You can also find information from GOV.UK. Howdy, Stranger! Employees don't have to take 52 weeks of Maternity Leave. In the event that they do not complete the 12 months, for any reason, then the company can ask the employee to repay the enhanced element of the maternity pay. (52 weeks) will be required to repay the difference between the enhanced rate of maternity pay that they have received and the minimum level of maternity pay, SMP, to which they would otherwise have been entitled. calculate your maternity leave take-home pay . If you receive statutory maternity pay on a monthly basis until your employment terminates next December, then you will remain an employee during this time. Where this occurs, must they also pay enhanced pay rates during shared parental leave (SPL)? It's true that you will need to recruit or reorganise to cover an employee's maternity leave, but there's less to fear from maternity pay than many realise. To apply for an advance of statutory parental, paternal, adoption or maternity pay, you can use the online service to apply for all types of advance. They may pay more than statutory maternity pay for a fixed period. From: HM Revenue & Customs. Statutory Maternity Pay Add a Statutory Maternity Leave Download a Payment record PDF What is enhanced maternity pay (EMP)? This has the effect of increasing earnings for each payment in the relevant period by 21.62. After the first six weeks, you get a flat rate of 156.66 per week (April 2022 - April 2023) for 33 weeks or 90% of your average earnings if that is less. 17 April 2015. If you take the full 52 weeks' maternity leave, the last 13 weeks are unpaid unless your contract offers enhanced maternity pay. This in turn fosters loyalty to the company and helps retain working parents, and those who are . . Checking eligibility for Shared Parental Pay Enhanced maternity pay If you wish, you can offer enhanced maternity pay arrangements to attract and retain employees. Check the maternity benefits you're entitled to & how much SMP, Enhanced Maternity Pay, Maternity Allowance & Child Benefit you'll get each month after tax. If the employee was only in receipt of basic pay during the eight-week reference . Q: "I work for a company who offer contractual maternity pay. If the maternity enhanced pay was last tax year we would be asked by HR to work out how much NET you have to pay back. Enhanced maternity pay. An employee eligible for the enhanced package has to provide a written commitment that they will return to work for at least 12 months after maternity leave. Read more on statutory pay and leave. tools. This will replace the existing provisions on additional paternity leave (APL) and will apply to babies due on or after 5 April 2015. 1. To work out how much ShPP you're entitled to, you can use the Shared Parental Leave and Pay planning tool on GOV.UK. Part-time workers are entitled to the pro-rata equivalent. An employment contract will set out an employee's holiday entitlement which can be more than the statutory minimum. A 1% pay award is then applied from a date between the start of the relevant period and the end of the employee's MPP. In order for an employee to qualify for SMP, they must earn on average at least 118 a week, give correct notice, provide proof of pregnancy (if you need it) and have worked for you continuously for at least 26 weeks continuing into the 'qualifying week' - the 15th week before the expected week of childbirth. The Alabaster Rule. Qualifying rules Entitlement For example, you could: pay more than SMP over a certain period, e.g. Enhanced Maternity Pay or Maternity Allowance Monthly net amount after deductions The SMP Rates for 2020-2021 are: First six weeks: 90% of your average weekly earnings The next 33 weeks: 151.20 per week or 90% of your average weekly earnings (whichever is less) Eligibility All pregnant employees, regardless of length of service, are entitled to 52 weeks' maternity leave, consisting of 26. Sign in or register to get started. Your expected week of childbirth is the week of your estimated due date. Maternity Allowance is a payment you can get when you take time off to have a baby. Statutory maternity pay (SMP) You can easily process statutory maternity pay (SMP) by using Payroll to automatically calculate it for you. check if you're eligible for maternity leave & pay. If your business does not offer enhanced maternity pay, it must pay Statutory Maternity Pay (SMP). For example, you might get 26 weeks of full pay followed by 13 weeks of SMP. Enhanced maternity pay and shared parental pay Some employers give their employees enhanced rates of maternity pay for part or all of their maternity leave period. For employees: Maternity pay and leave. Statutory maternity pay is: 90% of your average weekly earnings (before tax) for the first 6 weeks *156.66 or 90% of your average weekly earnings (whichever is lower) for the next 33 weeks https://www.gov.uk/maternity-pay-leave/pay Statutory paternity pay is the same 156.66/90% rate as the mother gets after the first 6 weeks. The new regime will allow parents to share the statutory maternity leave and pay currently only available to mothers. During the next 33 weeks of maternity leave Pay whichever of these is lower: 156.66 90% of their average weekly earnings (before tax) You can also receive childcare vouchers as a salary . Maternity Leave and Pay: Policy 3 4.3 Statutory Maternity Pay 4.3.1 Statutory Maternity Pay Statutory Maternity Pay is paid to employees alongside University Maternity Pay for a period of 39 weeks as follows: Weeks 1 to 6 The higher of the current flat rate or 90% of average weekly earnings. Enhanced paternity pay Statutory maternity pay disputes are ultimately resolved by HMRC's Statutory Payment Dispute Team, but it is recommended that you try to resolve the issue with your employer first," he explains. The effect on SMP. It cannot be less than SMP. Find forms and guidance for Maternity, Paternity and Shared Parental Leave and pay. Employers offering enhanced contractual maternity pay to mothers are not guilty of direct or indirect discrimination or of breaching equal pay rules, if they fail to give enhanced pay to fathers taking . They may pay full pay for the first six weeks, half pay for the following 10 weeks and maternity pay for the remaining 23 weeks. Your average pay is based on your earnings when you are approximately 18 to 26 weeks' pregnant. Statutory Maternity Pay is payable for up to 39 weeks. If an employer applies a pay increase (this includes NMW uplifts) during the 'alabaster window', then the 6 weeks of maternity pay at 90% of average weekly earnings (AWE) needs to be recalculated and the difference paid to the employee. Published. Your employer pays your SMP in the same way as your salary is paid. The government will repay 92% of statutory maternity pay and 103% if your business qualifies for Small Employers Relief. The only benefits that can be provided tax efficiently via salary sacrifice arrangements are: Regulation 9 of the Maternity and Parental Leave Regulations 1999 (the Regulations) provides that during ordinary maternity leave and additional maternity leave, an employee is entitled to all the usual benefits of her employment, except her remuneration, which is replaced by statutory maternity pay (SMP), or contractual maternity pay. Should you need to discuss your case with HMRC, you can contact its Payment Dispute Team on 0300 322 9422. Offer enhanced Shared Parental Pay at the same level as enhanced maternity pay; Encourage take up of Shared Parental Leave (see our Shared Parental Leave guidance (opens in a new window)). You must pay eligible employees the lower of: the standard weekly rate - 156.66 90 per cent of their average weekly earnings You can recover some or all of your SPP payments from HM Revenue & Customs (HMRC) - the proportion you can recover depends on the size of your annual NICs liability. It looks like you're new here. We've gathered together everything you need to help you understand the qualifying rules and entitlement, as well as how to record it. Overview. Enhanced Maternity Pay is offered by almost two thirds of UK Organisations. Alternatively, 45.9% of businesses offered financial benefits to those returning from maternity leave, such as a bonus. The most common option for employers is to offer full pay for the first six weeks or more when the employee takes maternity leave, instead of 90% of their average weekly earnings (before tax) for the first six weeks. This policy applies to all employees and is non-contractual. full pay for the first six weeks, half pay for the next ten weeks, SMP for the remaining 23 weeks make a bonus payment on the employee's return to wor Once the money is paid back we would then have to complete balance adjustments and report to HMRC. SPM200100 - Change in circumstances - Keeping in Touch (KIT) days Employees can work for up to 10 KIT days during the maternity/adoption and additional paternity pay period (MPP/APP) without it. MA is a weekly payment that you may be able to get if you have been employed or self-employed for some of the time during and before you became pregnant and your earnings for part of that time were. ShPP will be paid at the same rate as Statutory Maternity Pay, which currently stands at 151.97 from 4th April 2021, increasing to 156.66 from 11th April 2022 This does not affect eligibility for Statutory Maternity Leave , adoption leave, ordinary paternity leave (two weeks for fathers/partners), or ordinary unpaid parental leave (18 weeks). You may be able to keep receiving childcare vouchers whilst you are on maternity leave, if a deduction can be made by way of salary sacrifice from any enhanced maternity pay you receive, over and above the statutory amount or from any payment you receive for 'Keeping in touch' days. Pay and reward Childcare Over half of UK employers now provide enhanced maternity and paternity pay Published: 24 May 2021 Nearly two thirds (63.5%) of businesses offer maternity pay above the statuary minimum in the UK, and three-fifths (60.8%) offer enhanced paternity pay. In terms of the amount both you and your employer contribute during maternity leave, your employer should pay the amount that you were receiving before you went on maternity leave. As per Paul's helpful link, the amount that can be claimed can be either 92% or 103% of the SMP value - depending on the Class 1 NICs paid by the employer in the last complete tax year. Some employers voluntarily pay their employees enhanced rates of maternity pay under the terms of the employment contract. Paid maternity or paternity leave signals a flexible attitude to the challenges of life outside of work, and has shown to boost a parent's feeling of goodwill towards their employer, particularly if pay is enhanced during parental leave time. Shared Parental Leave and Pay enables working parents to share up to 50 weeks of leave and up to 37 weeks of pay in their child's first year. Those who fail to return at the end of their maternity leave period. You can get Maternity Allowance for up to 39 weeks. An optional remuneration regime was introduced in 2017 which restricts the benefits that attract tax and NICs advantages when provided as part of an optional remuneration (including salary sacrifice) arrangement. If they earn 120 on average per week or more in the tax year, they are eligible for statutory maternity pay. nhs maternity pay . With the increase in pay due to the rise in the National Minimum Wage and the National Living Wage on the 1 st April 2018, there are instances where the principles of the Alabaster case may needed to have been applied. Returns, forms & HMRC admin . The next 33 weeks: 145.18 per week, or 90% of your employee's average weekly earnings (whichever is lower) Use Croner's free maternity pay calculator to work out SMP for you or your staff. Check if you can . The new system will also apply to adoptions where the adoption matching or placement date is on . During the first 6 weeks of maternity leave Pay them 90% of their average weekly earnings (before tax). Some employers offer enhanced ('contractual') maternity pay that's more than SMP. As of 14 September 2016 the following paragraph has been removed from the Employer Handbook "E18: how can you help your employees with childcare": "Childcare vouchers are an employer provided non . Statutory rates Statutory maternity pay (SMP) is paid for up to 39 weeks. The consequence of this is that the company does not have to pay your statutory redundancy payment until your employment then terminates i.e. This minimum 5.6 week entitlement amounts to 28 days. You can claim Maternity Allowance as soon as you . For those who are unaware, The Alabaster Case was heard over a period of nine years . potentially December 2010. Alternatively, after the first six weeks, they may make a weekly payment which exceeds the statutory . Public/bank holidays can be included in or excluded from this statutory entitlement - as decided by an employer. Enhanced maternity pay policies tend to fall into two categories: Type 1: those which calculate enhanced maternity pay in the same way as SMP (by assessing the employee's average earnings prior to the start of maternity leave) and pay the employee a percentage of those average earnings for [x] weeks/months during maternity leave; and. Posted 17th May 2018. HMRC change regarding Childcare Vouchers during Statutory Maternity Leave HMRC have recently revised their guidance regarding the payment of Childcare Vouchers during Statutory Maternity Leave. There are three main forms that the EMP takes: 156.66 90 per cent of their AWE You can recover some or all of your SMP payments from HMRC - the proportion you can recover depends on the size of your annual NICs liability. The best way to determine staff AWE is to take all earnings paid in the relevant period and divide the earnings by the number of weeks in that period.
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