In this section:
- Statutory Sick Pay: an overview
- Calculating and recovering Statutory Sick Pay
- Statutory Maternity Pay: an overview
- Calculating and recovering Statutory Maternity Pay
- Statutory Paternity Pay: an overview
- Calculating and recovering Statutory Paternity Pay
- Statutory Adoption Pay: an overview
- Calculating and recovering Statutory Adoption Pay
Calculating and recovering Statutory Adoption Pay
You may be able to recover some or all of the SAP you pay. How much you can recover depends on the amount of Class 1 National Insurance contributions (NICs) you pay a year.
You may be able to recover some or all of the SAP you pay. How much you can recover depends on the amount of Class 1 National Insurance contributions (NICs) you pay a year.
Your payroll software may work out your SAP payments and how much you can recover. Or you can use the SAP calculator on HMRC's Employer CD-ROM and website.
You can also work out SAP manually using the SAP tables, but using payroll software or HMRC's SAP calculator saves time and helps avoid mistakes.
On this page:
- Information you'll need to work out SAP
- Calculating and recovering SAP using an HMRC calculator
- Calculating SAP manually
- Calculating SAP recovery manually
- Advance funding for SAP
- SAP and salary sacrifice schemes
- Help and advice
Information you'll need to work out SAP
Whichever method you use to work out SAP and recovery of SAP you’ll need to gather together the same information.
Information needed to calculate SAP
Before you can start to calculate your employee’s SAP, you’ll need:
- a copy of the matching certificate - or in the case of an adoption from abroad, a copy of the Official Notification from the relevant UK authority that they’ve agreed that your employee is suitable to adopt a child from overseas
- the date the child’s expected to be placed with your employee or to enter the UK
- your employee's gross pay and the dates it was paid in the ‘set period’ (for a definition please read E16, ‘Employer Helpbook for Statutory Adoption Pay’ – link below)
- the date your employee started working for you
- confirmation that your employee's gross earnings are liable to employers’ Class 1 NICs
Check a definition of ‘set period’ in E16, ‘Employer Helpbook for Statutory Adoption Pay’
Information needed to work out what you can recover
To work out how much of the SAP payments you can recover you’ll need to know:
- the amount of SAP you’re liable to pay - this is worked out automatically if you use HMRC's SAP calculator or commercial software that has its own SAP calculator
- how much your Class 1 NICs (employer’s and employees’) were for the ‘relevant tax year’ - you can get this figure from your Employer Annual Return form P35
The later section ‘Calculating SAP recovery manually’ explains how to decide which is the ‘relevant tax year’ for working out the total NICs you pay in a year.
Calculating and recovering SAP using an HMRC calculator
HMRC’s SAP calculator works out how much SAP you’ll have to pay and how much you can recover. It’s easy to use and does everything for you. You’ll find it:
- on the Employer CD-ROM
- on HMRC's website
Both the CD-ROM and the online version of the calculator work in the same way. They’ll work out for you:
- whether your employee is entitled to be paid SAP
- the amount of SAP you should pay
- how much you can recover
You can print the figures worked out by the SAP calculator so they're ready to enter in:
- the P11 Calculator on the CD-ROM
- your commercial software (but this may have its own SAP calculator)
- a paper form P11
HMRC sends you the Employer CD-ROM when you register as an employer and issue updates, usually twice a year. You can use HMRC's online ordering service to order further copies - simply enter how many you need, complete your contact details and click on ‘Order’.
Always check that you’re using the latest version of the CD-ROM, with up-to-date tables.
Order the Employer CD-ROM online
Find out how to record payments and deductions on form P11
Go to E16, ‘Employer Helpbook for Statutory Adoption Pay’
Calculating SAP manually
If you want to calculate your SAP payments manually you’ll have to know how to work out:
- whether your employee has worked for you long enough
- whether they earn enough
- how much to pay them
Your employee is entitled to SAP for up to 39 weeks. You must pay them the lower of:
- £123.06 (from 6 April 2009)
- 90 per cent of their average weekly earnings
You’ll find guidance on how to work out average weekly earnings in E16, ‘Employer Helpbook for Statutory Adoption Pay’. Read the section ‘Quick method for calculating Average Weekly Earnings (AWE)’.
Read E16, ‘Employer Helpbook for Statutory Adoption Pay’
Calculate SAP recovery manually
How much SAP you can recover depends on the total amount of employer’s and employees’ Class 1 NICs you pay in the ‘relevant tax year’.
The ‘relevant tax year’ is the tax year immediately before the tax year in which your employee’s ‘matching week’ falls (this being the week in which they were told they’d been matched with a child).
You’ll find the total of your employer’s and employees’ NICs for the tax year on your copy of form P35 Employer Annual Return.
If your annual liability for Class 1 NICs is £45,000 or less
If your Class 1 NICs are £45,000 or less in the relevant tax year, you can recover 104.5 per cent of your SAP payments made in the same tax month. For 2009-10 this is made up of:
- 100 per cent of the SAP
- 4.5 per cent of the SAP - this is an additional amount as compensation for the employer’s Class 1 NICs you’ll have paid on the SAP
If your annual liability for Class 1 NICs is more than £45,000
If your Class 1 NICs are more than £45,000 in the relevant tax year, you can recover 92 per cent of the total of all payments of SAP made in the same tax month.
You might have paid no Class 1 NICs in the relevant tax year - or only paid them for part of it. In this case, you’ll need to check to see if you were paying them at the rate of more than £45,000 a year. You do this by working out your average monthly payment and multiplying that by 12.
You’ll find a full explanation of how to work out how much SAP you can recover in E16, ‘Employer Helpbook for Statutory Adoption Pay’ – read the section ‘Recovering SAP’. This explains what period to use to work out your average monthly payment if you paid no NICs for the relevant year, or if you only paid them for part of it.
Go to E16, ‘Employer Helpbook for Statutory Adoption Pay’
Advance funding for SAP
If you don't have sufficient payroll deductions available to cover the SAP you’re entitled to recover, you may be able to apply for funding from HMRC. Follow the link below for more information.
Get help with statutory payments funding
SAP and salary sacrifice schemes
If you provide benefits to your employees under a salary sacrifice scheme, this can have an impact on SAP. Follow the link below for guidance on this issue.
Find out about the impact of salary sacrifice arrangements on SAP (PDF 134K)
Help and advice
Follow the links below to find out more about SAP.
Statutory Adoption Pay - an overview
Read E16, ‘Employer Helpbook for Statutory Adoption Pay’
Quick answers to common questions on SAP
If you still can’t find what you need, you can ask a question through HMRC’s email query service.
Use the SAP email query service
Alternatively you get advice from HMRC’s Employer Helpline on Tel 08457 143 143 (open from 8.00 am to 8.00 pm from Monday to Friday and from 8.00 am to 5.00 pm on Saturday and Sunday).
