SPM10915 - Statutory Sick Pay (SSP) - Recovery
Does an employer qualify for PTS
An employer can recover any SSP paid over and above the set
percentage (13% for 2009/10 tax year) of their total,
employers’ and employees’ gross Class 1 NIC liability
for that tax month. Only SSP actually paid may be recovered.
Class 1A NICs paid on benefits such as company cars and
Class 1B NICs paid on PAYE tax Settlement Agreements are excluded
from the calculation,
If the employer pays contracted-out (c/o) rate NICs, they
must use the net figure.
Up to 2006/2007 tax year employers had to deduct the c/o
rebate for that month when calculating their NICs liability. The
employer may have chosen to claim the rebate every few months, in
which case they need to work out the portion of the rebate which
was due for the month in question when working out whether they
were entitled to recover under PTS.
An employer’s Class 1 NICs liability for a tax month
is based on the payments of remuneration made in that month as set
out in the SSCBA 1992.
The SSP payments are the amounts actually paid to the
employees during the tax month, not the SSP due for days of
incapacity.
In order to qualify for recovery under PTS the employer must
pay the SSP payments within set times. See
SPM10910.
To work out if an employer is entitled to recover any SSP
payments:
- work out their total, employers’ and employees’, Class 1 NI liability for the tax month, excluding Class 1A paid on benefits such as company cars and Class 1B paid on PAYE Tax Settlement Agreements
- multiply the gross Class 1 NICs liability by a set percentage given in the E14 Employer Helpbook for that tax year. Note: fractions of a penny are rounded down, and
- calculate their total SSP payments in that month.
If the amount of SSP paid is more than the set percentage of their NICs liability, they can recover the difference between the two amounts.
