There may be situations where you or your company could benefit from support through statutory payments relating to health and the responsibilities of becoming a new parent. In this section we provide a brief overview of Statutory Sick, Maternity, Statutory shared parental pay and Adoption Payments. Their relevance depends on individual circumstances and full consideration should be made before deciding what is best for you. If you do not have sufficient funds in your business bank account to make the relevant statutory payments, advanced funding can be applied for from HMRC.
Statutory Sick Payments (SSP)
To qualify for SSP there are certain conditions that have to be satisfied. SSP is paid at the same time and in the same way as your director’s fee/wages. A period or illness begins on a Sunday and ends at midnight the following Saturday.
Your minimum level of earnings, referred to as the Average Weekly Earnings (AWE), must have been equal to or above the Lower Earnings Limit (LEL) for NIC of £112.00 for 2016/17 (£112.00 2015/16). The period of incapacity to work (PIW) has to be for 4 days or more, but if you have 2 periods of illness within an 8-week duration then the 2 claims are linked.
If you satisfy the qualifying criteria above, then the SSP starts after a period of 3 days known as either the Qualifying or Waiting Days (QDs or WDs). This is as long as you have not been sick in the previous 8 weeks. SSP payments are paid at a rate of £88.45 per week for up to 28 weeks.
If you have already served your 3 QDs in an earlier linked period then you do not have to serve a further 3 in the second period of sickness.
These figures should be reported on the end of year RTI submission.
SSP payments are paid instead of your directors’ fee/wages but are paid at the same time and in the same way as the directors’ fee/wages would have been.
Statutory Maternity Payments (SMP)
If you are expecting a baby you may be entitled to claim Statutory Maternity Pay and leave.
An employee who is expecting a baby has the right to 26 weeks of 'Ordinary Maternity Leave' and 26 weeks 'Additional Maternity Leave’, one year in total. SMP is paid if you have:
- Worked continuously, full or part-time, for at least 26 weeks up to and into the 15th week before the week the baby's due;
- Average earnings at least equal to the Lower Earnings Limit for NICs - £112 a week if the baby was due from 19th July 2015 onwards;
- Given you the right paperwork confirming the pregnancy and sufficient notice of when they would like the SMP payments to start.
If you satisfy the qualifying criteria above then the SMP can start anytime after the 11th week of the pregnancy. You should also try and give 8 weeks’ notice of your intention to return to work.
The rate of Statutory Maternity Pay (SMP) for 2016/17 ( and is the lower of 90% of your Average Weekly Earnings (AWE)for the first six weeks then the standard rate of £139.58 or 90% of your AWE for the following 33 weeks. Total payments are for a maximum of 39 weeks but you can take up to 52 weeks in leave.
Your company can reclaim 100% of the SMP paid to you plus 3% compensation if the company’s liability to Class 1 NIC is £45000 or less. These figures should be reported on the end of year RTI submission.
Keeping in touch days (KIT)
You are entitled to work for 10 days in your maternity pay period without losing your maternity pay entitlement. When working on these KIT days it does not have to be a full day, it can be for a small number of hours but this still counts as 1 of your 10 KIT days. These days are designed so that you can undertake training or do some occasional work if required to assist your return to work. These days can be worked consecutively, singly or in blocks but if they exceed 10 days then SMP cannot be paid for the extra days worked.
Statutory Shared Parental Pay (ShPP)
- Fron April 2015, statutory paternity leave (SPL) and pay was replaced with shared parental pay and leave. Shared parental pay is available in respect of:
Children with an expected week of birth ending on or after 5th April 2015;
Children placed for adoption on or after 5th April 2015.
SPL is available where both parents are eligible and one partner ends maternity or adoption leave or pay ( or maternity allowance early). The remaining leave will be available as SPL. The remaining weeks of pay will be available as ShPP.
The mother must take a minimum of two weeks’ maternity leave following the birth. Thereafter:
- The rest of the 52 weeks of leave (up to a maximum of 50 weeks) can be taken as SPL.
- The rest of the 39 weeks of pay or maternity allowance ( up to a maximum of 37 weeks ) can be taken as ShPP.
The rate of statutory shared parental pay (ShPP) for 2016/17 is the lower of 90% of your Average Weekly Earnings (AWE) or the standard rate of £139.58. This is the same as SMP except that during the first six weeks , SMP is paid at 90% of earnings.
Your company can reclaim 100% of the ShPP paid to you plus 3% compensation if your annual liability to Class 1 NIC is £45000 or less. These figures should be reported on the end of year RTI submission.
Statutory Adoption Payments (SAP)
If you are adopting a child you may be able entitled to claim Statutory Adoption Pay and Leave for a period that will enable you to take time off work around the time the child is placed with you.
The rate of Statutory Adoption Pay (SAP) for 2016/17 is the lower of 90% of your Average Weekly Earnings (AWE) or the standard rate of £139.58 for a maximum of 39 weeks but you can take up to 52 weeks in leave. If you are not entitled to SAP then we will supply you with a form SAP1. You cannot claim SAP & Statutory Paternity Pay for the same period.
If you qualify for SAP, it can start anytime up to 14 days before the placement or the date of the actual placement takes place. You should also try and give 8 weeks’ notice of your intention to return to work
Your company can reclaim 100% of the SAP paid to you plus 3% compensation if the company’s liability to Class 1 NIC is £45000 or less.