If you are an employer in the UK, it is important to be aware of Statutory Maternity Pay (SMP). This article will provide you with everything you need to know about SMP, including what it is, how much employees are entitled to, and how to go about paying it. We will also answer some frequently asked questions from employers.
What is Statutory Maternity Pay?
So, what is SMP? SMP is a government-funded payment that is available to eligible employed mothers who are taking time off work to have a baby. The payments are made for up to 39 weeks, and the amount depends on your employee’s average weekly earnings.
For 2023/24, the standard rate of SMP is:
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- The first 6 weeks: 90% of the employee’s average weekly earnings before tax
- The remaining 33 weeks: £156.66 or 90% of their average weekly earnings (whichever is lower)
Statutory Maternity Pay eligibility
To be eligible for SMP, your employee must have been employed by you for at least 26 weeks up to and including the ‘qualifying week’ (the 15th week before their baby is due). They must also earn on average at least £123 per week. If your employee does not meet these criteria, they may still be eligible for Maternity Allowance.
| What happens if the baby is born early? |
|---|
| If the baby is born early, your employee will still get SMP as long as they have been employed by you for at least 26 weeks by the end of the ‘qualifying week’. |
It is important to note that SMP is a statutory entitlement, which means that employers are required by law to provide it. However, many employers will offer additional maternity pay on top of SMP, so it is worth checking your employee’s contract of employment.
How long does Statutory Maternity Pay last?
SMP is paid for up to 39 weeks, and can start from the day after your employee’s baby is born, or up to 11 weeks before their due date if they are unable to work because of pregnancy-related illness.
| Is Statutory Maternity Pay taxable? |
|---|
| Yes, SMP is subject to income tax and National Insurance contributions. |
Is SMP the same as Maternity Allowance?
No, SMP and Maternity Allowance are two different benefits. SMP is paid by your employer, whereas Maternity Allowance is paid by the government.
Maternity Allowance is available to eligible self-employed women, or employed women who do not meet the criteria for SMP. The standard rate for Maternity Allowance is 90% of pay for 6 weeks, and then either £156.66 per week, or 90% of average weekly earnings (whichever is lower) for 33 weeks – which is the same as SMP.
What’s the difference between SMP and Maternity Leave?
SMP is a payment that your employee receives while they are on maternity leave, whereas maternity leave is the period of time that they are entitled to take off work. Your employee can start their maternity leave up to 11 weeks before their baby is due, and they do not have to give you any notice.
How much do most employers offer on top of SMP?
The majority of employers will offer some form of additional maternity pay, on top of the statutory entitlement. The amount varies depending on the employer, but it is usually a percentage of the employee’s salary.
| Example |
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| An employer may offer 100% of salary for the first 12 weeks, followed by 30% for the remaining period up to 39 weeks. |
Statutory Maternity Pay (SMP) rates 2023/24
How much is Statutory Maternity pay? The SMP rates for 2023/24 is either £156.66 per week or 90% of average weekly earnings (whichever is lower), for a maximum of six weeks.
How does SMP work for fathers? SPP explained
Fathers are entitled to Statutory Paternity Pay (SPP) if they meet certain criteria. This essentially works the same as SMP for the mother. To be eligible, they must be employed by you for at least 26 weeks up to and including the ‘qualifying week’ (the 15th week before their baby is due). They must also earn on average at least £123 per week.
The amount of SPP that fathers are entitled to is 90% of pay for the first 6 weeks, and then 13 weeks at either £156.66 per week or 90% of their average weekly earnings (whichever is lower).
Statutory Maternity Pay and Universal Credit – how does it work?
If you are claiming Universal Credit and Statutory Maternity Pay, the amount of Universal Credit you receive will be reduced by the amount of SMP you get. This is because SMP is considered to be income.
Frequently asked questions
Finally, let’s take a look at some frequently asked questions from employers about SMP.
Statutory Maternity Pay is paid in the same way as your employee’s salary, through their usual payroll system.
The amount of SMP your employee is entitled to depends on their average weekly earnings. You can use an SMP calculator to work out the exact amount.
Yes, you can claim back up to 92% of the SMP payments you make, through the government’s Employer’s Scheme.
Yes, SMP is subject to income tax and National Insurance contributions.
You can’t stop an employee from claiming SMP if they are entitled to it. However, you may be able to reduce the amount they receive if they are also receiving other forms of income, such as Maternity Allowance or Paternity Pay.
If an employee does not return to work after their maternity leave, you may be able to claim back some of the SMP you have paid. This is known as the ‘recovery period’.
No, you cannot get SMP if you are self-employed. However, you may be eligible for maternity allowance or universal credit.
SMP can start as early as 11 weeks before the baby is due. However, it will only be paid from the date that the baby is born.
SMP can be paid for up to 39 weeks. However, it will only be paid for a maximum of 29 weeks if you return to work before the end of your maternity leave.
The SMP rate for 2023/24 is £156.66 per week, or 90% of your average weekly earnings (whichever is lower).
Yes, you may be able to claim Universal Credit or Working Tax Credit to top up your income.
Yes, you may be entitled to SMP if you are an agency worker. However, you will only be entitled to SMP if you have been working for the same employer for at least 26 weeks by the 15th week before your baby is due.
We hope this article has been helpful in providing you with everything you need to know about Statutory Maternity Pay.