The Soil Water Assessment Tool (SWAT) is employed throughout the world to simulate watershed processes. A limitation of this model is that locations of saturation excess overland flow in hilly and mountainous regions with an impermeable layer at shallow depth cannot be simulated realistically. The objective of this research is to overcome this limitation with minor changes in the original SWAT code. The new approach is called SWAT-with-impervious-layers (SWAT-wil). Adaptations consisted of redefining the hillslope length, restricting downward percolation from the root zone, and redefining hydrologic response units (HRUs) such that they are associated with the landscape position. Finally, input parameters were chosen such that overland flow from variable saturated areas (VSAs) corresponds to the variable source interpretation of the Soil Conservation Service (SCS) curve number runoff equation. We tested the model for the Town Brook watershed in the Catskill Mountains. The results showed that the discharge calculated with SWAT-wil agreed with observed outflow and results simulated with the original SWAT and SWAT-hillslope (SWAT-HS) models that had a surface aquifer that transferred water between groups of HRUs. The locations of the periodically saturated runoff areas were predicted by SWAT-wil at the right locations. Current users can utilize the SWAT-wil approach for catchments where VSA hydrology predominates.