Since SDL is collected by the CPF Board on behalf of the SkillsFuture Singapore Agency (SSG), it is one of the components that have to be included on your monthly CPF Return. More information about the CPF Return and its components can be found in the following article:
SDL amounts must have cents on the individual payslips; however, when the total is reported to the CPF Board each month, the cents will be dropped – meaning that the total will be rounded down to the nearest dollar.
When payments are made to the CPF Board, they should be based on the information contained in the CPF Return. More specifically, SDL amounts that are paid over will have no cents because the cents have been dropped.
On the other hand, if you integrate from SimplePay with an accounting system such as Xero, the SDL amounts posted from the Pay Runs tab will be based on information contained in the payslips, i.e. amounts that do still have cents.
As a result, there could potentially be a mismatch in your accounting system between the amount reflecting as an SDL Liability (with cents) and the amount paid over to the CPF Board to settle this liability (without cents). For this reason, an additional posting from the Filing section might be required to reduce the SDL Liability to zero. The steps to do this are as follows:
Initial Posting of SDL Rounding Amounts
- Go to the Filing section and find the month for which you want to post SDL Rounding amounts.
- If the information in the PDF document is correct, click on Finalise next to the relevant CPF Return (if it has not been finalised yet).
- Once the CPF Return is finalised, you can click on Send SDL Rounding to Xero under the Accounting Info heading.
- Check the information that will be posted to Xero and click on Post.
- Click Confirm.
- You can check the posting in Xero by clicking on View in Xero under Accounting Info.
Please note: by default, SimplePay will post these SDL Rounding amounts to the same Xero accounts – but the opposite sides – that SDL was originally mapped and posted to as part of the Pay Run Account Mappings. However, if you would like to change the mappings for posting the SDL Rounding amounts, you could do so as follows:
- Go to Settings > Accounting System Integration > View / Change Submission Account Mappings.
- You will now be able to confirm and / or change the mappings for the posting of the SDL Rounding amounts.
- Click Save.
Posting SDL Rounding Adjustments
The steps above will be sufficient in most cases. However, it could happen that changes need to be made to payslips after the usual month-end procedures including finalising and posting have been completed.
In cases where a new CPF Return is generated because of changes to payslips, you can follow the steps below to deal with SDL Rounding adjustments that might be required:
- Go to the Filing section and find the month for which you want to post SDL Rounding adjustments.
- If the information in the PDF document is correct, click on Finalise next to the relevant new CPF Return (if it has not been finalised yet).
- Once the new CPF Return is finalised, you can click on Send SDL Rounding adjustment to Xero under the Accounting Info heading.
- Check the information that will be posted to Xero and click on Post.
- Click Confirm.
- You can check the posting in Xero by clicking on View in Xero under Accounting Info.
If the SDL Rounding had been posted before a new CPF Return was generated, the posting of the SDL Rounding adjustments will result in the initial journal being voided in Xero and a new journal being posted, which contains the updated SDL Rounding amounts.
If the SDL Rounding had not been posted before a new CPF Return was generated, the posting of the SDL Rounding adjustments will simply result in the updated SDL Rounding amounts being posted to Xero.
Cutoff Date
By default, the posting of SDL Rounding (adjustments) will be available for all months that you have used SimplePay to do your monthly filing. However, you might have already done manual journals regarding the SDL Rounding for the months before the SimplePay feature became available.
Therefore, in order to avoid duplication, you might want to set a “cutoff” date, which will be the month from when the SDL Rounding (adjustments) could be dealt with on the Filing tab. If you set a cutoff date, it will not be possible to do SDL Rounding (adjustment) posts in the months prior to the cutoff month.
You can set up a cutoff date as follows:
- Go to Settings > Accounting System Integration > View / Change Submission Accounting Cutoff Date.
- From the drop-down menus next to Cutoff Date, you can then select the year and month that you would like to start using the system to do the posting with regards to the SDL rounding differences.