Organising your finances can be overwhelming enough with having to factor in your maternity pay. It can feel like such a tedious job researching all the ins and out of Statutory Maternity Pay too, so we've gathered all the important information to make you a complete guide to maternity pay.
Believe it or not, what you are entitled to as a mum today is a lot better than it's ever been.
From knowing what you're actually entitled to and when your Maternity Leave starts, to everything that your partner needs to know too, it's important to know exactly what to expect so that you can budget your maternity pay and just enjoy your maternity leave and new life with your baby.
What is Statutory Maternity Pay?
Statutory Maternity Pay (also known as SMP) is paid to you for up to 39 weeks. You’re entitled to 90 per cent of your average weekly pre-tax earnings for the first six weeks.
After those six weeks you'll receive either £172.48 or 90% of your average weekly earnings – whichever is the lower amount – for the following 33 weeks.
It's also important to know that you will have pay-as-you-earn (PAYE) tax and National Insurance deducted from your SMP as it counts as earnings. However, some of this may be claimed back at the end of the tax year, depending on your total earnings for the year.
Usually, maternity pay is not paid before the 11th week prior to your birth due date if you’re still pregnant. But if your baby is born early, you’ll still get your Statutory Maternity Pay dated from the day after the birth.
You will also receive it if you’ve finished work because of a pregnancy-related illness in the four weeks before your due date.
For more information, check the Gov.uk website.
Do I qualify for maternity pay?
In order to qualify for Statutory Maternity Leave, you must:
• Give your employer at least 15 weeks notice before your due date
• Earn on average at least £123 a week
• Have been working for your company for at least 26 weeks, ending with the 15th week before your due date.
• Provide a MATB1 form for proof of pregnancy to your employer.
If you've been on furlough during the Coronavirus pandemic, you should still be eligible for SMP.
How is Statutory Maternity Pay Calculated?
If you are paid weekly, maternity pay is calculated on your average weekly earnings in the last payday before your qualifying week, and the previous seven paydays.
Basing the calculation on monthly pay, it is based on your average weekly earnings in the two months before the end of your qualifying week. This is so the calculation can include any overtime, commission, bonuses or anything else paid during this period.
However, if your earnings happen to be lower than usual during the calculation period, unfortunately, the rules are very strict and your employer can’t do anything to change this.
You can check what your maternity pay eligibility is on the Government website.
Your company and Statutory Maternity Pay
Your employer cannot pay you less than the statutory allowance, so it's worth checking your contract to see what your company offers. They may pay more than the allowance!
It's also important to check the fine print of your contract to see if it states you having to repay anything if you don't go back to work. It's worth noting that you would only have to pay back the extra money that your company give you, and not the percentage of your statutory maternity pay payments.
Some employers also offer Contractual Maternity Pay, which will be mentioned in your companies maternity policy. They can also offer Maternity Allowance if you can't get statutory maternity pay from your employer.
Some employers – especially small businesses – can struggle to find the funds to pay for maternity leave. If this is the case, then your boss will need to apply to the HMRC Accounts Office for advance funding.
If your company goes into liquidation, you can approach the HMRC Statutory Payments Disputes yourself to claim your statutory maternity pay.
You can find out more at Citizens Advice.
What if I lose my baby?
You will probably need support following a miscarriage or loss, but you can still claim Statutory Maternity Pay or Maternity Allowance if your baby is born early, is stillborn after the 24th week of pregnancy or passes away after being born.
Incorrect Statutory Maternity Pay?
If you feel you’re not receiving the right amount of money, or are having difficulties with your employer regarding this, then the first step is to write to your employer and make a formal complaint.
If this doesn’t resolve the issue, then you need to approach your local HMRC office so they can make a formal judgement on it. You have to make this application within six months.
Your employer can be fined if HMRC decides in your favour. You can also approach an employment tribunal for unlawful deduction of wages if your company does not pay all or part of your Statutory Maternity Pay, however this claim must be made within three months.
Can my partner take leave?
Your partner will also be able to take time off work, but will only be able to take one or two weeks Paternity Leave.
The statutory rate for Paternity Pay according to the GOV.UK website is £172.48, or 90% of your average weekly earnings and must meet the same requirements to qualify as maternity leave.
What is shared parental leave?
You are entitled to 52 weeks of Statutory Maternity Leave, but will only be paid for 39 weeks in total.
While you must take at least two weeks maternity leave, you can share up to 50 weeks of leave and up to 37 weeks of pay with your partner, known as Shared Parental Leave.
Samantha Ball is a Product & Lifestyle Writer for Mother&Baby and freelanced for the website for two years before joining the team full time. She's a mum of two and loves browsing for the best products and cute outfits.