded Payments) Notification 2023
- Act/Instrument Code: SDLA1979-S375-2023 (SL 375/2023)
- Type: Subsidiary legislation / Notification (sl)
- Authorising Act: Skills Development Levy Act 1979
- Enacting authority: Minister for Education
- Date made: 12 June 2023
- Commencement: 15 June 2023
- Status: Current version as at 27 Mar 2026
- Key provisions: Section 1 (citation and commencement); Section 2 (definitions); Section 3 (payments excluded from “wages”)
What Is This Legislation About?
The Skills Development Levy (Wages — Excluded Payments) Notification 2023 is a targeted administrative instrument under the Skills Development Levy Act 1979 (“SDLA”). In plain language, it clarifies that certain reimbursements paid by an employer to an employee for specified healthcare-related treatments are not treated as “wages” for the purpose of calculating the Skills Development Levy (“SDL”).
SDL is a mandatory levy imposed on employers based on the “wages” paid to employees. Because the levy base is tied to how “wages” is defined in the SDLA, the Notification matters: it reduces the portion of employer payments that count towards SDL when those payments fall within the Notification’s exclusion.
The Notification operates by using the Minister’s power conferred by the SDLA’s definition of “wages”. Rather than changing the SDLA itself, it specifies a category of payments that are excluded from the statutory meaning of “wages” where the payments become due on or after 15 June 2023.
What Are the Key Provisions?
1. Citation and commencement (Section 1)
Section 1 provides the short title and states that the Notification comes into operation on 15 June 2023. This commencement date is crucial because the exclusion in Section 3 applies only to payments that become due on or after that date.
2. Definitions (Section 2)
Section 2 is the interpretive backbone of the Notification. It defines the healthcare concepts that determine whether a reimbursement qualifies for exclusion from “wages”. The Notification introduces several defined terms:
(a) “Dental treatment”
“Dental treatment” covers procedures, work, services, investigations, treatment/advice, and attendance that a dentist considers necessary for treating or diagnosing a dental ailment, infirmity or defect—excluding solely aesthetic defects. It also includes what is usually provided by dentists for maintaining dental hygiene.
(b) “Medical treatment”
“Medical treatment” similarly covers procedures, work, services, investigations, treatment/advice, and attendance that a medical practitioner considers necessary for treating or diagnosing a physical or mental ailment, infirmity or defect—again excluding solely aesthetic defects.
(c) “Traditional Chinese medicine treatment”
This term covers analogous activities (procedures, work, services, investigations, treatment/advice, attendance) that a practitioner of traditional Chinese medicine considers necessary for treating or diagnosing a physical ailment, infirmity or defect, excluding solely aesthetic defects. The Notification therefore recognises both Western medical practice and traditional Chinese medicine practice.
(d) “Relevant treatment”
“Relevant treatment” is defined broadly to include any dental treatment, medical treatment, or traditional Chinese medicine treatment, whether provided in Singapore or elsewhere.
(e) “Dependant”
The Notification defines “dependant” in relation to an employee to include: (i) a natural child or stepchild; (ii) a child whose adoption, guardianship or foster care by the employee is recognised by law or by a consular authority of the employee’s place of nationality; and (iii) a spouse under a marriage recognised by the law of the country/territory/state where the marriage took place.
(f) Who counts as the treating practitioner (Section 2(2))
Section 2(2) ensures the exclusion is limited to treatment provided by properly qualified practitioners. For relevant treatment in Singapore, the practitioner must be registered under the relevant Singapore regulatory regime: a registered dentist (Dental Registration Act 1999), a registered medical practitioner (Medical Registration Act 1997), or a registered person under the Traditional Chinese Medicine Practitioners Act 2000. For relevant treatment outside Singapore, the practitioner must be qualified to practise under the law of the place where the treatment is provided.
3. Payments excluded from wages (Section 3)
This is the operative provision. Section 3 states that the SDLA definition of “wages” does not include any payment that becomes due on or after 15 June 2023 to an employee from the employee’s employer, to reimburse the employee for amounts incurred in respect of relevant treatment received (or to be received) by the employee or by an individual who is a dependant of the employee at the time the payment becomes due.
Several practical elements are embedded in this exclusion:
- Timing: the payment must “become due” on or after 15 June 2023. This wording focuses on when the employer’s obligation to pay crystallises, not merely when the reimbursement is processed or paid.
- Nature of payment: it must be a reimbursement of amounts incurred (or to be incurred) for relevant treatment.
- Scope of treatment: only dental treatment, medical treatment, or traditional Chinese medicine treatment qualify, and only where the practitioner and treatment meet the defined criteria.
- Recipient of treatment: the treatment may be received by the employee or by a dependant (as defined).
Notably, the exclusion is not framed as a general exemption for all employee benefits or all healthcare-related payments. It is deliberately confined to reimbursements for “relevant treatment” as defined, and it is tied to the “wages” concept for SDL purposes.
How Is This Legislation Structured?
The Notification is structured as a short instrument with three main provisions:
- Section 1: sets out the citation and commencement date (15 June 2023).
- Section 2: provides definitions for the key terms used in the exclusion, including dental treatment, medical treatment, traditional Chinese medicine treatment, relevant treatment, dependant, and the qualification requirements for practitioners (including cross-border treatment).
- Section 3: states the exclusion from “wages” for SDL purposes—specifically, reimbursements for relevant treatment incurred (or to be incurred) by the employee or dependants, where the payment becomes due on or after 15 June 2023.
Who Does This Legislation Apply To?
In practical terms, the Notification applies to employers that are subject to the Skills Development Levy regime under the Skills Development Levy Act 1979. It affects how employers calculate SDL by determining whether certain employer payments are included in or excluded from the SDL “wages” base.
It also indirectly affects employees and their dependants because the exclusion is triggered by reimbursements made to employees for relevant treatment received by the employee or a dependant. However, the Notification does not create a direct entitlement for employees; rather, it shapes the employer’s SDL reporting and computation obligations.
Why Is This Legislation Important?
This Notification is important because it provides a clear, administrable boundary between (i) employer payments that form part of “wages” for SDL purposes and (ii) certain reimbursements that do not. For employers, the exclusion can reduce SDL exposure and improve compliance certainty when structuring employee benefits and reimbursement schemes.
From a practitioner’s perspective, the Notification’s value lies in its precision. It defines the types of treatment and the categories of practitioners, including cross-border treatment. It also defines “dependant” in a way that is legally grounded (including adoption/guardianship/foster care recognised by law or consular authority, and spouses whose marriages are recognised by the law of the place where the marriage took place). This reduces ambiguity when employers reimburse claims relating to family members.
Enforcement and audit risk typically concentrates on whether payments were properly classified. Because Section 3 is limited to reimbursements for “relevant treatment” and is tied to the “becomes due” date, employers should ensure that their payroll and benefits administration systems can evidence: (a) the nature of the treatment; (b) the qualification status of the treating practitioner (or the applicable foreign qualification); (c) the dependant relationship; and (d) the timing of when the reimbursement obligation became due.
Related Legislation
- Skills Development Levy Act 1979
- Dental Registration Act 1999 (definition of “registered dentist”)
- Medical Registration Act 1997 (definition of “registered medical practitioner”)
- Traditional Chinese Medicine Practitioners Act 2000 (definition of “registered person”)
Source Documents
This article provides an overview of the Skills Development Levy (Wages — Excluded Payments) Notification 2023 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.