In the UK, the responsibility for paying maternity pay typically falls on the employer.
Statutory Maternity Pay (SMP):
- Employer's Responsibility: Employers are required to pay SMP to eligible employees.
- Eligibility: To qualify for SMP, an employee must have been continuously employed by the same employer for at least 26 weeks up to the 15th week before the expected week of childbirth and must earn at least £123 per week (as of the current threshold).
- Rate and Duration: SMP is paid for up to 39 weeks. For the first 6 weeks, it is paid at 90% of the employee's average weekly earnings. For the remaining 33 weeks, it is paid at the lower of either £184.03 per week or 90% of the employee's average weekly earnings.
Reimbursement by HMRC:
- Small Employers' Relief: Employers who qualify as small employers can reclaim 103% of the SMP they pay from HMRC. An employer qualifies as a small employer if they paid £45,000 or less in Class 1 National Insurance contributions in the previous tax year.
- Standard Reimbursement: Employers who do not qualify as small employers can reclaim 92% of the SMP they pay from HMRC.
- Recovery Process: Employers reclaim SMP through their usual PAYE process by deducting the amount from their monthly payments to HMRC
Before paying SMP, you must obtain proof of pregnancy, typically a doctor's letter or a maternity certificate (MATB1 certificate). Midwives and doctors usually issue these certificates around 20 weeks before the due date.
The employee should provide proof within 21 days of the SMP start date, although you may agree to accept it later if desired. If proof of the due date is not received within 13 weeks after the SMP start date, you are not obligated to pay SMP.